The Nigerian Communications Commission (NCC) has initiated a review of interconnection tariffs for telecommunications operators, a move that could lead to increased call and SMS charges for subscribers nationwide.
The review comes eight years after the last major assessment of the Mobile Termination Rate (MTR), the fee paid by one network operator to another when a call is completed on a different network. Current interconnection rates range between ₦3.90 and ₦4.70 per minute.
Industry experts say adjustments to these rates could eventually impact retail pricing for consumers. However, the NCC maintains that the exercise is intended to ensure tariffs remain fair, cost-reflective, and aligned with current market realities.
The announcement was made during a stakeholders’ consultative forum on Mobile Termination Rates held in Lagos on Tuesday.
Speaking at the event, KPMG partner Wole Adenekan said the review had become necessary due to significant economic and technological developments since the last rate determination in 2018.
According to Adenekan, factors such as naira depreciation, rising inflation, escalating energy costs, and increasing telecommunications equipment expenses have substantially altered the operating environment for telecom providers.
He noted that setting interconnection rates too low could discourage investment in critical network infrastructure and undermine the industry’s long-term sustainability.
“Rates that fail to reflect actual costs can weaken investment incentives and hinder network expansion,” he said.
Adenekan also warned that improperly structured termination rates could create competitive imbalances, potentially allowing larger operators to disadvantage smaller rivals.
Consumers Could Feel the Impact
While advocating a balanced regulatory approach, Adenekan cautioned that excessive increases in termination rates could ultimately be passed on to subscribers through higher call and messaging charges.
He observed that the telecommunications industry has evolved significantly over the past eight years, driven by the rollout of 5G services, increased adoption of Artificial Intelligence (AI) and Internet of Things (IoT) technologies, and changing consumer usage patterns.
According to him, these developments have transformed network costs and service delivery models, making existing interconnection frameworks less reflective of current market realities.
He also pointed to growing competition from internet-based communication platforms, commonly known as Over-the-Top (OTT) services, which have reduced reliance on traditional voice and messaging services and weakened conventional wholesale revenue streams.
NCC Assures Consumer Protection
In her remarks, the Head of Competition and Tariff Unit at the NCC, Omotayo Mohammed, described the review as an important regulatory exercise designed to align industry policies with ongoing changes in the telecommunications sector.
She explained that the review would assess not only interconnection rates but also existing retail pricing controls and market asymmetry arrangements to ensure that consumer interests remain safeguarded.
Mohammed noted that Nigeria’s telecommunications landscape has undergone significant transformation since the current framework was introduced in 2018, citing rapid market growth, evolving competition, the deployment of 5G technology, and the emergence of Mobile Virtual Network Operators (MVNOs).
Economic Pressures Driving Review
The NCC official further highlighted the impact of broader economic conditions on telecom operators, noting that inflation and exchange rate fluctuations have significantly increased the cost of delivering communications services across Nigeria.
She stressed that regulatory frameworks must continue to evolve alongside industry developments to remain effective and responsive.
According to Mohammed, the Commission is acting within its mandate under the Nigerian Communications Act 2003 to ensure that telecommunications tariffs and charges remain reasonable, transparent, non-discriminatory, and reflective of prevailing economic realities.
The outcome of the review is expected to shape future pricing structures within the telecommunications sector and could influence the cost of voice and messaging services for millions of Nigerian subscribers.
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