Nigeria has Africa's largest mobile market, with about 142 million subscribers and a penetration rate of 101%. The number of subscribers fell in 2017 as consumers responded to a poor economic climate, adopted other OTT channels for voice and data services, and as regulatory measures continued to oblige operators to disconnect unregistered SIM cards. The initial rapid growth in the number of subscribers had led to problems with network congestion and quality of service, prompting the regulator to impose fines and sanctions on network operators. These operators have responded by investing billions of dollars in base stations and fibre transmission infrastructure to support the increasing demand for data. Although GSM technology still dominates there is a growing shift to services based on LTE.
Efforts are also being made to encourage network sharing and to outsource the management of tower infrastructure to third parties. There remains considerable growth potential in rural areas where the provision of network infrastructure and operations is expensive, and consequently where mobile penetration is lower. The government's plans to increase broadband penetration to 30% by 2018 largely depend on mobile networks, while the aim to increase mobile broadband penetration to 50% by 2020 rests on upgrades to network capabilities.
Although the market is one of the most competitive in Africa, a price floor was applied in 2013 on voice and data tariffs in a bid to prevent the dominant operators from squeezing competitors. This price floor was reduced in November 2016 but swiftly retracted.
Following years of delay, Mobile Number Portability (MNP) was introduced in 2013, and this has stimulated market competitiveness.
Government commits to increasing mobile broadband penetration to 50% by 2020; bidders shortlisted for acquisition of 9Mobile; regulator prepares to revise mobile interconnection rate; MTN Nigeria awarded spectrum in the 2.6GHz band for LTE use, extends licenses for spectrum in the 900MHz and 1800MHz bands to August 2021; MTN Nigeria delays IPO to 2018; government prepares legislation to enforce 9% tax on electronic communications services; NatCom Consortium launches LTE-A services; additional base stations installed under the USPF program; Airtel Nigeria sells tower infrastructure; report update includes operator data to Q3 2017, regulator's market data updates to December 2017, recent market developments.
Companies mentioned in this report:
MTN Nigeria, Glo Mobile (Globacom), Bharti Airtel (formerly Zain, Celtel), 9Mobile (Etisalat Nigeria, EMTS, Mubadala), M-Tel (Nitel), Visafone, Starcomms (Capcom), Multi-Links, Reliance, InterC Network (Intercellular), Megatech Engineering (Zoda Fones), Telkom, Econet Wireless, Vodacom.