Call & SMS Costs May Rise As NCC Plans New Tariffs

The Nigerian Communications Commission (NCC) has initiated a fresh review of interconnection rates for telecommunications operators, a move that could pave the way for an increase in call and SMS charges for millions of subscribers nationwide.

According to Ireporter Online, the review marks the first comprehensive reassessment of the Mobile Termination Rate (MTR) in eight years. The MTR determines the amount one telecom operator pays another when a customer places a call that ends on a different network. The existing rate currently ranges between ₦3.90 and ₦4.70 per minute.

The review was unveiled during a stakeholders’ consultative forum on Mobile Termination Rates held in Lagos, where industry experts highlighted the need to align the framework with current economic realities and technological advancements.

Speaking at the event, KPMG partner Wole Adenekan explained that significant changes in the telecommunications landscape since 2018 have made a fresh assessment necessary. He cited the depreciation of the naira, rising inflation, increasing energy costs and the growing expense of telecommunications equipment as factors that have significantly altered operators’ cost structures.

Adenekan noted that maintaining rates below actual operating costs could discourage investment in network infrastructure and threaten the long-term sustainability of the industry. He stressed that cost-reflective rates would encourage efficient investment while promoting healthy competition among operators.

He also warned that if interconnection charges are set too high, operators could transfer the additional costs to consumers through higher retail prices for calls and text messages.

The telecommunications expert further observed that the rapid deployment of 5G technology, increased adoption of Artificial Intelligence and Internet of Things solutions, and changing consumer usage patterns have transformed the economics of service delivery, making the existing framework less representative of current market conditions.

He added that the rise of Over-the-Top (OTT) service providers, which offer voice and messaging services over the internet, has also reduced reliance on traditional telecom interconnection services and weakened conventional wholesale revenue streams.

Representing the NCC, the Head of Competition and Tariff Unit in the Commission’s Policy Department, Omotayo Mohammed, described the review as a significant regulatory exercise aimed at ensuring that existing frameworks remain relevant in an evolving industry.

She explained that, beyond reassessing interconnection rates, the Commission would also examine retail price controls and asymmetry arrangements to ensure that consumer interests are adequately protected while maintaining a competitive market.

Mohammed recalled that the current national interconnection rate framework was introduced in June 2018 and later amended in 2022 to address Mobile International Termination Rates. She emphasized that the Commission has consistently adopted periodic reviews to keep its regulations aligned with changing market dynamics.

According to her, the telecommunications sector has experienced remarkable growth over the past eight years, driven by the commercial rollout of 5G technology, the emergence of Mobile Virtual Network Operators and other new ecosystem participants, alongside shifting competitive conditions.

She also pointed to the impact of macroeconomic factors, including exchange rate fluctuations and persistent inflation, which have substantially increased the cost of delivering communications services across Nigeria.

Mohammed maintained that regulatory policies must evolve alongside industry developments, stressing that the Commission is acting within the provisions of the Nigerian Communications Act 2003 to ensure telecommunications tariffs remain reasonable, cost-reflective and non-discriminatory while supporting sustainable growth in the sector.