MTN Nigeria CEO Reveals 100% Tariff Increase Request

Chief executive officer Karl Toriola of MTN Nigeria revealed that telecom operators had asked for a 100 percent rise in their rates.

However, he pointed out that given how sensitive it is to the nation’s current economic circumstances, the Nigerian Communications Commission (NCC) is unlikely to sanction that amount of hikes.

“But we are hopeful and optimistic that the realities are staring us in the face and the right decision will be taken for the sustainability of the industry,” he said on Arise TV on Thursday.

The head of MTN claims that the telecom industry is currently struggling with sustainability as a result of rising operational costs brought on by inflation and the depreciation of the naira.

The authorities are aware of the situation and are working to address it, he said.

For the past ten years, telcos have advocated for an increase in tariff costs, but in 2022, they suggested a 40 percent boost.

However, record losses since 2023 after a significant devaluation of the naira have further compounded telcos’ woes, increasing their requests for tariff hikes.

After losing N137 billion in 2023, MTN declared N514.93 billion as a loss for the nine months ending September 2024, despite a 33.7 percent growth in service revenue to N2.37 trillion. Similarly, Airtel’s revenue fell by 46.9 percent to $755 million during the same period.

Toriola, CEO of MTN, recently emphasised, “There should be no delusion; if the tariff doesn’t go up, we will shut down.”

Toriola clarified on Thursday that the industry’s current problem is sustainability rather than profitability because it is unable to pay its operating expenses.

“The costs we are expending are exceeding our revenue even though we are seeing revenue growth. There is no way the industry can continue to sustain itself and provide the required quality service under this structure,” he stated.

According to industry stakeholders, the fate of the telecoms industry in 2025 will be shaped by tariff conversations.

There are indications that the regulator is set to approve increases, with the CEO of a tier-one telecom company who said, “It has not been approved, but they are likely to do it soon.”

Bosun Tijani, the minister of Communications, Innovation, and Digital Economy, recently acknowledged in a statement, “We think there may be a need for that.”

He noted, “Beyond the conversation about increase in tariff, which is what everyone has been talking about, yes, there may be a need for it, but there is so much that we need to do as a country to ensure that the sector is competitive.”

Manomsi Mallum/ BusinessDay