Barely eight months after the federal government approved a 50 percent tariff hike for telecom operators in the country, subscribers have begun to tell tales of woes on how the sharp increase is straining their budgets and negatively impacting on their socio-economic lives.
The service providers’ customers, who have no options but to use the telecom services, particularly expressed their concerns over increase of the 50% to the charges, calling on the operators to reconsider the plight of their subscribers and review the increase downward.
They are appealing to the service providers to review the 50% tariff hike currently being implemented down to between 10 and 35 percent, reports Daily Independent.
Prior to the approval of the data and call service rates increase, subscribers and non-governmental organisations (NGOs) unequivocally opposed the plan, stressing that the harsh economic situation the citizens were faced with would be further exacerbated.
But subscriber associations and other relevant civil society organisations (CSO) were taken aback when the government announced 50 percent hike.
Since the tariff increase, many subscribers have been struggling to enjoy the operators’ services because of lack of purchasing power for data and airtime for calls.
Speaking with our correspondent on the agitations being raised by the subscribers, the National Association of Telecom Subscribers (NATCOMS) President, Deolu Ogubanjo, said the development is of serious concerns to many Nigerians who are struggling to survive in the present economy.
“Yes, we were not against an increase on tariffs by the telecom service providers. We thought what they would come up with will have human-face because of the challenges Nigerians were confronting. We were alarmed that the NCC approved a whopping 50 percent price hike for operators without considering the implications to the common subscribers and the small businesses in the country.
“It was disappointing that after all deliberations by NATCOMS, NLC and other civil society organisations (CSO), they ignored increase of between 10 and 35 percent we presented and audaciously approved 50 percent hike which is now taking huge toll on individuals and organisations.
“I thought they would come up with meaningful incentives like airtime bonuses or promos. But what we see today are not worth it. Take for instance, MTN came up with their *888# for bonuses on recharges. Initially, when I load N1,000 airtime, they would give me N6,000 worth of airtime.
“But for some time now, they now offer N4,000 for the same N1,000 recharge. Is it too much for subscribers to enjoy some bonuses from the operators, upon the 50 percent tariff increase?” Ogunbanjo queried.
He asked the government to monitor the activities of the operators to ensure that subscribers are not shortchanged.
“A lot needs to be done by the industry regulator, the Nigerian Communications Commission (NCC), for the protection of telecom services consumers. Thank God, the federal government recently scrapped the lingering 5 percent excise duty on telecom services which was introduced by the late President Muhammadu Buhari’s administration.
“If the 5 percent tax were not totally removed, the 50 percent increase heat being felt by the subscribers would have been more serious. We and other organisations sued the government on the 5 percent tax. But with the removal, we have withdrawn the case which was expected to come up for hearing next month October from the court,” he explained.
Some subscribers have expressed their frustration not only on the high cost of data and airtime for calls, but also on the speed at which their data and airtime get exhausted.
A Lagos-based subscriber, Benson Jatto, said the 50 percent tariff increase has limited his business reach because of the cost of airtime.
“I am a small scale businessman who have a lot of customers to communicate with extensively with, every now and them. But I have cut back my telecom service expenses. Most of my customers don’t have Android phones for WhatsApp communication. So, we communicate on normal calls for several minutes.
“When I recharge for instance, N2,000, before long, everything gets exhausted. Unlike before, I believe I could use N500 for the same period that consumed my N2,000. “Frankly speaking, I doubt if it is 50 percent they are applying. It seems like 150 percent,” Jatto said.
For Deborah Momodu, a teacher, the cost of telecom services is competing with food cost.
According to her, “You know the situation in the country today. Use of phone has become a necessity just like food. Many people use their phones as medicine for mental health to mitigate depression and other related emotional issues. In practical terms, if I have N1,000, and I am hungry, and there is airtime on my phone, I will share the money into two. N500 for food, and N500 for airtime. That is the situation with some people today.
“My appeal to the government is to intervene and see how people can enjoy telecom services in this country without paying through their nose. I learnt that inflation in the country is dropping. I think it should also reflect on telecom services by the operators to reduce the 50 percent increased tariff to about 20 or 30 percent.”
There is no doubt to the fact that the new tariffs have made some workers to be spending as much as 15 percent or more of the minimum wage salary on communication.
In the same vein, many businesses which rely on online platforms, cloud services and digital marketing for transactions, now face higher expenses that strain their budgets due to increased data costs.
Before the 50 percent tariff hike, telecom operators were pushing for a 100 percent increase, industry challenges such as rise in energy costs, multiple taxation, vandalism, among others as part of the challenges facing the sector. They also cited a 12-year stagnancy in rate review as the main basis for their push.
The Chairman of the Association of Licensed Telecoms Operators of Nigeria (ALTON), Gbenga Adebayo, while justifying the hike implemented by the telecom service providers, noted that the telecom industry in Nigeria is stressed up with many environmental and economic challenges that called for the tariffs review.
“The tariff adjustment was essential for the survival of the telecommunications sector. The government should not rely on the sector while others are subsidised,” he said.
The President of the Association of Telecommunications Companies of Nigeria (ATCON), Tony Izuagbe Emoekpere, said the increased telecom tariffs by 50 percent is the recognition of the mounting operational challenges faced by operators. He stressed that the NCC was magnanimous to have approved only 50 percent.
“While the approved tariff adjustment, capped at a maximum of 50%, does not fully address the operators’ request for a 100% increase, we understand that this is a step towards bridging the gap between operational costs and revenues.
“This adjustment will enable operators to continue investing in infrastructure, expand coverage, and improve service quality for the benefit of all Nigerians,” ATCON president posited.
Some industry analysts have opined that access to affordable communication services is no longer a luxury but a necessity because it facilitates businesses including financial services and agriculture, education, healthcare, and social interactions.
According to them, the steep hike could place considerable financial strain on consumers which could lead to reduced accessibility for low-income users. With time, the tariff hike may be counter-productive to the telecom operators who currently feel favoured by it.
They noted that the increased tariff may slow the industry dynamism for economic growth and gradually widen the digital divide as millions of Nigerians will be excluded from participating in digital transformation, unless pragmatic steps are taken by relevant authorities to ensure that, not only accessibility of telecom services are attended to, but more also the affordability.
