The GSMA has defended the Nigerian government approved 50 per cent increase in telecommunications tariffs, emphasising its necessity for sustaining telecom operations and improving service quality.

According to the GSMA team, the Nigerian telecom sector has struggled with declining revenue, rising operational costs, and the challenge of attracting investment for network expansion.

This was stated at the GSMA media briefing where issues such as poor network quality, high operational costs and slow adoption of advanced mobile technologies like 4G and 5G were raised amid the tarrif increase.

The Senior Director Public Policy and Communications Sub-Saharan Africa at GSMA, Caroline Mbugua, said the industry has continued to invest in networks despite significant financial losses, particularly for publicly listed operators.

Mbugua stated that this tariff increase ensures continued investment in network upgrades and service reliability.

However, consumers and businesses remain concerned about whether the price hike will translate into tangible improvements.

Journalists at the briefing raised pressing concerns about persistent network failures, which have led to substantial business losses.

When asked if the tariff hike would address these issues, Mbugua pointed to infrastructure limitations, high spectrum costs, and outdated technologies still in use across Nigeria.

“We anticipate that additional investment will go into upgrading networks from 3G to 4G and expanding 5G coverage,” she said.

The Head of Sub-Saharan Africa at GSMA, Angela Wamola, highlighted the broader digital transformation challenge, stating that despite having 4G coverage, about 60 per cent of the population in Nigeria does not use mobile internet, either due to lack of smartphones or high data costs.

She emphasised that the future of Nigeria’s economy relies on strong digital infrastructure, requires capital-intensive investments.

Another major concern is the slow adoption of 5G. While Nigeria has been a leader in rolling out 5G in Africa, many mobile phones in the country remain limited to 2G or 3G, and upgrading to 5G-compatible devices remains costly.

When asked whether Nigerians would be forced to buy new phones every time mobile technology advances, Wamola acknowledged the affordability challenge but argued that technological evolution is inevitable.

“Smartphone manufacturers determine which networks their devices can support. While 5G-compatible devices are becoming more affordable globally, there is still a gap in accessibility in Nigeria,” Wamola explained.

Despite these challenges, GSMA insists that Nigeria’s digital economy stands to benefit from increased investment in mobile infrastructure.

While the telecom sector contributed 13.5 per cent to Nigeria’s GDP in 2023, amounting to N33 trillion, GSMA projects that with improved connectivity, there will be an additional 15 million internet users and 2 million new jobs by 2028.

However, experts warn that if Nigeria does not prioritize affordability and faster infrastructure deployment, it risks falling further behind in the global digital economy.

Wamola warned that failure to address telecom funding issues could lead to shrinking investment and an increasing digital divide.

While the 50 per cent tariff hike is positioned as a means to improve service quality and drive network expansion, many Nigerians remain skeptical.

With inflation already straining household incomes, higher telecom costs could further burden consumers.

The success of the price adjustment will ultimately depend on whether telecom operators reinvest in network improvements and whether regulatory bodies like the Nigerian Communications Commission (NCC) ensure that consumers receive value for money.