By Ilamosi Ekenimoh

In Data We Trust

In the 21st century, data is more than king. It’s more of a totalitarian dictator that controls every aspect of modern life; whether informational data or mobile data. And yet in Nigeria, it is devastating and not uncommon to find both sorely lacking. Informational data is being generated at a faster rate than it has ever been in the history of the world, with more than 90% of world data being created in the last 3 years alone.

As regards mobile data, a large percentage of informational data generated, is stored on the internet. Google records 3.5 billion search enquiries per day (that’s 70,000 per second), and according to International Data Corporation, worldwide data will quintuple from 33 zettabytes in 2018 to 175 zettabytes by 2025, all of which will be online. Business trends also point to increasing SaaS (Software As A Service) applications like Instagram, Netflix, Twitter, HBO, Uber, Bolt, Showtime, AppleTV, Apple Music, Tidal, Spotify, etc, braving the new frontier of e-commerce.

In a few years, both types of data will be indispensable, the mobile data more so, because it will be necessary to access the information essential to match the demands of a fast-paced, rapidly evolving world.

In light of all this development, Nigeria ranks 8th among the top 20 global internet users, with about 110 million internet users/ subscribers monthly, surpassing countries like Germany and the UK. The country also boasts one of the fastest growing telecoms industry in the world. According to the Director, Public Affairs of the Nigerian Communications Commission, Tony Ojobo, in 2018, more than 35 million people around the world connected to Nigerian businesses on Facebook.

Nigeria’s data revolution does not end there: its’ e-commerce market; valued at $13billion (N 4.01 trillion), is set to quadruple its value to $50 billion (N15.45 trillion) by 2028; Nigeria is the most mobilized county in the world, with 81% of its internet traffic coming from mobile devices. With about 6 million Twitter Users, 5.7 million Instagram users, 75% of which take action after looking at a sponsored post, and an increasing number of digital partnerships and digital engagement by local and international companies and brands, Nigeria’s’ online businesses market is set to break records in the next few years, further underscoring the importance of reliable data in the country.

Is Data in Nigeria Really That Expensive?

Nigeria’s’ Telecommunication (Telecomms) industry, is the largest in Africa, attracting more than 70 billion in investments yearly and contributing $21 billion to Nigeria’s GDP in 2018.

In 2017, an estimated 92 million Mobile subscribers, on average, spent N197 billion monthly, on internet data, which results in an average of N2, 141 being spent per individual, per month on data services. This price might seem inexpensive, especially compared to the prices of basic goods and amenities in the country currently.

However, when compared to the minimum income rate of N18, 000, it’s downright exorbitant.  According to Alliance for Affordable Internet (A4AI), affordable data means that the cost of 1GB must not be more than 2% of monthly income, and according to PwC, data prices in Nigeria have to drop by 97% to be affordable for its citizens. With Nigeria’s minimum wage, 1GB should cost no more than N360, thus the official average rate of 1GB for N1, 000 is over 50% higher than the A4AI standard. About 57% of the world’s population cannot afford more than 500 MB of mobile data a month now, and in order to do so, data costs have to fall globally by 70%.

There is a common fallacy, that Nigeria’s data is cheap. Data in Nigeria is not necessarily cheap, but it is Cheap-er.  In Nigeria, $3 fetches 1GB/1.5GB/1.6GB, which when compared to Egypt: $2/1.5GB, and Rwanda $2/2GB is abysmal. But Nigeria’s situation is better than South Africa: $8/1GB, and Kenya’s $81/GB. This cannot however be compared to India’s $0.26/1GB and Ukraine’s’ $0.51/1GB. While Nigeria’s data prices are comparatively lower than that of other countries, especially when matched with income as above, (and compared to the fact that minimum wage in the countries of comparison are higher) mobile data is not cheap.

Even for above-minimum wage earners, data prices are exorbitant because of the sheer amount of times they have to subscribe in a month. The Nigerian telecoms market suffers from the trifecta of lack of access to the internet, poor connectivity and cut-throat prices. Where the average Nigerian manages to surpass these challenges, it’s not uncommon to hear complaints of data plans and subscriptions running shorter than their intended lifespan, even with minimal use, and irrespective of negligible background data.

One user complained that his 12GB subscription which usually lasted a month finished within two weeks, though he fully made use of his office Wi-Fi services once he got to work, where he spends a large majority of his week, and occasionally, weekends. Users have similarly complained that though their data consumption habits have not changed, the amounts of times they subscribe in a month have increased. No investigation is being made into these complaints by the Nigerian Communications Commission (NCC).

This author advances the fuel attendant theory, which postulates that where a person, X, is in control of the supply of a commodity, without supervision or regulation, he may inflate the prices of goods, or exaggerate the quantum of services provided, while in reality not matching the figures represented on the metre, for personal gain. Many Nigerians speculate that this is the reason the short lifespans of their data subscriptions i.e. the price of data in Nigeria is high because data providers are not delivering on the promised quantity of data, and there is no regulation to ensure that they do.

When compared with other countries data rates, it is clear there is room for improvement in the prices of mobile data subscriptions in Nigeria. According to a report released by A4AI, only five African Countries have affordable internet; Mauritius, Morocco, Tunisia, Egypt and Sudan. Suffice to say, Nigeria is not on the list, though it was the first country to endorse the affordable internet initiative.

