How has the hike in data and mobile phone call prices affected Nigerians?

Summary

Africa Daily: The Impact of Rising Data and Mobile Call Prices on Nigerians
BBC World Service, Hosted by Alan Kasujja | Released on February 24, 2025

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Introduction

In this episode of Africa Daily, host Alan Kasujja delves into the significant increase in data and mobile phone call prices in Nigeria and explores the multifaceted effects of this hike on the daily lives and businesses of Nigerians. Released on February 24, 2025, the episode provides an in-depth analysis of the telecommunications sector's recent adjustments and their broader socio-economic implications.

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Background: The Telecommunications Price Hike

Earlier in the year, Nigerian telecommunication companies announced a substantial price increase of up to 50% across various services. This surge affects millions of Nigerians who rely heavily on mobile data and call services for both personal and professional uses. To contextualize the impact, the minimum wage in Nigeria has remained stagnant at below 50,000 naira (approximately $33) per month for years, exacerbating the financial strain caused by these price hikes.

Alan Kasujja outlines the specifics of the increase:

• Data Costs: Previously priced at 350 naira (~$0.25) per gigabyte, data now costs 525 naira (~$0.35) per gigabyte.
• Call Rates: Calls now cost 16.5 naira (~$0.01) per minute, up from lower rates that had remained unchanged for decades.

“The hike is so ridiculous, it's really bad,” states Tawfik Adeshina, highlighting the widespread frustration among Nigerians.

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Interview with Yusuf Akinpelo: Understanding the Causes and Initial Reactions

Yusuf Akinpelo, a BBC reporter based in Lagos, provides a comprehensive overview of the reasons behind the price increases. According to Akinpelo, the telecommunications companies justified the hike by citing increased operational costs, including:

• Utilities and Power Plants: Rising expenses in maintaining and powering their infrastructure.
• Overhead Costs: Escalating costs associated with running their facilities amid Nigeria’s economic challenges.

These explanations were supported by the Nigerian government, which emphasized the necessity of maintaining business viability amidst escalating costs. However, many Nigerians were taken aback by the abrupt announcement, as there was no prior notification or sufficient communication from the telecom providers.

Key Quote:
"We had a meeting with the government and then a committee was set up to see what they can do to ameliorate the situation. But sometimes, more often than not, the said committees are often just a way of buying time or just dousing the tension," explains Akinpelo [07:05].

Akinpelo also points out that this hike is unprecedented in its magnitude compared to previous increases, where data and call prices remained relatively stable for nearly two decades. The substantial rise in costs, without a corresponding increase in wages, has intensified the financial burden on Nigerians.

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Personal Impact: Tawfik Adeshina’s Story

Tawfik Adeshina, a photographer and social media influencer, shares his firsthand experience of how the price hike has affected his livelihood. As someone who relies heavily on data for his work, the increase has had a profound impact:

• Data Subscriptions: Tawfik's annual subscription, previously 100,000 naira for one terabyte, has surged to 150,000 naira for the same amount of data, now lasting only six months.

  Quote:
  “The hike is so ridiculous and all that. So it's really bad,” expresses Tawfik [10:51].

• Data Usage: With daily usage exceeding 20 gigabytes across multiple network providers, the increased costs have made it challenging to sustain his professional activities.

  Quote:
  “On a daily basis, I use nothing less than 20 gigabytes in a day,” Tawfik explains [11:09].

Despite the higher prices, network reliability has not improved. Tawfik notes frequent connectivity issues, which hinder his ability to upload work and communicate effectively with international clients.

Quote:
“It's very sad because despite the fact that they increased the data tariff, we have been witnessing a very low network,” he remarks [11:36].

The lack of improved service despite higher costs has led Tawfik and others in the creative industry to seek alternative solutions, such as collaborating to invest in Starlink's broadband Internet service.

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Government and Industry Response

In response to public outcry and potential strikes from labor unions, the Nigerian government established a committee to address the issue. However, Yusuf Akinpelo remains skeptical about the committee's effectiveness:

Quote:
“I doubt there would be a reversal in the price because the government isn't so keen to subsidize anything at the moment,” Akinpelo comments [07:37].

