A significant financial strain has been placed on approximately 170 million consumers, including businesses, across Nigeria due to a 50% increase in telecoms service tariffs and escalating data depletion issues. Over the past three weeks, individuals and enterprises heavily reliant on the internet for their livelihoods have faced mounting challenges.
The situation has been exacerbated by declining service quality and a noticeable spike in data depletion since the tariff hike was implemented. Compounding the issue, Multichoice, the parent company of DStv and GOtv, announced a 21% price increase effective March 1, 2025, just 12 months after its last hike. However, the Federal Competition and Consumer Protection Commission (FCCPC) intervened, directing the company to suspend the planned increase.
This development coincides with the telecoms operators' recent 50% adjustment to data prices, further burdening subscribers already grappling with the financial strain of stringent economic policies. For many Nigerians, the dual impact of rising data costs and increased pay-TV tariffs has created a dilemma: choosing between subscribing to television services or allocating more funds to expensive data plans for streaming platforms like Netflix, Showmax, and Amazon Prime Video.
The Escalating Crisis of Data Depletion
Data depletion, which occurs when subscribers exhaust their data bundles prematurely or consume more data than necessary for online activities, has become a nationwide issue. From Lagos to Abuja, Enugu to Ondo, and Zamfara to Rivers, consumers and businesses alike are experiencing the same distressing challenges. Small and medium-scale enterprises (SMEs), in particular, are feeling the brunt of these macroeconomic pressures, as higher data costs strain their already tight budgets.
Businesses relying on online platforms, cloud services, and digital marketing are now facing increased operational expenses, further threatening their sustainability. In an economy still recovering from high inflation—which recently dropped from 34% to 24% after the Consumer Price Index (CPI) was rebased—the timing of these tariff adjustments could not be worse. Major telecoms providers such as MTN, Airtel, Glo, and 9mobile have revised their pricing structures, with some large data plans now costing as much as N120,000. This has forced many consumers to reconsider their internet usage and spending habits.
Current Data Consumption and Pricing Trends
As of January 2025, data from the Nigerian Communications Commission (NCC) revealed that there are 141 million internet users accessing services via narrowband (GSM), while broadband penetration stands at 45%. Data consumption has surged to 1,000,930.6 terabytes, reflecting the growing reliance on digital services.
Under the new tariff regime, MTN’s revised data plans include a 1.8GB monthly bundle now priced at N1,500, up from the previous 1.5GB plan at N1,000. Similarly, the 20GB plan has increased to N7,500 from N5,500, while the 15GB plan now costs N6,500, up from N4,500. Airtel has also adjusted its pricing, replacing its 1.2GB plan for N1,000 with a 2GB plan for N1,500. Other changes include 3GB for N2,000 (previously 1.5GB at N1,200), 4GB for N2,500 (formerly 3GB at N1,500), and 8GB for N3,000 (up from 4.5GB at N2,000).
For router users, the situation is even more dire. For example, a monthly subscription of 30GB, which previously cost N8,000, has been increased to N20,000 for 100GB, with the added caveat that unused data will be forfeited if not exhausted within the subscription period. This has left many subscribers frustrated and financially strained.
Impact on Consumers and Businesses
The new tariffs have placed a significant financial burden on workers, with some spending up to 15% of the national minimum wage of N70,000 on communication services. For instance, MTN’s 20GB plan, now priced at N7,000, consumes 10.7% of a subscriber’s minimum wage, while Airtel’s 24GB plan at N5,000 accounts for 7.1% of earnings. A 25GB plan costing N8,000 represents 11.43% of the minimum wage, and a N20,000 data plan would consume nearly 28.5% of a worker’s income.
The crisis has sparked widespread outrage on social media, with subscribers calling on regulators to intervene. One MTN user, @Herdunney_1, described the new prices as exploitative, while another, @MistarShuga, lamented the frequency of monthly subscriptions. The sentiment is echoed by @gentle_theB, who stated, “They have dried us up.”
Technical Factors Contributing to Data Depletion
The NCC has attributed rapid data depletion to several technical factors, including excessive usage of data-intensive applications like video streaming, large file downloads, background app activity, automatic updates, and poor network quality. Additionally, the use of older network technologies such as 2G or 3G, instead of the more efficient 4G or 5G, exacerbates the problem.
SMEs and Subscribers Bear the Brunt of Telecoms Tariff Hikes
Albert Aina, a logistics entrepreneur and small and medium-scale enterprise (SME) operator, has voiced his frustration over the rapid depletion of data, which has become a significant challenge for his business. “Within two weeks, I have spent nearly N20,000 on 50GB of data. Ordinarily, this should have lasted me two months or at least one and a half months, but the way it depletes is beyond comprehension. Something needs to be done urgently. The prices must be reviewed!” he lamented.
Aina also called on the Nigeria Labour Congress (NLC) to take decisive action. “The NLC must not disappoint Nigerians anymore. They need to be firm in their protest against these exploitative practices. The back-and-forth must stop. The NLC must rise to the occasion and help put an end to this exploitation through protests and possible boycotts of telecom services,” he urged.
