Big Trouble For Subscribers As NCC Signals Possible Increase In Call Charges

The Nigerian Communications Commission (NCC) has begun a review of interconnection rates for telecommunications operators, a move that could lead to increased call and SMS charges for millions of subscribers across the country.

The review comes eight years after the last comprehensive adjustment of the Mobile Termination Rate (MTR), a key industry benchmark that determines the fee network operators pay one another when calls are terminated on different networks.

Currently, interconnection charges range between ₦3.90 and ₦4.70 per minute.

Industry stakeholders warn that any upward adjustment could eventually be passed on to consumers, potentially raising the cost of communication services. However, the NCC maintains that the review is intended to ensure that tariffs remain fair, cost-reflective, and aligned with current market conditions.

The development was announced at a stakeholders’ consultative forum on Mobile Termination Rates held in Lagos on Tuesday.

Speaking at the forum, a partner at KPMG, Wole Adenekan, said the review had become necessary due to significant economic and technological shifts since the last determination in 2018.

He explained that factors such as naira depreciation, inflation, rising energy costs, and the high expense of telecom equipment have significantly altered operators’ cost structures.

According to him, setting rates too low could discourage investment in infrastructure and weaken the long-term sustainability of the sector.

“Rates that are too low would fail to reflect the true cost of providing termination services and can deter infrastructure investment,” Adenekan said.

He added that appropriately structured rates encourage efficiency and support broader economic growth, while warning that poorly calibrated pricing could distort competition and disadvantage smaller operators.

Adenekan further noted that excessive termination charges could ultimately be transferred to end users in the form of higher retail prices.

He said the telecom sector has undergone major transformation in the past eight years, making the existing pricing framework outdated.

He pointed to the rollout of 5G technology, increased use of artificial intelligence and Internet of Things (IoT) solutions, and changing consumer behaviour as factors reshaping network usage and cost dynamics.

According to him, competition from over-the-top (OTT) service providers offering voice and messaging through the internet has also reduced reliance on traditional telecom interconnection models.

While noting that the NCC reviewed international termination rates in 2022, he said the domestic MTR framework established in 2018 has remained unchanged.

In her remarks, the Head of the Competition and Tariff Unit at the NCC, Omotayo Mohammed, described the review as a key regulatory step aimed at aligning industry pricing with current realities.

She said the exercise would also assess retail price controls and existing asymmetry arrangements to ensure consumer protection.

Mohammed noted that the telecommunications market has changed significantly since the 2018 framework was introduced, with rapid expansion, evolving competition, and the emergence of new players such as Mobile Virtual Network Operators.

She added that macroeconomic challenges, including exchange rate fluctuations and inflation, have significantly increased the cost of providing telecom services in Nigeria.

According to her, regulatory frameworks must evolve alongside industry changes to remain effective.

Citing the Nigerian Communications Act 2003, she said the Commission is mandated to ensure that tariffs remain reasonable, cost-reflective, and non-discriminatory.