NCC suspends directive on data segment price floor

The Nigerian Communications Commission after being asked by the Senate to stop its planned hike in data tariff, scheduled to commence on December 1, 2016, has suspended its directives on data segment price floor.

Tony Ojobo, Director, Public Affairs, NCC, in a statement said “the decision to suspend this directive was taken after due consultation with industry stakeholders and the general complaints by consumers across the country.”

“The Commission has weighed all of this and consequently asked all operators to maintain the status quo until the conclusion of study to determine retail prices for broadband and data services in Nigeria,” he said.

It can be recalled that on November, 2016, the Commission wrote to the Mobile Network Operators (MNOs) about the determination of an interim price floor for data services after the stakeholder’s consultative meeting of October 19, 2016.

According to NCC, the decision to have a price floor was primarily to promote a level playing field for all operators in the industry, encourage small operators and new entrants.

The price floor in 2014 was N3.11k/MB but was removed in 2015. The price floor that was supposed to flag off on December 1, 2016 was N0.90k/MB.

In taking that decision, the smaller operators were exempted from the new price regime, by virtue of their small market share. The decision on the price floor was taken in order to protect the consumers who are at the receiving end and save the smaller operators from predatory services that are likely to suffocate them and push them into extinction.

The regulator said the price floor is not necessarily an increase in price but a regulatory safeguard put in place by the commission to check anti-competitive practices by dominant operators.

“This statement clarifies the insinuation in some quarters that the regulator has fixed prices for data services. This is not true because the NCC does not fix prices but provides regulatory guidelines to protect the consumers deepen investments and safeguard the industry from imminent collapse,” the statement read.

Before the new suspended price floor of N0.90k/MB, the industry average for dominant operators including MTN Nigeria Communications Limited, EMTS Limited (Etisalat) and Airtel Nigeria Limited was N0.53k/MB.

Etisalat offered (N0.94k/MB), Airtel (N0.52k/MB), MTN (N0.45k/MB) and Globacom (N0.21k/MB).

The smaller operators/ new entrants charge the following: Smile Communications N0.84k/MB, Spectranet N0.58k/MB and NATCOMS (NTEL) N0.72k/MB.

“The NCC as a responsive agency of government takes into consideration the feelings of the consumers and so decided to suspend the new price floor,”  Ojobo said.

However, Adebayo Shittu, Minister of Communications says he knows nothing about the directives on data segment price plan.
“I want to say that I was not privy to it, I was not party to it, government never gave any such instruction and the government as the representative of the people would never have done that – that the voice of Nigerians must be muscled,” he said this morning on a radio interview.
Moni Udoh, Director, ICT, Federal Ministry of Communications, confirmed the surprise of the Ministry to Businessday in a telephone interview.

“We haven’t received any information or document for data increase from the NCC in this ministry, nothing has come to my table and like the Minister said this morning, we don’t know anything about it and so it has not been approved by the Ministry of Communications.

 

Jumoke Akiyode