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There are serious indications that the target to achieve over 30 per cent broadband penetration come next year by the country may be a mirage going by the observed drop in investments on broadband infrastructure by telecoms companies in recent times.
It has been noted that for Nigeria to achieve broadband penetration as planned, telecoms need to invest well over N100bn in the delivery of needed infrastructure across the country, but due to the biting forex crisis, some networks may have reduced the investment and are now working on how to weaken data services so that only voice services can be seamless.
In a recent interview with Business Hilights, the managing director of Spectranet, Mr. David Venn had explained that it will take awhile for internet service provision by GSM firms to be fast and stable because it would amount to huge revenue loss to telecoms as voice rakes in more money than data services.
He said even though GSM firms may be angling to show that they are serious in growing data traffic, “In their minds, making more money from voice is uppermost and that mindset will continue to hobble data services for years unless government can track them”.
“You may be shocked to hear that what a GSM network rakes in from your N1,000 recharge card load for voice is more encouraging to the GSM service provider than what it will make as profit when you loads same value of recharge card and convert it for data use”.
But as if apparently frustrating data usage with poor service delivery is not enough now, the GSM firms are now angling to further kill data uptake by way of planning to block subscribers from accessing Skype and other Over-the-Top (OTT) services.
Investigations showed that they are unsettled by the way many Nigerian subscribers are shifting voice calls to the use of internet data than the direct use of credits in their devices.
Currently, telecoms companies in the country are hoping to address concerns over revenue loss from international calls and hit a revenue target of N20tn by blocking subscribers from accessing Skype and other OTT services.
It was reliably gathered that subscribers might also be prevented from performing certain functions like voice and video calls on WhatsApp and Facebook, among other OTT services.
Analysts say Skype is a proprietary Voice-over Internet Protocol software for calling other people on their computers or mobile phones.
Clearly, phone calls using the Skype software can be placed to recipients on the traditional telephone networks; and calls to other users within the Skype service are free-of-charge, while calls to landline phones though reasonably priced, are charged via a debit-based user account system.
Already, a manager at one of the major telecos in the country said “It is an aggressive approach to stop further revenue loss to OTT players on international calls, having already lost about N100tn between 2012 and 2017”.
The official noted further that “If we fail to be pro-active by taking cogent steps now, then there are indications that we may lose between N20tn and N30tn, or so, by the end of 2018.”
From all indications, GSM companies worried that the increasing rise of the OTT players, who provide voice and Short Message Services, or apps such as WhatsApp, Skype, Facebook, BlackBerry Messenger and Viber, was eating deep into the voice revenue of telecommunications companies in the country by more than 50 per cent.
Only recently, a United Kingdom-based research and analytics company, Ovum, stated in a report recently that $386bn loss would accrue over a period of six years – between 2012 and 2018 – from Nigerian customers using the OTT voice applications.
According to the Principal Analyst at Informa Telecoms and Media, Matthew Reed, “the main fear of the telecoms operators here will be that customers will increasingly use Skype as a substitute for conventional international calls,”
Telecoms operators in the country said that international calls made up a critical part of their revenue because of Nigeria’s large expatriate and Diaspora population.
Analysts say the apprehension over shift from voice call, is worsened by the steep decline in voice revenue as discussion trend is now being taken over by OTT.
In the light of this development, operators are beginning to blame the Nigerian Communications Commission (NCC) for not properly regulating the sector in order to protect and keep them in business.
But in a swift response, the Director, Public Affairs, NCC, Mr. Tony Ojobo, said, “We don’t have any evidence of that. We do not regulate the Internet.”
Key operators in the country’s $38bn telecoms market such as MTN, Globacom, Airtel and Etisalat said if the NCC failed to take decisive actions, they would keep struggling to counter a trend in which the prices of basic voice and data services were declining.
This may be from where the idea to block OTT and related data services stemmed because MTN Nigeria said that the OTT content services had a “cannibalising effect” on network operators’ voice and data revenue, because they provide “free” services, which duplicate those already provided by network operators such as voice calls and the SMS.
The Public Relations and Protocol Manager, MTN Nigeria, Mr. Funso Aina, said “It (WhatsApp) has also launched a free voice service,”, adding, “The point to note in this argument is that the OTTs allow users to send unlimited texts, images, video and audio messages free of charge, using their current data plans.”
According to him, the problem is that these services are provided using network infrastructure of the operators, but without commensurate compensation to operators.
“For instance, to date, MTN has invested over $15bn in building its network in Nigeria. You can now imagine an OTT leveraging the network to deliver its content without investing a kobo locally. The impact on revenue is huge,” Aina averred.