Why NCC Approved 50% Telecom Tariff Hike Amidst Economic Strain

In a significant move that has sparked debate across Nigeria, the Nigerian Communications Commission (NCC) has approved a 50% increase in telecommunications tariffs, marking the first adjustment of its kind in over a decade. This decision, announced on January 20, 2025, carries profound implications for both consumers and the telecom industry.

The increase will impact the cost of voice calls, SMS, and data services across all major telecom operators, including MTN, Glo, Airtel, and 9mobile. Specifically, the price of a minute-long call will rise from N12 to N18, while the cost of 1GB of data will increase from N500 to N750. This adjustment is capped at 50% of current tariffs, although some telecom companies had initially sought increases exceeding 100%.

This decision comes at a time when Nigeria is grappling with severe economic challenges, including a devalued naira, high inflation, and escalating operational costs for businesses. The telecom sector has been particularly vocal about its financial strain, citing increased diesel costs for powering base stations, higher import prices for equipment, and climbing wages to retain skilled labor.

The NCC justified the tariff hike as a necessary measure to bridge the gap between operational costs and existing tariffs, aiming to ensure the long-term sustainability of the telecom industry.

The tariff increase is expected to exert additional pressure on household and business budgets, with projections estimating that N6.74 trillion will be spent on voice calls alone in the coming year. Consumer advocacy groups have raised alarms over the potential consequences of this increase, particularly regarding reduced access to essential communication services for lower-income families and small businesses. Public discourse, especially on social media, has surged, with many Nigerians questioning the timing and magnitude of the hike amid ongoing economic recovery efforts.

Telecom operators, on the other hand, have largely welcomed the decision, viewing it as a lifeline to sustain investments in infrastructure and innovation. However, they acknowledge that even a 50% increase may not fully alleviate their operational challenges.

Some operators have pledged to channel the additional revenue into enhancing service quality, expanding network coverage, and improving customer service, though skepticism remains regarding how quickly these improvements will be realized by consumers.