Telecoms tariff hike will hinder learning, research – students lament
A cross section of students in Enugu State, on Wednesday, appealed for the reversal of the 50 per cent hike in tariff in telecommunication services due to prevailing socioeconomic hardship. They were of the view that telecommunication services, such as internet data service, have enhanced learning and research work; making its usage indispensable to all students. They made their feelings known in separate interviews while reacting to the telecom tariff hike with the News Agency of Nigeria (NAN). READ ALSO: Why Nigerians should not pay tax Mr Divine Eze, a student of the Department of Environmental Management in the University of Nigeria Enugu Campus (UNEC), urged the Nigerian Communications Commission (NCC) and telecom companies to consider the financial struggle of students and their parents. Eze said that currently most students could not easily cope with the high cost of textbooks and other educational materials, which cost increased in the past few years. “The only relief we have for now is the telecommunication services that had helped students to manage; thus, reducing need for travels, time doing research and writing same research work and essential social media communication,” he said. Speaking, a student of the Institute of Management and Technology (IMT), Mrs Chiamaka Dike, called on NCC and telecom companies not to put an increase in data service as it impacted negatively on learning and education the more. “Usage of data have made me to manage the N2,000 that my parents usual give to me monthly for GSM services. “Many other students I know go through such strict condition by using only data only when necessay,” Dike, who is of the Department of Banking and Finance, said. Corroborating, Mr Chidiebere Chimdobe, a student of the Enugu State University of Science and Technology (ESUT), noted that NCC and telecom companies failed to consult and carry all telecom stakeholders along in pushing for the hike. READ ALSO: Tinubu appoints Opeifa as NRC Managing Director Chimdobe said that the telecommunication services drove millions of soft job or e-jobs which students and fresh graduates engage in within the past 10 years. According to him, NCC and telecom companies are thoroughly insensitive to the hradship, daily struggles and difficult plights of Nigerian youths, which majority are students. “If they go ahead with the hike, it will further compound hardship and will increase social vices as well,” he said. Meanwhile, the Progressive Students Movement (PSM), a pan-African students movement, has given an ultimatum of 72-hour to NCC and telecom companies to reverse recent 50 per cent hike in tariff. The President of PSM, Mr Bestman Okereafor, called for the review and reversal in a statement made available to newsmen in Enugu. Okereafor noted that the 50 per cent increment at this time is “unjustifiable, untimely, and insensitive; hence the total rejection of this anti-masses increment.” According to him, PSM is calling on NCC and telecommunications companies to review its stance as a matter of urgency. He said, “The attention of PSM has been drawn to NCC’s approval of Telecom operators 50 per cent tariff increment. READ ALSO: CBN moves to end trade in Naira notes “It will be recalled that telecom operators had previously demanded to adjust their tariff rate; a request which many Nigerians especially Nigerian students frowned at. “Information at our disposal shows that NCC approved the telecom companies request in response to rising operational costs, at the detriment of Nigerians and the obvious economic realities facing the country. “However, this development, which allows for a maximum of 50 per cent adjustment to current tariffs, was announced in a statement signed by Reuben Muoka, the NCC’s Director of Public Affairs, on Monday, Jan. 20.” The PSM President warned that the entire students’ bodies would be protesting this abnormal and inconsiderate 50 per cent increment in tariff if not reviewed in the next 72 hours.
Ex-MTN Group CEO, Sifiso Dabengwa Is Dead
Former MTN Group CEO, Sifiso Dabengwa, has reportedly died, succumbing to cancer after a hard fought battle
Interconnect Debt Dispute Resolved Between MTN Nigeria and Glo
In a recent announcement by the Nigerian Communications Commission (NCC), the interconnect debt dispute between MTN Nigeria Communications Plc and Globacom Limited has been successfully resolved. The resolution comes within the 21-day grace period provided by the NCC, as highlighted in a statement by the Director of Public Affairs, Reuben Muoka. Previously, the NCC had issued a warning in January, stating that Glo subscribers might face restrictions on making calls to MTN lines due to unresolved interconnect charges. The potential disconnection could have affected 61.54 million mobile subscriptions on Glo’s network. The NCC extended its notice period to allow both companies to reach an agreement, taking into consideration the impact on subscribers. In the recent statement, the NCC confirmed the amicable resolution of the dispute and withdrew the disconnection approval granted to MTN. The statement emphasized the NCC’s commitment to strict adherence to the terms and conditions of licenses, especially those outlined in interconnection agreements. Additionally, the commission expressed its proactive approach to preventing future instances of interconnect indebtedness within the industry. This includes requesting relevant records and regular updates from Mobile Network Operators (MNOs) and adopting a transparent approach to industry indebtedness.