The anticipated measures, such as tax rebates or subsidies, are viewed as insufficient to counterbalance the steep price increases without broader economic reforms, including adjustments to the minimum wage.

Quote:
“If you're increasing what people are buying, so too should what you are paying people,” Akinpelo insists [09:27].

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Broader Socio-Economic Implications

The price hike has far-reaching consequences beyond individual hardships:

• Economic Strain: Increased costs for essential communication services exacerbate the already tight budgets of Nigerians living on low wages.

• Business Sustainability: Entrepreneurs and small businesses, especially those in digital and creative industries, face difficulties maintaining operations due to higher operational costs.

  Quote:
  “You also have amount of presence online. So the only oxygen they are using to stay afloat in this ecosystem is data,” Akinpelo explains [05:37].

• Access to Services: The high cost of data restricts access to digital banking, online education, and other critical services that depend on reliable internet connectivity.

Tawfik Adeshina warns of potential further hikes, which could lead to more businesses shutting down and increase poverty levels.

Quote:
“I'm actually scared for the next couple of months or years when they tend to increase it more,” Tawfik states [13:11].

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Conclusion: The Road Ahead

The episode underscores the urgent need for a balanced approach to managing telecommunications costs in Nigeria. While companies cite legitimate reasons for the price increases, the lack of effective communication and insufficient government intervention leave many Nigerians struggling to adapt. As the situation evolves, stakeholders on all sides face the challenge of ensuring that essential communication services remain affordable and accessible to sustain both personal livelihoods and the broader economy.

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Credits

Today's episode was produced by Victoria Nwo Honda and Sharon Immons, with editing by Rosanna La Falche and Simon Peeks. Africa Daily is a BBC World Service production. For more insights, listeners are encouraged to check out the sister podcast, Focus on Africa, which covers three major African stories each day.

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Notable Quotes with Timestamps:

• Tawfik Adeshina [01:11]: "The hike is so ridiculous, it's really bad."
• Yusuf Akinpelo [07:05]: "I doubt there would be a reversal in the price because the government isn't so keen to subsidize anything at the moment."
• Tawfik Adeshina [10:51]: "The hike is so ridiculous and all that. So it's really bad."
• Yusuf Akinpelo [09:27]: "If you're increasing what people are buying, so too should what you are paying people."
• Tawfik Adeshina [13:11]: "I'm actually scared for the next couple of months or years when they tend to increase it more."

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This comprehensive overview captures the essence of the episode, highlighting the critical issues surrounding the telecommunications price hike in Nigeria and its profound impact on the population.

Transcript

[Ryan Seacrest]

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[Alan Kasucha]

Btw, being online has now become a huge part of our lives. Everywhere you look you see people on their phones. At home, at school, at work, in the markets, everywhere. And these devices are not just almost glued in our hands for fun, they are also crucial to people's businesses and livelihoods. So when the Nigerian telecommunications raised their prices, they got this sort of reaction.

[Tawfik Adeshina]

The hike is so ridiculous, it's really bad.

[Alan Kasucha]

Tawfik Adeshina isn't alone. He's one of hundreds of millions of Nigerians who are online and feeling this extra pinch. And, and some of the services have seen up to 50% hike affecting millions of citizens. Just to put it all in perspective for you, the minimum wage in Nigeria has hovered below 50,000 naira, or about $33 a month for years. So today we are asking how has the data and phone hike in prices affected Nigerians? Hi, I'm Alan Kasucha and this is Africa Daily. Yeah, you heard right. Earlier this year, the Nigerian telecommunication companies announced that they would be hiking their prices up to 50%. To give you a flavor of what this new hike looks like in real terms and money, whereas before Nigerians were being charged 350naira, which is about 25 cents for gigabyte of Internet data, they would now have to pay 525naira or call that 35 US cents. And if you want to call a loved one, be ready to fork out 16.5 Naira or just over 1 cent per minute. So as you'd imagine, this has caused a big shock across the country and many Nigerians are properly vexed. Before we get to hear more from Tawfi Kadeshina, let's bring in someone who's been following this story. Our reporter in Lagos, Yusuf Akinpelo Hu, also has a story on how this change has already affected his personal life. First though, I wanted to get a sense from him about what's been happening and what Led to these huge changes.

