Nigeria: Telecom Spending Reaches N3.86tn Due to Increased Video Streaming and Calls, Reports NCC

The amount spent on telecom services in Nigeria reached N3.86tn in 2022, primarily driven by heightened video streaming and talk time, as stated in the Nigerian Communications Commission’s (NCC) ‘2022 Subscriber/Network Data Annual Report.’

This expenditure marked an 18.74% surge from the N3.25tn spent in 2021, illustrating the sustained growth in the country’s reliance on telecom services.

A detailed analysis of the revenue distribution showed that GSM operators generated N3.33tn, fixed wired operators made N385.07m, internet service providers contributed N92.08bn, value-added service providers accounted for N40.74bn, collocation and infrastructure sharing operators earned N3.29bn, and other telecom operators recorded N5.59bn in revenue.

While the telecom service providers accumulated N3.86tn in revenue, they allocated N2.88tn for operating costs and capital expenditure, resulting in a profit margin of N977.44bn (pre-tax).

According to the NCC, the total count of active subscribers surged by 13.86%, reaching 222,571,568 active voice subscriptions by the close of 2022, compared to 195,463,898 subscriptions in 2021.

The NCC attributed the growth in subscriber numbers to various factors such as subscriber loyalty, promotions, seasonal effects, robust consumer acquisition campaigns, and competitive product offerings across networks. Additionally, the lifting of the ban on new SIM registration and sales, SIM swaps, and porting activities after the subscriber registration database audit also contributed to the increase.

This rise in active subscriptions positively influenced other telecom indicators like teledensity, Internet penetration, and broadband penetration.

The growth in data usage, attributed to increased video streaming due to higher smartphone usage, saw a 46.77% surge, reaching 518,381.78TB in 2022 from 353,118.89TB in 2021.

The volume of data consumption grew, with subscribers consuming 518,381.78TB by December 2022, compared to 353,118.89TB in December 2021, marking a 46.77% rise in data consumption.

Furthermore, the number of Internet subscribers increased by 9.06%, reaching 154.85 million in 2022, up from 141.97 million subscriptions in December 2021.

Broadband service adoption expanded, with penetration growing from 40.88% to 47.36%, and subscriptions increasing from 78,041,883 in December 2021 to 90,398,960 by December 2022.

Outgoing local and national call traffic also experienced a surge in 2022, reaching 204,091,441,469.16 minutes, a 17.59% increase from the 173,555,413,817.69 minutes recorded in 2021.

SMS communication maintained its relevance, with the total number of national SMS sent and received reaching 25,928,704,567 by December 2022, marking a 28.82% increase from the 20,126,551,822 SMS recorded in 2021.

Telecoms remain a crucial driver of the Nigerian economy, serving as the backbone of communication and connecting various sectors.

Recently, Prof. Umar Danbatta, the Executive Vice Chairman of the NCC, revealed that the telecoms sector had attracted $75.6bn worth of investments by the end of 2021.