Tax Tribunal Orders MTN To Pay FIRS $72.6m
It was a win-win situation for both MTN Nigeria and the Federal Inland Revenue Service (FIRS) as the Tax Appeal Tribunal sitting in Lagos ordered the telecommunications giant to pay the sum $72,551,059 in unpaid tax but ruled that it is not liable to pay $21,039,807 as penalties and interest on the principal tax amount. The amount is said to be unpaid taxes between 2007 and2017. The verdict was delivered by a five-person panel led by Professor A. B. Hamed in response to an appeal (TAT/LZ/VAT/075) filed by MTN Nigeria against the FIRS’s request for payment of the outstanding tax. The case arose from a report issued by the Office of the Attorney General of the Federation in May 2018, which investigated MTN’s Forms A and M transactions covering the accounting years from 2007 to 2017. A revised report in August 2018 adjusted the alleged outstanding import duty and value-added tax (VAT) to N242.2 billion for Form M-visible transactions and $1.284 billion for Form A-invisible transactions. In July 2021, the FIRS issued a VAT assessment of $93,590,366 million to MTN Nigeria, comprising $72,551,059 million as the principal liability and $21,039,807 million for penalties and interest on the principal sum (first assessment). MTN Nigeria objected to the first assessment, leading to a further review by the FIRS. In a notice of assessment dated April 14, 2022, the FIRS issued a revised assessment of $135,697,755 million to MTN. While the principal tax liability in the revised assessment was lower than the first assessment at $47,776,210 million, the interest and penalty imposed by the FIRS in the revised assessment were higher at $87.9 million. MTN Nigeria lodged an objection to the revised assessment, which was refused by the FIRS in a letter dated June 16, 2022. The Tax Appeal Tribunal, after considering all the submitted documents and citing legal authorities, ruled in favour of the FIRS on issues one to four and ordered MTN to settle the assessed tax liabilities. However, it ruled in favour of MTN on issue five, which concerned penalty and interest, and set aside the related penalties. MTN has been ordered to pay the assessed tax liability of $72,551,059 while being relieved of the associated penalties and interest.
Despite Challenges Telcos Meeting KPIs—NCC
The latest data from the Nigerian Communications Commission (NCC) shows that the four mobile network operators, MTN, Globacom, Airtel, and 9mobile, are meeting their Quality of Service (QoS) Key Performance Indicators (KPIs). According to the Nationwide QoS data released by the Commission, the telcos met their KPIs between July 2022 and June 2023. The operators’ performances are measured by the regulator based on parameters such as Call Setup Success Rate (CSSR), Drop Call Rate (DCR), and Traffic Channel Congestion (TCH CONG). According to NCC, these QoS standards ensure that consumers continue to have access to high-quality telecommunications services by setting basic minimum quality levels for all operators. Based on the latest report, all the mobile operators crossed the threshold of 98 per cent call setup success rate in the 12-month review period. The Call Setup Success Rate (CSSR) is calculated by taking the number of unblocked call attempts divided by the total number of call attempts. In terms of drop call rate (DCR), which is fixed at 1 per cent or less, all the operators performed well as they recorded less than 1 per cent drop calls in the period, according to NCC’s record. A dropped call is a call that is prematurely terminated before being released normally by either the caller or the called party. In terms of Traffic Channel Congestion, (Standalone Dedicated Control Channel Congestion SDCCH), all the operators also met the KPI as they all recorded less than 2 per cent congestion within the period. The regulator’s parameter in this regard is that the congestion rate for the networks should be equal to or less than 2 per cent. The Traffic Control Channel Congestion Rate is the probability of failure to access a traffic channel during call setup. The technical result of operators’ quality of service may, however, be different from the reality based on subscribers’ experience in the period covered by the report and even now. The President of the National Association of Telecoms Subscribers (NATCOMS), Mr. Deolu Ogunbajo disagreed with the regulator. According to him, NCC is looking at the quality of service from the technical aspect and not from the subscribers’ angle. “The KPIs are measured technically and are far from the reality of what the subscribers are experiencing. We disagree with NCC on this. There are lots of complaints on Dropped calls, and even the call setup success rate is nothing to write home about. “There are times you want to call and the call is not just connecting, the call setup rate is poor, all is not well in terms of quality of service as the report suggests” he said. Based on the huge number of mobile subscriptions in the country, the minute percentage of errors allowed the operators to cover a large number of subscribers facing the quality of service challenge.