[Yusuf Akinpelo]

Telecommunications companies in Nigeria, they had been pushing hard. The reason they gave was basically saying the charges were necessary to ensure that they are still in business. They say because of the need for utilities, things like buying, powering their many power plants, Also the cost of their overhead, running costs of operating all of their facilities, they said because things are now more expensive in Nigeria. So surely they have to increase the price that they charge for calling and buying data. That was the basic and the simplest of explanation. They gave the other technical explanation, which the government, by the way, sided with, to say if you need for them to still be in business, they need to increase their price. And that came as a shock to many Nigerians. Even the prices of different things they're buying ordinarily has increased. But they just still felt in this age of digital age, where you need to be connected to reach your loved ones and to talk to people, now it's pretty much more expensive. Just to give this a bit of personal feel. I was talking to my wife the other day and she ran out of data. We could not continue to talk. And then she called me back after a couple of minutes to say she was shocked that what she ordinarily would buy for say 6,000, now it goes for 9,000. And that 3,000 is more than $2. The shift of her having to make that sacrifice within that short time wasn't something she was planning to do. There was no prior notification or any form of information to tell people that this was coming, even though they knew it might come.

[Alan Kasucha]

Some people say it just makes sense. If your operational cost goes up, someone has to bear that cost. And you, if you are to remain in business, you have to remain profitable and also demand supply. Market forces are at play here.

[Yusuf Akinpelo]

People will say that wouldn't be wrong. Of course, if the cost of your production is high, of course the cost of your product too will be high. The fact that the communication of this process, it wasn't exactly done as it ought to be done, at least in my case and many other people around me, there wasn't exactly any circular or memo to say expect this or maybe do any form of ad to tell people, this is what we're bringing on board. This is what we're doing. This is what we're doing when people know about it when they were at the point of purchase. Now you now see that what you bought for a dollar yesterday is now like $3 today. You then wonder what happened between yesterday and today. The fact that you have to pay more for everything now food, fuel, transport. And the only thing that seemed to remain very constant data and calling, now it's up also. And for a country like Nigeria that has high Internet penetration, high amount of digital banking among Nigerians, there's also amount of presence online. So the only oxygen they are using to stay afloat is in the course of this ecosystem is data. And now that it's more expensive, it would only make the people more impoverished.

[Alan Kasucha]

Very interesting thoughts, but I wonder what is being done to rectify the situation. I'm told a committee was set up.

[Yusuf Akinpelo]

Prior to when this announcement was made. Labor union came out to say they were going to protest, they were going on strike and except the government intervened on the eve of the said protest was when they had a meeting with the government and then a committee was set up to see what they can do to ameliorate the situation. But sometimes, more often than not, the said committees are often just a way of buying time or just dousing the tension, not necessarily addressing the issue. I doubt there would be a reversal in the price because the government isn't so keen to subsidize anything at the moment. And the only way the telecommunications might be willing to return to the former price would be if the government is willing to give some concession, maybe giving some tax rebates or giving some subsidy to people. But the ship has sailed already, right?

[Alan Kasucha]

And when was the last time there was such a hike in the cost of data?

[Yusuf Akinpelo]

If you want to send just one page text message, it would cost you four naira. At least in the most recent memory that I remembered that has been fixed for more than almost a decade or two. It has never changed. So now it is six naira to send text message data varied from telecommunication to telecommunication. The atarif while it happened about a year or two ago for some of the telecommunication, in terms of data, it wasn't as drastic and noticeable as it is now. The fact that the same amount of data that you would buy for 6,000 naira would have been 9,000 naira. It wasn't so in the past hikes. So this one was significant because of the rate at which the percentage with which they were increased. So that's why it's been more felt by people.

[Alan Kasucha]

So if they haven't raised the prices in decades, come on, a small hike now should not be too big a deal. It's been a party for a long time, you know, now is a good time to increase and maybe, who knows, they might not raise the rates again for another couple of decades.

