Nigeria’s telecommunications sector is witnessing a surge of investment as operators seek to improve their network capabilities and meet the rising demand for data and voice services. According to data from the Nigerian Communications Commission (NCC), the 11 licensed telcos in the country invested a combined N732.42 billion in their networks in 2020, up from N504.33 billion in 2019.
This represents a 45.2% increase in capital expenditure (CAPEX) and reflects the telcos’ commitment to enhancing their infrastructure and service quality. The NCC report also showed that the telcos achieved a billing efficiency of 74.33% and a collection efficiency of 66.50% in 2020, despite the challenging operating environment caused by inflation, currency devaluation and foreign exchange shortages.
The leading telcos in terms of investment were MTN Nigeria, Airtel Africa and Globacom, which accounted for 77.8% of the total CAPEX in 2020. MTN Nigeria alone spent N570.97 billion on its network, increasing its 5G sites by 258.16% to 2,106. Airtel Africa spent $178 million (N161.45 billion) on its network, expanding its 4G coverage to all its sites and increasing its 5G sites to 235. Globacom invested N64.6 billion on its network, upgrading its 4G capacity and launching its Glo Cloud platform.
The telcos’ Investments paid off in terms of subscriber growth and revenue generation. The NCC report revealed that the total number of active mobile subscribers in Nigeria rose by 12.2% to 204.6 million in 2020, while the total revenue collected by the telcos increased by 11.38% to N542.73 billion. The telcos also contributed significantly to the Nigerian economy, accounting for 14.30% of the GDP in 2020, according to the National Bureau of Statistics (NBS).
The telcos’ investment drive is expected to continue in 2021 and beyond, as they seek to leverage the opportunities presented by the digital transformation of various sectors and the growing adoption of smartphones and mobile broadband services. The NCC has also pledged to support the telcos by creating an enabling regulatory environment and addressing the challenges of multiple taxation, vandalism and right of way issues.
The Nigerian telecommunications sector is poised for further growth and development, as the telcos invest in their networks to deliver better services to their customers and the nation at large.
Source: Business Day