Cash shortages drops MTN’s fintechs’ revenue by 39.4%
The effects of cash shortages on over-the-counter (OTC) transactions during the first quarter of 2023 impacted negatively on MTN’s Nigeria revenue from fintech customers. The company, which disclosed this in its first half of 2023 financial results, said it reported a 39.4 percent decline in its fintech customers for the half-year 2023, bringing its users down to 7 million at the end of June. According to MTN, out of the 7 million fintech customers, 3.1 million are MoMo wallet users, representing 44 per cent of its total fintech customers. Despite the decline in customers, MTN said it recorded a 7.8 per cent growth in fintech revenue. Its fintech revenue for the first six months of this year stood at N43.6 billion compared with N40.4 billion recorded during the same period last year. The report also said that the naira devaluation impeded the company’s financial growth in the second quarter of 2023, recording a forex loss of N131.5 billion, an increase of N 117.9 billion from the N13.6 billion forex loss reported in the first of 2022. MTN reported that the Central Bank of Nigeria’s recent forex operations changes caused a significant 60 per cent movement in the exchange rate to N756.24/US$ by the end of June 2023. The telecom giant’s second-quarter results show pre-tax profits fell a whopping 64 per cent to N44.6 billion, taking off its half-year profits to N200.3 billion compared to N268.6 billion in the same period in 2022. Explaining the reasons for the company’s fintech business poor performance in the period under review, MTN’s Chief Executive Officer, Mr Karl Toriola, said the firm’s fintech user base was impacted by the effects of the cash shortages on over-the-counter (OTC) transactions during the first quarter of 2023. Toriola noted that the fintech business remains a crucial priority for MTN as it continues to put structures in place to support the execution of its growth strategy and scale the fintech ecosystem in line with our Ambition 2025 strategy. In that regard, he said the company would ramp up its fintech campaigns to create more awareness. Meanwhile, MTN recorded 49.9 per cent growth in its digital revenue for the period under review. According to the company, this was bolstered by revenue from rich media services and content VAS. Toriola said the digital revenue growth was also supported by the adoption of digital products and the development of the active base, up 56.6 per cent to 14 million. “In H1, we bought Amazon Prime Video and Apple Music to our customers, expanding our rich media services portfolio. Ayoba, our instant messaging platform, continued to gain traction with the addition of over two million users, bringing the monthly active users to 7.2 million in H1.
MTN mulls price increase over ‘elevated inflation’
Telecoms group, MTN, has disclosed that it is planning to increase prices in some African markets due to the elevated inflation in the operating environment. Nigerian Anchor reports that the telecom company operates across 19 countries, including South Africa, Nigeria and Ghana. MTN disclosed this in its first quarter report filed with the Johannesburg Stock Exchange on Thursday. “We anticipate that trading conditions across markets will remain challenging for the remainder of 2023 and we will continue to execute on our proactive measures to manage the near-term challenges and risks. “Within this environment of elevated inflation, implementing selective price increases across the portfolio remains a critical priority to ensure that operations generate sufficient cash flows to fund future capital expenditure needed for building world-class networks. “We will continue to have the necessary engagements with the regulatory authorities on such needed increases,” it said in its outlook for the rest of 2023. The telecom company said that the blended inflation across its footprint remained elevated and averaged 18.5 per cent in Q1 2023, compared to 11.5 per cent in Q1 2022. Interest rates increased during the period as central banks acted to curb inflation. Higher inflation and interest rates weighed on consumers’ spending power and impacted business activity, the company said. “MTN’s resilient business model and operational execution enabled us to continue to successfully navigate difficult macroeconomic, geopolitical and regulatory conditions in Q1 2023. “Local currencies generally weakened against the dollar, and foreign exchange availability was limited in several of our key markets affecting the pace of capital expenditure and our ability to upstream dividends and management fees. “Over and above reduced economic activity in South Africa, MTN South Africa’s (MTN SA) network availability remained under pressure due to ongoing power outages across the country: there were approximately 90 days of load shedding in Q1 2023 compared to 14 days in Q1 2022,” the MTN Chief Executive Officer, Ralph Mupita, said in the statement. The Group spoke on the Nigerian market. MTN Nigeria drove strong commercial momentum in a challenging operating environment to deliver a strong financial performance in the period. “In addition to higher inflation and interest rates as well as challenges with the availability of hard currency liquidity, the Nigerian economy was also impacted by the Central Bank of Nigeria’s redesign and introduction of new naira notes from 15 December 2022. The limited availability of new notes resulted in cash shortages, which impacted customers’ ability to recharge through physical channels and transact within the MoMo agent network,” it said. MTN Group disclosed that in line with its Ambition 2025 strategy, it continuously assesses investments, to improve returns and reduce risk. Thus, MTN Group is evaluating an orderly exit of three operations in West Africa over the medium term; namely MTN Guinea-Bissau, MTN Guinea-Conakry and MTN Liberia. The Group has received an offer for our equity interests in these Opcos, from Axian Telecom, which is being evaluated. The company is also in the process of exiting Afghanistan through the sale of MTN’s entire shareholding to a wholly-owned subsidiary of M1. According to the report, MTN revenue rose 15.6 per cent to 53.83 billion rand ($2.8 billion) in the first quarter of 2023 compared to 45.69 billion rand in the first quarter of 2022, the company said. Total subscribers increased by 5.2 per cent to 290.6 million, active data subscribers up by 11.9 per cent to 140.4 million, Data traffic increased by 19.3 per cent to 3221.26 PB and fintech transaction volumes increased by 38.8 per cent to 4.1 billion.