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Nigeria
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Nigeria has been experiencing major development and expansion of its telecommunication networks which has accelerated the nation’s development. The rural and previously underserved areas now have access to basic telecommunication services which has indirectly contributed to the improvement of various industries and businesses in the country. The telecommunications market is fully liberalized, with competition allowed in virtually all segments. And there is a unified licensing regime in place, which allows operators to offer converged services.

Licenses & Regulations

The country’s national telecom regulator is NCC, The Nigerian Communications Commission, which is responsible for creating an enabling environment for competition among operators in the industry as well as ensuring the provision of qualitative and efficient telecommunications services throughout the country.

The NCC operates under the Nigerian Communications Act 2003 which strengthens the capacity of the NCC to properly carry out its Regulatory Activities, and the Wireless Telegraphy Act 1990.

All telecommunications service operators are required to apply to the Nigerian Communications Commission (NCC) for relevant licenses by obtaining the Commission’s relevant application forms and to comply with requirements there in.

Individual licenses are of 2 types, Basic and Major. Basic licenses are granted for the provision of the following services:

  • Community Telephony
  • Internet Services
  • Prepaid Card Calling Services
  • Public Payphone Services
  • Sales and Installation
  • Voice Mail

Major licenses are issued for the provision of services including but not limited to the following:

  • Digital Mobile License (GSM)
  • Fixed Wireless Access (FWA)
  • National Carrier
  • Internet Exchange
  • Metropolitan (Fiber) Cable Network
  • International Gateway

Fixed Lines

Nigeria’s telephone system is described as inadequate, mainly limited by poor maintenance and network quality. Therefore Nigerians have sought to own more than one mobile phone, being forced to rely on other means for communication. Nigeria has witnessed great expansion and modernization of its fixed-line telephone network. The addition of a second fixed-line provider in 2002 resulted in faster growth. Nigeria is the most competitive fixed-line market in Africa, featuring a second national operator (SNO) and over 50 other companies licensed to provide fixed telephony services. The number of fixed lines was 1.4 million at end of 2009, including fixed wireless access.

Mobile

By the end of July 2009 it was estimated that there were some 415.3 mobile subscribers in Africa, of which Nigeria had some 16.5 percent (around 68 million), making it the largest single market in Africa. 7 million subscribers were added in the last quarter of 2008 alone, resulting in the highest number of net additions since GSM was introduced in 2001. Even though Nigeria became the largest mobile market on the African continent in 2008, it still has a mobile penetration level of less than 50%, suggesting that there is ample room for expansion of the market. Nigeria's four private mobile operators, MTN, Globacom, Zain and Etisalat, continue to demonstrate robust growth.

Mobile Operators

Average Revenue per User (ARPU)

Growth was very strong in the beginning but has slowed in recent years as penetration and competition have increased and tariffs have dropped. Declining ARPU levels, however, are weighing heavy on the sector, as is the new unified licensing regime introduced in 2006, designed to increase competition between fixed and mobile network operators. MTN and Zain have witnessed a drop in ARPU levels to US$13 and US$7 during the first quarter of 2009, whereas ARPU for Etisalat was estimated to be US$10 in 2008. Some of the CDMA operators, however, are enjoying brisk business, with players such as Starcomms, Multi-Links, Visafone and ZOOM mobile enjoying ARPU levels in excess of US$30 per month.

Internet

Until March 2008, only 7.2% (10 million) of Nigerians used the internet. However, Nigeria’s internet future is at the doorstep with the arrival of the international submarine communication cable to Lagos. The cable is built by Alcatel and financed by Globacom, and spans 9200 km from Portugal and passes through 15 countries to reach Lagos. Once set up, this cable will increase the quality of internet services for Globacom’s customers. In addition, Alheri, is also putting up fiber optic cable lines all over the country to provide faster internet connection to homes and offices.

Key Figures

  • Number of main lines in use: 1.308 million (2008)
  • Number of mobile subscribers: 82,381,000 (2010)
  • Number of internet users: 23,982,200 (Dec. 2009)
  • Number of ISPs: 50 licensed providers out of which only 35 are operational (2004)
  • Number of Internet hosts: 1,098 (2009)
  • Mobile penetration rate: 41.6% (2008)
  • Internet penetration rate: 7.4% (2009)
  • Fixed line penetration rate: 10% (2008)

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