9mobile, Nigeria’s fourth largest telecommunication service provider, has seen a loss of more than 11 million internet subscribers in six years, data sourced from the Nigerian Communications Commission (NCC) shows.
According to the data, the total number of subscribers, which hit 17 million, an all-time high in April 2016, dropped to five million at the end of November 2021, representing a 11.4 million dip.
Since April 2016, the telco has only picked up a growth of 1.4 and 0.3 percent in September and October 2020 respectively, after it recorded a continuous loss for about four years and five months at an average rate of 56.6 percent. Meanwhile, in 2021, no single subscriber growth was recorded.
This could be owing to the company’s inability to fully recover from the divorce between the telecommunications regulator, Nigerian banks, and Abu Dhabi-based Etisalat Group, the parent company of Etisalat Nigeria.
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“Note that 9mobile had some issues years back when the original investors exited the company and both the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) had to intervene to keep the operation running,” Ike Nnamani, President, Association of Telecommunications Companies of Nigeria (ATCON) told BusinessDay.
While the company is still working through the process, the expectation is that it will be able to resolve its financial challenges soon and be able to expand its services offering.
“Until the financial challenges are fully resolved it won’t be able to expand and grow like other operators, who do not have the challenges 9Mobile is currently faced with,” Nnamani added.
Also, a grossly underperforming Nigerian economy and poor technology infrastructure development may have contributed significantly to 9Mobile’s current troubles. Prior to now, there have been speculations of the company being up for acquisition.
In November 2018, Teleology finally emerged as the new owner of the struggling brand, after it was put up for sale following a default on a $1.2 billion loan owed to a consortium of 13 banks. The company pulled out after only two months of acquisition.
According to reports, Teleology holdings pulled out because it has become “increasingly uncomfortable with actions taken outside of the agreed business plans” since its takeover.
Since then, the woes of 9mobile have only gotten from bad to worse. And with Teleology’s experience, that is probably one of the major reasons an acquisition would not be an option for 9Mobile, at least for now.
Despite the Approval in Principle the company received in August 2020 from the Central Bank of Nigeria on its Payment Service Bank (PSB) licence, it has not been able to use it to its advantage as experts speculated.
For an efficient mobile money service, 9Mobile would require investment in infrastructure to be able to go into some parts of the unbanked that are unserved or underserved. Also, scaling will help grow its customer base to justify its existence in the market.
However, for a company that is still struggling with financial challenges, the chances of riding on the license, infrastructural investment, as well as scaling are slim.
