While the ordered equipment is yet to arrive, undergo clearance, and be deployed nationwide, this substantial investment signals a renewed commitment to capital expenditure within the sector after a prolonged period marked by financial constraints.
Speaking to industry leaders in Lagos during a forum focused on updating the Nigerian Communications Act 2023 to align with current technological advancements, the Executive Vice Chairman (EVC) of the NCC, Aminu Maida, highlighted the operators' commitment to meeting the growing demands of their over 160 million subscribers.
“Our operators have committed to investing over a billion dollars in telecom infrastructure this year. This is more than double the investment from last year. But this equipment needs to be manufactured. We went to China, and the original manufacturers have confirmed the orders,” the EVC stated.
As Nigeria's telecommunications sector, valued at over $75 billion, gears up for its next phase of expansion, the regulatory body emphasized that a robust and upgraded infrastructure will be essential to address the increasing demand for data and to support the proliferation of emerging digital services throughout the Nigerian economy.
This development follows the NCC's approval months earlier of a 50 percent tariff increase – the first in eleven years. This tariff adjustment was aimed at providing relief to the sector, which has been grappling with soaring operating costs that operators claim have surged by over 300 percent in the past decade.
Prior to this tariff adjustment, telecom companies had consistently warned that stagnant tariffs, multiple taxation, and pressures from foreign exchange fluctuations were severely hindering their capacity to invest in their networks. This lack of capital expenditure had become a significant concern for Nigeria's rapidly expanding digital economy, contributing to declining service quality and limited network expansion.
Following the implementation of the tariff increase earlier this year, operators had assured the public that they would prioritize investments in network infrastructure within three months to address the persistent complaints from customers regarding dropped calls and subpar service quality.
Underscoring the industry's renewed focus on improving customer experience, the Chief Corporate Services Officer at MTN Nigeria, Tobe Okigbo, acknowledged the financial implications of poor service.
“We’re committed to improving the quality of service. Every time a call drops, we lose money. This is a critical issue, and we are focused on addressing it,” Okigbo affirmed during a panel discussion at the industry forum.
The significant investment in network infrastructure from Chinese manufacturers represents a crucial step towards modernizing Nigeria's telecommunications networks. The successful deployment of this equipment is anticipated to lead to improved network stability, reduced call drops, faster data speeds, and the capacity to support the growing digital demands of Nigerian consumers and businesses alike. The move also signals a potential turning point for the sector, paving the way for sustained growth and enhanced contributions to Nigeria's digital economy.