• Monday, March 04, 2024
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BusinessDay

NCC – Regulating in whose interest?

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What exactly is happening in the Nigerian telecoms industry? Whose interests are the operators serving? And, more importantly, in whose interest is the Nigeria Communications Commission regulating the industry? These questions have been nagging at one’s mind for a while. Things, however, came to a head when not long ago news filtered in that the NCC was attempting to stop an operator from offering lower tariff rates to its customers. Technical-sounding reasons were given for the ban, but it is clear that there is more than meets the eye.

If you are a subscriber to any of the “Big Four” networks in Nigeria – and who isn’t? – then you must have noticed how aggressively competitive the operators are. The industry is acclaimed to be one of the most competitive in the world, for good reason. As we all know, the good thing about competition is that consumers are ultimately the highest beneficiaries. Who can so soon forget that per-second billing was introduced into the Nigerian market as a result of competition, not regulation? Or that of all the goods and services produced in Nigeria, only telecoms services have recorded significant price drops – from about N50 per minute in 2002 to less than N7 per minute currently. Also, it was competition, not regulation, that drove the price of SIM cards from about N20,000 (yes, N20,000!) in circa 2002 to less than N100 in 2015. If telecoms networks have grown to provide coverage all over the nooks and crannies of Nigeria and literally democratized “talking”, it is because of competition, not regulation. The value added services, the houses, cars, millions of naira and other gifts showered on consumers to keep us talking on their networks have been the results of competition, not regulation. Indeed, if the industry is today one of the brightest spots in Nigeria’s corporate future, it is because of competition, more than anything else.

It is for this reason that we as consumers must be apprehensive when we notice that competition in the telecoms industry is being jeopardized. We should be even more concerned because there are indications that the industry regulator may have been captured by interests other than that of the consumer, and that it is protecting these interests above that of consumers in very blatant ways.

Flashback to 2013 when  the NCC declared two of the operators as dominant operators and ordered them to make certain changes in order to prevent them from abusing their so-called dominant status. As a result of that declaration, the biggest operator (MTN) which then had  about 50 million customers on its network was asked to charge the same tariff rate for its on-net and off-net calls. Now, the reason given by NCC was that they needed to make the market more competitive. But the impact of that decision was that MTN was forced to charge its customers higher tariff rates than what was charged by its competitors. So whose interest did NCC protect by that decision? Was it the interest of the over 50 million Nigerians on MTN who had to either pay more to MTN (as if MTN wasn’t making enough from them already!) or were forced to buy SIMS on other networks – and new handsets to go with it, just to enjoy the lower tariff rates that the other networks were charging. For some reason, neither MTN nor consumer protection advocates did anything about the folly in this decision.

Recently, we again heard that NCC had directed MTN to withdraw a tariff rate plan that it allegedly launched without NCC approval. We will not hold brief for MTN here – their publicists are paid well enough to do that! Apparently, NCC’s letter was leaked to the press, and it went viral. This is a shame in itself. Why any self-respecting regulator would leak official communication in the media is beyond us, but again, the NCC as one of Nigeria’s most well-heeled regulators can speak for itself. What concerns us is that the tariff rate that NCC asked MTN to withdraw is probably the lowest tariff rate MTN has ever charged its customers. This is in the interest of consumers. We all know how stingy the folks at MTN are, so why should the NCC ask MTN to withdraw this rare gift to its consumers when NCC should be the one asking operators to charge less? What is even more troubling is the fact that the tariff rate of N6.60 which NCC is trying to deny MTN’s over 60 million consumers is freely available to subscribers on other networks!

So we ask, whose interest is NCC protecting, and on whose behalf is it regulating? Given the curious speed by which the news back then hit the airwaves (it was reliably gathered that it even trended on twitter – pushed by professional publicists and “twitter marketers”) it is almost certain that it was one of MTN’s competitors that tried to force a reversal of this low tariff rate. There are still indications that the competitor is still up in arms using proxy, but it would be a sad day indeed if a government institution funded by taxpayers is now turned into a willing tool to force anti-competitive actions against the interests of the largest block of consumers in the market.

No doubt, the Nigerian telecommunications industry has witnessed remarkable growth over the years. Understandably, pundits are quick to credit the NCC for this success. However, the NCC’s recent actions are beginning to call into serious question its capability to protect the interests of consumers. Regardless of whatever technical issues there may be between MTN and the NCC, it is unfair to deprive its over 60 million consumers of the benefits of lower tariff rates which MTN is uncharacteristically providing to us. Competition is at play here, and we must all insist that the NCC should stand firmly behind consumers, regardless of whose ox is gored. NCC should protect consumers, not MTN’s competitors. Daily, we see how cabals and cartels in the petroleum, gas, power, mining, and other sectors in cahoots with their so-called industry regulators are stoutly resisting moves to liberalise their sectors. Nigerians suffer for this in higher prices, poor service, and low taxes to government. The telecoms industry has reversed this trend, and all concerned must call the NCC to order, as it does not appear to be acting in the interest of consumers that it is sworn to protect. The regulator should protect consumers, not competitors. It should let the consumers enjoy low tariff rates. Period.

Ada Ezedi