MTN Seeks NCC’s Approval For 100% Tariff Increase

The Chief Executive Officer of MTN Nigeria Communications Plc, Karl Toriola has revealed that telecom companies applied for approval of 100 per cent increase in tariff.

The MTN CEO made the disclosure on Thursday in an interview monitored by THE WHISTLER.

The tariff hikes cover all telecom services including voice and data.

Toriola’s comment comes in the wake of calls for an increase in tariff of cost issues.

Telecom operators have decried the rising cost of operations which is threatening their survival.

But the Nigerian Communications Commission (NCC) has stalled the approval over hardship faced by consumers.

The Minister of Communication and Digital Economy, Bosun Tijani in a recent interview said there is more to the communication sector than the tariff review.

But Toriola said “The cost we are expending are actually exceeding our revenue. Even though we are seeing revenue growth and there is no way that the industry can continue to sustain itself and provide the required quality of service under this structure.

“We have put forward the request of approximately 100 per cent in tariff increases to the regulators. I doubt they are going to approve that quantum of increases because they are very sensitive to the current economic situation in the country.

“But we are hopeful and optimistic that the realities are steering us in the face and the right decision will be taken for the sustainability of the industry.”

The MTN boss admitted the government has been supportive of the industry with regulations like the National Infrastructure Bill which protects telecom infrastructures as national assets.

But Toriola lamented that the telecom sector has a problem of sustainability.

The CEO said, “Yes everyone in Nigeria has gone through difficult time in the last few years due to inflation and devaluation, etc but the challenge that we face is not about profitability. It is about sustainability.

“If you imagine a company that four or five years ago earned N1tn and was making 10 per cent profit- N100bn. The total cost put together was N900bn. Subsequently, two or three things happened like devaluation of the naira.

“Official exchange has gone up from about N420/$ or N450/$ to N1550/$ at the end of the year. So, that has driven our cost structures up drastically. Diesel has gone from pre-COVID-19 times of N200-N300/litre to N1000; petrol has gone up several folds. Power generation and the cost of procuring material.”

He said raw materials in the sector include batteries, fibre cables and base station towers.

Toriola explained that network service providers pay software licensing fees for the networks adding that the costs have risen astronomically.

MTN Seeks NCC’s Approval For 100% Tariff Increase is first published on The Whistler Newspaper