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Poor quality mars Nigeria telecoms

Poor quality mars Nigeria telecoms

On the face of it, all appears well in the Nigerian telecoms industry. The compound annual growth rate (CAGR) between 2007 and 2013 was more than 20%, while, according to Pyramid Research, the fast pace of growth and Nigeria’s population of over 170m people means it remains one of the most attractive markets in the Middle East and Africa (MEA) region. Tom Jackson reports.

However, not all is totally rosy; operators, the regulator, the government and subscriber groups continue to puzzle over the causes of the poor quality of service (QoS) served up to customers. In February, the regulator, the Nigerian Communications Commission (NCC) fined three of the country’s operators – MTN, Globacom and Airtel – a total of NGN647.5m ($4m) for breaches of a number of key performance indicators (KPIs) and providing poor service. MTN was also banned from adding new subscribers for one month.

Analysts agree more needs to be done than simply sanctioning offending operators if subscribers are to see an improvement

The operators “reluctantly” agreed to pay the fines, with chairman of the Association of Licensed Telecoms Operators of Nigeria (ALTON) Gbenga Adebayo saying fines would not improve poor service quality and only make the situation worse. “The operators decided to play the role of the obedient students to their teacher, since the fine was paid out of bitterness and pain, and I pray that it will not get to a level where the subscribers will begin to fight the operators for depriving them of what belongs to them,” he said.

Analysts agree more needs to be done than simply sanctioning offending operators if subscribers are to see an improvement. Ovum analyst Danson Njue says the many stakeholders need to get to the bottom of the issue.

“This can only be achieved if both parties work closely with one another to address the real cause of the problem,” he said.

That QoS in Nigeria is poor is undeniable. Subscriber groups have threatened to take telecoms to court for compensation, while in May the National Association of Telecom Subscribers (NATCOMS) said the levels of service were becoming “unbearable” and continuing to deteriorate, with president Chief Deolu Ogunbanjo urging operators to provide better customer care.

Farcical excuses

Some of the excuses offered by the operators have been farcical. In July ALTON and MTN claimed poor service witnessed this year was a result of excessive rainfall, a claim which if true would make Nigeria the exception globally. Operators are certainly guilty of signing up subscribers when they know they may not have enough capacity to serve them during peak hours, and have failed to seek alternative power sources in the event of electrical interruptions.

In July ALTON and MTN claimed poor service witnessed this year was a result of excessive rainfall, a claim which if true would make Nigeria the exception globally.

But the operators are right in that the fault does not rest entirely with them. The NCC and the government have failed to quicken the passage of a bill before the National Assembly that would designate telecoms facilities as Critical National Infrastructure; this has left them without support when power fails and at the mercy of vandals and militants. Telecoms companies are losing more than N750bn ($4.6bn) every year due to attacks on their infrastructure in northern Nigeria, with Oracle estimating operators lose $2m an hour due to downtime, partly caused by Boko Haram.

Operators are also correct to complain about excessive tax demands placed on them by state governments to set up the necessary Base Transceiver Station (BTS), some of which have been closed by the authorities until payments are made. Charges imposed can rise as high as $5,000 per mast in some states, as well as $30 per metre of fibre cable laid. In this they have obtained an unlikely ally, with NATCOMS (National Association of Telecom Subscribers) urging the government to reduce these charges.

Lack of spectrum has also been an issue, with Njue urging regulators to be bold and free up unused spectrum for operators who need it. This process has begun but is by no means complete. Telecoms companies have promised to increase investments in network expansion by 200% this year to tackle poor QoS. Cooperation on a variety of issues is needed from all parties if the telecoms sector is to have the kind of positive impact on Nigeria’s economy showing signs of having.

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Written by Tom Jackson

Tom Jackson is a tech and business journalist based in South Africa . A UK-trained reporter, he is committed to the dream of African development through technology. Tom is looking to present a picture of the "real" Africa tech scene in order to aid better understanding of how it can be used to develop Africa economically and socially.

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