The NLC had earlier issued a warning that if telecom companies failed to revert to the old tariff rates by the end of February 2025, it would mobilize workers to shut down their operations nationwide by March 1, 2025. NLC Chairman Joe Ajaero had pledged to lead the resistance against the arbitrary tariff hikes by boycotting the services of major telecom operators such as MTN, Airtel, and Glo.
However, just days before the March 1 deadline, reports emerged that the Federal Government and the NLC had reached an agreement to reduce the tariff hike from 50% to 35%. Despite this, senior executives from several telecom companies denied being informed of any such directive from the Nigerian Communications Commission (NCC), leaving subscribers in a state of uncertainty.
Calls for Government Intervention
Subscriber groups and non-governmental organizations (NGOs) have joined the chorus of voices urging the Federal Government to reconsider the tariff hike. The Cloud Network Foundation (CNF), for instance, warned of the potential economic and social repercussions of the increase. CNF Chairman Abimbola Tooki expressed concerns over the timing of the adjustment, noting that it comes at a time when inflation is at an all-time high, significantly eroding the purchasing power of Nigerians.
Tooki described the tariff hike as “insensitive and exploitative,” arguing that it could exacerbate the economic challenges faced by millions of telecom users. “The sharp increase in telecom tariffs is being perceived as an attempt to further disempower the people. This move could inadvertently fuel civil society agitation, as it reinforces the narrative that the government is seeking to stifle the voice of the masses rather than empower them,” he stated.
Echoing similar sentiments, Chief Deolu Ogunbanjo, Chairman of the National Association of Telecoms Subscribers of Nigeria (NATCOMs), advocated for a more moderate 10% hike, emphasizing that the current economic climate cannot support a 50% increase. He revealed that NATCOMs is prepared to take legal action against telecom operators if the Federal Government and the NCC fail to address the issue adequately.
Widening the Digital Divide
Telecoms expert Kehinde Aluko highlighted the broader implications of the tariff hikes, warning that they risk excluding millions of Nigerians from participating in the digital transformation, thereby widening the digital divide. He noted that access to affordable communication services is no longer a luxury but a necessity, as it facilitates critical sectors such as financial services, agriculture, education, healthcare, and social interactions.
“For small businesses and entrepreneurs who depend on reliable and affordable telecoms services to conduct their operations, the tariff hikes threaten to squeeze already thin profit margins and dampen economic activity,” Aluko stated. He emphasized that the hikes could reverse some of the gains made in leveraging telecoms to drive economic growth.
Operators’ Justification for Tariff Hikes
Telecom operators have defended the tariff adjustments, citing a 12-year stagnation in rate reviews, rising energy costs, galloping inflation, vandalism, and exchange rate volatility as key challenges facing the sector. These factors have significantly impacted their revenues and profitability. For instance, Airtel reported a revenue drop from $1.24 billion in 2023 to $738 million in 2024, recording a loss of $89 million due to exchange rate volatility and the devaluation of the naira. Similarly, MTN reported a loss of N514.9 billion in the nine months leading up to September 2024, compared to N15 billion in the same period the previous year, attributing the decline to inflation and naira volatility.
Gbenga Adebayo, Chairman of the Association of Licensed Telecoms Operators of Nigeria (ALTON), assured subscribers that service quality would improve within the first three months of implementing the 50% tariff hike. However, he cautioned that the quality of service (QoS) is contingent on economic and environmental factors. “If the challenges currently confronting the sector persist, operators will need to review the situation and make the best decision,” he stated.
Adebayo emphasized that the tariff adjustment was essential for the survival of the telecommunications sector, arguing that the government should not rely on the sector to subsidize other industries. “The sector cannot be the subsidy for other sectors. Our costs should be reflective of the economy. Telecoms cannot be used as palliatives. It is important that we charge rates that are sustainable,” he said.
The Path Forward
MTN’s Chief Corporate Services Officer, Tobe Okigbo, reiterated the need for sustainable pricing to maintain and expand services. “For every connection, there is a license fee paid. Keeping a customer comes at a cost, and keeping base stations running 24 hours comes at a cost. As we improve on current services, investments will come in, leading to expansion and broader coverage,” he explained.
Proposed Solutions
To address these challenges, the following measures could be considered:
- Regulatory Intervention: The NCC and FCCPC should work collaboratively to ensure fair pricing and protect consumers from exploitative practices.
- Improved Network Infrastructure: Telecoms operators should invest in upgrading their networks to 4G and 5G technologies to enhance efficiency and reduce data depletion.
- Consumer Education: Subscribers should be educated on managing data usage effectively, such as disabling automatic updates and limiting background app activity.
- Flexible Data Plans: Operators could introduce more flexible and affordable data plans tailored to the needs of low-income earners and SMEs.
- Transparency in Pricing: Telecoms providers should ensure transparency in their pricing structures and avoid hidden charges that exacerbate the financial burden on consumers.
In conclusion, while the tariff hikes are aimed at addressing the financial challenges faced by telecom operators, they have placed an undue burden on consumers and businesses, particularly SMEs. To strike a balance, the government, regulators, and operators must collaborate to ensure that pricing is fair, sustainable, and reflective of the economic realities faced by Nigerians. Failure to do so risks deepening the digital divide and stifling economic growth in an increasingly connected world.