MTN Nigeria Communications Plc and Airtel Africa have ramped up core capital expenditure to match excessive information utilization within the nation.
The Nigerian Communications Fee (NCC) reported in February that month-to-month web utilization soared by 93.35 p.c to an all-time excessive of 1,000,930.6 terabytes (TB) in January 2025 from 517,670.15 TB in January 2023.
This surge has been fuelled by the elevated adoption of digital companies, particularly streaming and social media platforms.
“Social media and streaming content material have been essential in driving information consumption,” stated Karl Toriola, chief government officer of MTN Nigeria.
On the again of this, MTN’s information site visitors rose by 42.9 p.c, with the typical information utilization per subscriber rising by 33.6 p.c to 11.2GB (with a 37.9 p.c enhance to 13.2GB) within the fourth quarter (This autumn) of 2024.
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Airtel Africa’s common information utilization per buyer has elevated by 37.2 p.c to eight.4 GB per 30 days from 6.2 GB. Smartphone information utilization per buyer reached 11.2 GB per 30 days from 8.8 GB per 30 days.
To accommodate this progress, telecom firms elevated their capex spending within the This autumn of 2024, aspiring to spend extra in 2025.
“We accelerated capex deployment in This autumn to accommodate the stronger-than-expected information site visitors progress on our networks,” MTN acknowledged in its monetary assertion.
MTN spent N225.85 billion on capex in This autumn of 2024, accounting for 50.93 p.c of its whole N443.48 billion core community funding for the yr. Though this marked a 1.30 p.c decline year-on-year, the telco acknowledged that it’s growing investments in its community infrastructure to assist future progress.
Airtel Africa, which serves 57.67 million Nigerian subscribers, allotted $456 million for capex within the 9 months ending December 2024, a 7.8 p.c y-o-y decline. Nonetheless, it intends to spend an additional $294 million earlier than March 2015 to take whole spending to $750 million.
Sunil Taldar, CEO of Airtel Africa, stated, “We stay dedicated to investing for the long run by increasing our distribution and community to make sure that we seize this vital progress alternative on supply.
“The size of knowledge site visitors progress throughout our markets – a rise of 49 p.c over the past yr – is testomony to the investments we’ve made and the relentless concentrate on our technique to create worth for all our stakeholders.”
For a lot of 2024, MTN and Airtel slowed down community investments attributable to financial pressures and efforts to scale back their overseas debt burdens. The 2 telcos collectively repaid $1.2 billion in overseas loans, redirecting funds that would have gone into infrastructure growth.
This decline in investments, coupled with an related discount in actual income, impeded operators’ potential to develop their community capability, worsening service high quality throughout the nation.
“On the finish of the day, no money was left to pay our payments. No money is left within the account. We have been burning 120 p.c of our money move,” Toriola of MTN famous.
“Deteriorating community high quality is because of declining investments within the sector,” echoed Gbenga Adebayo, chairman of the Affiliation of Licensed Telecom Operators of Nigeria (ALTON).
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Knowledge tariff hike
To handle this concern, the NCC lately accepted its first tariff hike since 2013, noting that “these changes will assist the power of operators to proceed investing in infrastructure and innovation, in the end benefiting shoppers via improved companies and connectivity, together with higher community high quality, enhanced customer support, and better protection.”
The regulator has now given operators a three-month deadline to enhance community high quality or face penalties. In a gathering with publishers, Toriola defined that the current 50 p.c enhance would unlock extra cash for telcos to put money into their community.
“Primarily based on our projections, there can be extra cash move, that means extra funding to develop and supply high quality of service, redundancy, and higher buyer expertise,” he stated.
“The value enhance will allow us to proceed investing in community infrastructure, increasing protection, and delivering improved services and products that meet the evolving wants of our clients,” echoed Dinesh Balsingh, CEO of Airtel Nigeria.
MTN has already outlined an improved capex deployment technique for 2025, geared toward enhancing community capability and buyer expertise.
“In 2025, we plan to speed up capital expenditure to enhance community capability, promote digital inclusion, and improve buyer expertise,” added Toriola of MTN.