In Nigeria, fewer people are using mobile subscriptions now than there were a few months ago. According to data on the latest industry statistics released by the Nigerian Communications Commission, in May 2023, there were 220.93 million mobile subscribers, down from the 225.88 million mobile subscribers registered in January 2023. Out of the top four mobile operators in Nigeria, MTN Nigeria lost 4.03 million (from 92.71 million to 88.68 million), while retaining its spot as the largest mobile network operator in the country. However, operators such as Globacom marginally grew by 172,867 from 60.76 million to 60.93 million; Airtel added 31,705 new subscriptions and grew from 60.30 million to 60.33 million; and 9mobile witnessed the largest growth, adding 330,003 new subscriptions to hit 13.40 million from 13.07 million in the period under review.
Over the years, Nigeria has been worked to improve the country’s mobile connectivity. The country has recorded a steady increase in mobile phone users since 2001. Ironically, the current decline comes after mobile subscriptions reached an all-time high of 227.17 million in February of this same year. Since then, the numbers have steadily been decreasing, reflecting a concerning trend for the nation’s mobile connectivity. This is the first time since June 2021 that mobile subscriptions have fallen consistently.
There are a few reasons why people might have canceled their mobile phone plans. In 2020 and 2021, the Federal Government made it a requirement for people to link their SIM cards to their National Identification Numbers (NINs). This affected the mobile industry and caused a steep decline in mobile subscriptions. This policy has made it more difficult for people to get new SIM cards and made it more expensive to keep their old SIM cards active. However, the subscriptions have since improved and risen to record highs. In February 2023, Nigeria experienced a cash crunch that led caused many people to depend on mobile money for their daily transactions. It is that month that month, the number of mobile subscribers reached an all-time high of 227.17 million. The value of mobile transactions rose by 124.8% to N2.4 trillion from N1.1 trillion in the period.
Another reason people might have canceled their mobile phone plans is because of inflation. According to the National Bureau of Statistics, Nigeria’s headline inflation rate accelerated for the fifth consecutive time to 22.41 percent in May. In MTN Nigeria’s first-quarter report, Chief Executive Officer, Karl Toriola, explained that these factors had added pressure to economic activities, consumers, and businesses alike. According to Tariola, “We continued to experience headwinds in our operating environment in the first quarter of 2023. The impacts of the ongoing global macroeconomic and geopolitical developments on energy, food, and general inflation were exacerbated locally by petrol and cash shortages experienced during the period. This placed additional pressure on economic activity, consumers, and businesses.” MTN Nigeria, which lost the most mobile subscriptions in the period, with 4.03 million lost subscriptions, is known for having high service costs. In May, when the telecom company announced that it was planning to increase prices in selected markets- which included Nigeria- due to the elevated inflation in the operating environment, subscribers took to social media to express concern that the services currently being provided by the telecom operator had become exorbitant, and it was becoming more difficult to keep pace with the high costs.
The telecom industry is important to the Nigerian economy. The sector is not only one of the fastest growing industries, directly creating millions of jobs, but it is also pivotal to innovation and development, as it provides the backbone infrastructure for transnational business. On a year-on-year basis, the sector contributes approximately 9.19 percent to Nigeria’s GDP. In the first quarter of 2022, the industry contributed 12.94 percent to the country’s GDP, and into the first quarter of 2023, it contributed 14.13 percent, showing an impressive growth trend from the industry. Nigeria’s mobile population is also the largest in Africa and the prior steady growth in the number of mobile subscriptions has been attributed to increased productivity and efficiency in other sectors. Interestingly, Nigeria’s mobile internet subscribers increased by 9.26 million within the last year, with a record high of over 2.7 million new internet users in March this year. Hence, the decline in the most basic form of connectivity should be a concern for the telecom industry in Nigeria.