Nigerians will soon have to pay more for GSM calls and SMS as the price floor of calls will increase from N6.4 to N8.95, while the price cap of SMS will increase from N4 to N5.61.
This is sequel to a proposal by telecommunication companies to the Nigerian Communications Commission (NCC) to increase cost of calls, SMS, and data by 40 per cent due to the rising cost of running a business in Nigeria.
According to The Tide’s source, the proposal was contained in a letter written by telecommunications companies under the aegis of Association of Licensed Telecommunication Operators of Nigeria (ALTON) to the NCC.
The letter, titled, “Impact of the Economic and Security Issues on the Telecommunications Sector”, stated that there had been a 40 per cent increase in the cost of doing business in the country.
“The telecommunication industry has been financially impacted following the nation’s economic recession in 2020 and the effect of the ongoing Ukraine/Russia crisis. This has resulted in an increase in energy costs, and increase in operating expenses by 35 per cent”, the letter stated.
It added that the introduction of the recent excise duty of five per cent on telecom services had further increased the burden of multiple taxes and levies on the industry.
“As the Commission may be aware, the power sector under the supervision of its Nigerian Electricity Regulatory Commission of the power sector in November 2020 undertook a review of electricity tariffs to cater for the economic headwinds reported above.
“In view of the foregoing, ALTON considers it expedient for the telecommunications sector to undergo periodic cost adjustments through the commission’s intervention in order to minimise the impact of the challenging economic issues faced by our members”, the letter stated in part.
Giving more details, it continued: “Upward review of the price determination for voice and data and SMS. Given the state of the economy and the circa 40 per cent increase in the cost of doing business, we wish to request for an interim administrative review of the mobile (voice) termination rate for voice; administrative data floor price, and cost of SMS as reflected in extant instruments.
“With respect to voice an SMS cost, ALTON respectfully requests the commission to consider a mark-up approach to address the upward price adjustment desirable for the industry. We have enclosed herein and marked as ‘Annexure 1’our proposal in that regard.
“For data services, we wish to request that the Commission implements the recommendations in the August 2020 KPMG report on the determination of cost-based pricing for wholesale and retail broadband service in Nigeria. Excerpts from the report, are attached and marked ‘Annexure 2’ to provide a further illustration.
“In implementing the said recommendations, however, we recommend that the 40 per cent increase in the cost of doing business be factored in to arrive at a cost price per GB in view of the current economic situation.”
ALTON also requested that to further help telcos during this economic crisis, the NCC should come up with other means of penalising operators rather than punitive monetary sanctions.
They also demanded for an  extension of the payment timeline of relevant regulatory levies and fees; and for the NCC to prevail on the Federal Government to sign the Executive Order declaring telecoms infrastructure as a critical national infrastructure to mitigate cost spent replacing damaged and stolen infrastructures, among other things.