[Yusuf Akinpelo]

Well, if that's the case, then the increase in minimum wage should also come with similar amount of increase. So if you're increasing what people are buying, so too should what you are paying people. And I only talked about the almost like two decades for data. I mean text message. The data like gradual increase in recent times, but not as much as it is now. That's drastic. That does not reflect in what people are earning and what people are buying outside. So that's why it's much of a big deal for people.

[Alan Kasucha]

Now. Tutor Fik Adesina, the voice you heard at the start of this episode who called the hikes ridiculous, is a photographer and social media influencer. So much of his life and livelihood depend on being connected on being online. So how have these hikes affected him and his business?

[Tawfik Adeshina]

I use high data read and all that. So I normally do a year subscription and that is a hundred thousand naira for one terabyte. But presently the current price for that is one hundred fifty thousand naira for one terabytes. And it's not for a year, it's just for six months.

[Alan Kasucha]

So the data you'd have used for a year is now only lasting you six months?

[Tawfik Adeshina]

Exactly.

[Alan Kasucha]

That's a significant hike in price.

[Tawfik Adeshina]

It is. The hike is so ridiculous and all that. So it's really bad.

[Alan Kasucha]

So it has affected you because you use a lot of data for your work. Give me a sense of how you use your data. Where does the most of it go?

[Tawfik Adeshina]

On a daily basis, I use nothing less than 20 gigabytes in a day. I don't sub only on a network provider. I use four network providers because most of the time I might actually find myself in a remote area where I don't get network and all that.

[Alan Kasucha]

Wow, that's a lot of data. And does the hike in price also mean better services, more reliable lines? Just trying to talk to you now. We were having problems connecting.

[Tawfik Adeshina]

It's very sad because despite the fact that they increased the data tariff, we have been witnessing a very low network. Like you sometimes go days without having very strong network to use. Like for me, I tend to like put most of my works in a server where my international clients could actually get to see my works and all that. But then because of these issues, it has really reduced my work output and all that.

[Alan Kasucha]

Now you're not the only one. I wonder if there are other people in that creative space, other people who do similar work, people who depend on data for their livelihood. They must also have been very badly impacted.

[Tawfik Adeshina]

Yeah, it has really negatively impacted us in the sense that on a daily basis we depend on these things and then without data it just seems like we are off the grind and all that. It's really sad that this is happening and even if they want to increase it, there should have been a kind of efficiency in their network. Like you increased the data tariff and still yet the network is getting bad as it was. If you want to send a file of not less than 5 gigabytes, it is to use nothing less than 5 minutes, 5, 10 minutes before putting. For now, you can be sitting on it one hour, one and a half hour and you're still not getting this five cent and all that. Like it slows down and works and all that.

[Alan Kasucha]

Tofik says he and his friends are looking for other options and ways to work around these price hikes. And one of the options they're exploring is coming together as a group and buying into Starlink, the company owned by Elon Musk that provides broadband Internet, a way of circumventing those high costs should they remain. Do you see people losing business, shutting down shop because it's no longer sustainable? This might not be the last hike.

[Tawfik Adeshina]

You know, exactly like the POS agents who mostly depend on mobile data in order to make their daily business runs and all that. Like, I believe this is definitely going to affect their business and they've actually increased these tariff plans because it just seems like we are seeing the first phase of the increase. But sadly, I'm actually scared for the next couple of months or years when they tend to increase it more and all that.

[Alan Kasucha]

And Tawfiq and millions of other Nigerians watch and wait for possible further price hikes. It's a story that's affecting many in Nigeria, be it in a professional or personal way, and a story we'll keep across and keep you updated on Africa Daily. Many thanks to Tawfik Adesina for his condor and Yusuf Akimpelu for explaining this to us. Africa Daily, a BBC World Service production. Today's episode was produced by Victoria Nwo Honda and Sharon Immons. Our editors are Rosanna La Falche and Simon Peeks. Now, don't forget to check out our sister podcast Focus on Africa, for a look at three major Africa stories of the day. As always, we'd love to hear from you, whether on this episode or anything else you've heard. Africadaliabpc.co.uk or get in touch with me on X, my handle at Kasucha, and that's with two Js. Thank you for listening.

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[Alan Kasucha]

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[Ryan Seacrest]

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