Nigerian Communications Commission (NCC), the telecommunications regulator, recentlyslammed mobile phone company, MTN Nigeria, a N1.4trillion about ($5.2bn or £3.5bn)fine for failing to disconnect subscribers with unregistered SIM cards boughtbefore January 2012.Phonecompanies were told to register their existing customers’ Sim cards, which MTNNigeria allegedly failed to do.The fine isthe largest in the history of telecom infringements in Nigeria and may redefinethe relationship between telecommunications operators and the regulator.
It isunfortunate that MTN- the biggest mobile telecommunications firm in Nigeria-became victim of the law which its management was very much aware of and whichother operators complied with.And it happened at a time Nigerians are complainingso much about poor services from mobile network operators with blame going tothe regulator for not doing enough to solve the problem.Before now, MTN, Airtel and Globacom – paid fines of N647 million due to the poor servicethey provided between July 2013 and January 2014. In March and April 2012, the ‘big four’ paidanother fine of N1.17 billion forfailing to meet the standard performancerequired.
The negativesign of the recent MTN fine was manifested on Monday when its shares on the JohannesburgStock Exchange took a nose dive dropping more than 5 percent.Suffice it to say that the quality of service of telecom operators has beenanything but satisfactory. Despite increasing customers’ frustration, telecomcompanies continue to push for more revenue. Every year, these companies generaterevenues that surpass their returns in other African countries.
Last year alone, the four majorcompanies – MTN Nigeria Communications Limited, Airtel Networks Limited,Emerging Market Telecommunications Services Limited (Etisalat) and GlobacomLimited – generated over N2.5 trillion inrevenue out of the total N6.7 trillion generated in Sub Sahara Africa.
But as the market continues to expand and the companies’ profits climb in Nigeria,there are growing concerns about the quality of service MTN and the othersoffer and as well as their marketing campaigns, which have left consumersfrustrated.
With a population of about 170 million, demand for telecoms services in Nigeriais the largest in Africa. Nigeria is also in the top 10 of the fastest growingtelecom markets in the world. Available statistics shows that as at June 2015 active GSM mobile subscriptionsin Nigeria stood at a little over 140 million, representing 98.31 per cent ofthe market share of the telecoms industry.
MTN leads the market with over 60.7 million subscribers, followed by Globacomwith 37.3 million; Airtel with 235.3 million; and Etisalat with 22.3 million. In 2013, MTN generated N775.3 billion in Nigeria against N638.6 billiongenerated in South Africa, the home country of MTN. The difference represents21 per cent revenue gain in its Nigerian market.
The company’s turnover in other Africa countries is even far lower than whatthey make in Nigeria – Ghana (N133.5b); Cameroon (N83.7b); Ivory Coast (N88.5b)and Uganda (N72.4b).
Though similar data for the three other telecoms companies are not available,the growing number of their subscribers both for voice and data service, ascaptured by NCC, is a reliable indicator of their significant turnover inNigeria.
As the revenues of these ‘big four’ continue to grow, due to growing numbers ofsubscribers, the frustrations of mobile phone users in Nigeria also continue togrow. The problems experienced by users are multiple: dropped calls, failed calls,network interruption, network congestion, failed attempts to load recharge payment,inability to change tariff plan, inability to activate the offered service,inability to send or receive SMS, unsolicited messages without an option to optout, and call misdirection to an unintended number, among other difficulties.
In spite of these challenges, GSM operators continue to attract more subscribersto their networks through all manner of promotions, without simultaneously expandingtheir network capacity. Consequently, most Nigerians are compelled to own morethan one mobile phone. These things breach consumer rights as guaranteed by the Nigerian CommunicationAct 2003 and the Consumer Protection Council Act, LFN 2004. The laws mandatethe NCC to promote the provision of a modern, universal, efficient, reliable,affordable and easily accessible communications service.
Section 4 (1b-d) and 104 of the Nigerian Communication Act give telecomssubscribers a right to high-quality service and value for money. Similarly,section 2 of the Consumer Protection Council Act, LFN 2004, and Regulations2(a-c), 3 and 8 of Quality of Service Regulations 2012 made by NCC emphasisedthe same rights of telecom subscribers.You can hardly have a successfulconversation without three to four breaks in transmission. Sometimes you don’teven hear anything, or the other person does not hear you. Yet the networkproviders charge for this failed call. And the situation appears to be gettingworse by the day.
Customers are legally protected under the United Nations Guidelines forConsumer Protection, otherwise known as the Consumer Bill of Rights. This legalinstrument prescribes a fair settlement of just claims, including compensationfor misrepresentation, shoddy goods or unsatisfactory services. Despite theselegal provisions, consumers’ seeking compensation from telecom companies for providingpoor services meet frustrations.
Some subscribers believe that the regulatory system is too weak to come totheir rescue. The only compensations paid were the fines ordered by NCC forpoor service delivery. No doubt, paying fine is an admissionon the part of the telecoms companies of their poor performance. But while thecompanies pay fine to NCC, they should equally compensate their subscribersdirectly as subscribers are the ones that bear the burden of inefficient servicedelivery.
We commend regulatory bodies’ effortsto sanitize the industry, but urge them to look beyond the imposition of finesin their efforts to ensure that consumers get value for money, since the finesthat have been given so far has notproduced the expected results.