Telecommunications companies in Nigeria are creating innovative business models that integrate third-party content providers into broadband service provisioning, with a view to quickly closing the mobile data revenue gap currently facing the industry, market observers have said.
According to them, Nigeria is witnessing a massive surge in mobile data traffic, driven specifically by the proliferation of tablets and smartphones, without a corresponding increase in revenues from data oriented services.
A recent report by StatCounter, an independent web analytics company, shows that Nigeria has the highest mobile traffic rate ahead of India and South Africa, as mobile devices remain the primary means of accessing the internet in the country. 77 percent of Nigeria’s internet traffic from its large user base is mobile.
According to the Nigerian Communications Commission (NCC), some 87 million Nigerians currently browse the internet on networks in the country.
The NCC’s monthly internet subscriber data for April, however, showed that there was an increase of 1,587,514 internet users on both the Global System for Mobile Communications (GSM) and the Code Division Multiple Access (CDMA) networks in April alone.
In the data, 85.4 million internet users were recorded on the networks as of March, and then this figure increased to 87 million internet subscribers in April.
Market observers are of the view that despite the growth in mobile data usage, revenue continues to lag.
For Etisalat Nigeria, United Arab Emirates (UAE)-based telco; revenue from data services is about 20 percent of overall revenues.
This leaves massive room for improvement, according to market watchers, considering the need to develop alternative sources of income to compensate the steep decline in revenue from voice oriented services.
To them, data revenues are close to 40 percent in some other emerging markets such South Africa and Brazil. “African telecom service providers are intensifying their efforts to develop their own application stores and generate local content services,” said Spiwe Chireka, programme manager for telecoms and media at International Data Corporation (IDC) Africa.
MTN, Nigeria’s largest operator by subscriber numbers, is building a robust distribution platform in order to enable the vast majority of Nigerians access locally-relevant mobile software applications at zero data cost.
“The game changer for us is how we can best organise all of these life-enriching applications and content service,” said Bayo Adekanmbi, chief marketing officer at MTN.
Speaking with BusinessDay in an interview, he said: “The reason for the partnership with the app development community is so that as we create these apps, we get them into the hands of as many Nigerians as possible.”
Industry observers told BusinessDay recently that telecoms operators were seeking fresh ways to liberalise Over-the-Top (OTT) content services such as Facebook, Twitter, WhatsApp, Skype, especially among underserved, rural communities.
According to them, telcos are integrating the OTT’s offering into their data packages and bundles, in a bid to generate an additional revenue streams, as the OTTs pay a fee to the operator for promoting and selling its service.
BEN UZOR
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