It should be noted, that contrary to its endorsement, the Nigerian government through the NCC sought to regulate the data wars (in which Nigerian telecoms providers were competitively reducing prices following an NCC directive removing the data floor price limit in 2016), by introducing a compulsory standardised rate of 90kobo/ 1MB, higher than the prices the Telecommunication Companies (Telcos) were charging for data services at the time, which for some service providers meant a 328% increase in tariffs. Though those efforts were stopped by the Nigerian Senate, data prices have only continued to climb since then. Combined with the fact that the average smartphone will consume more than 21 gigabyte of data per month by 2024, data could very well be classified as a luxury item at that future time.

It should be further noted that Speedtest Global Index ranks Nigeria as the 107th worldwide on mobile internet speed, with a download speed of 12.76 Mbps megabytes per second, against the global download speed of 25.38mbps. Which means Nigeria’s 100 million+ users all use internet services 50 % slower than the global standard.

So, Why is data so Expensive?

It is a usual first answer, and the general consensus of the public, that Nigeria’s telecommunications sector is not performing optimally due to a lack of competition in the sector. This is largely because, like many other African countries, Nigeria’s telcomms industry at its infancy, and for a large art of its adolescence, was solely run and regulated by its government. Analysts have attributed this monopoly as largely contributing to the current high costs of data in these countries.

Ntel, for instance launched operations within Nigeria in 2016 offering 23gigabytes of mobile data for N1000, and to be provided on LTE smartphones and Mi-Fi devices purchase from the company only. In 2018, Nigeria ranked 75th out of 77 counties in 4GLTE network. It is thus not surprising that in the same year which Ntel emerged as Telecom Company of the year, users complained that the company temporarily stopped the sale and distribution of SIM cards, and certain subscribers were unable to log in to their online platform to subscribe. Users also complained of slow services where there were previously no hiccups. The complaints as to a lack of network has trailed the company into 2019, in which it has reviewed its data tariffs to match market standards, offering 1GB for N1,000 valid for 30 days amongst others.

OpenSignal, a global network performance analyst, in their 2018 report; succinctly captures the situation; ‘…the networks have their faults. The biggest among them are inconsistency and congestion’. Globacom since it similarly embarked on its 4G LTE pursuit in 2016, has been subject of much criticism on social media, and customers have complained incessantly about the perpetually slow services and download times, and more recently, data fraud. The mobile network upon launching its 4G LTE plans promised data plans as low as 10 Giga Bytes for N2500 for 30 days, and 18 gigabytes for N4, 000 for 30 days, sometimes in addition to airtime and data bonuses up to 2.5GB in 2016. Customers however almost immediately noted the ‘excruciatingly slow’ services, and noted that the data could not be used, talk less of exhausted within the time frame. Customers have also complained about the companies’ indifference to complaints. It should be noted at this point, that the company has reportedly launched its 4G services about 3 times in the past 8 years.

Despite its allegedly slow services, The Globacom website still boasts its company, as the ‘grandmasters of data’ stating itself to possess the ‘most advance wireless technology offering Ultra Fast Internet speed’ (grammatical errors theirs), and according to a 2018 report by the NCC, Globacom outperformed other telecom operators and gained 2 million new subscribers in that year, making it the second largest telecoms operator in Nigeria. Other major players in the Nigerian Telecomms industry such as Airtel and 9mobile have been subject to similar complaints by users, but till date, little to nothing has been done about these reports. In the absence of regulation, chaos thrives. Regulators of the communications industry have either intentionally or negligently failed to cub the practices as highlighted above. It is thus possible, that one of the reasons data is so expensive could simply be because the regulatory authorities don’t care enough to properly regulate the prices and quality of mobile data subscription packages in Nigeria.


Activities of Over The Top (OTT) Operators such as Facebook, WhatsApp and other social media networks which provide for messaging and call facilities via the internet, might be another reason why mobile Data is so expensive in Nigeria. WhatsApp for example allows users the functionality of text, voice and video calls. Which means by subscribing to a data package, users need not buy airtime or ‘credit’ but may instead, call and text with their mobile data subscriptions. With a mobile data package of 1GB/month, for roughly 1,000 Naira, users can call, text, and perform other activities through various applications, giving them in essence, a wider range of service providers to choose from, whether Facebook, or Skype, or Email, or WhatsApp.

Mobile networks charge an average of N4/SMS and 11kobo/second for every phone call. Talktime per N100 is 14 minutes excluding messages and other special packages, so N1, 000 buys 140 minutes of airtime. A WhatsApp call consumes 300kb of data/minute on 3G networks, and 1MB/minute on 4G networks. 1GB=1 million KB. So at N1, 000/ 1 GB, on a 3G network a user gets over 3,000 minutes of airtime. For 4G networks, 1GB=1,000 MB. At N1, 000/ 1 GB, a user gets over 1,000 minutes of airtime; infinitely better than 140 minutes. It thus makes sense that higher data prices/ low quality of service= more airtime purchase.

The Chairman of ALTON (Association of Licensed Telecommunications Operators of Nigeria) Gbenga Adebayo commenting on the issue, complained that OTT operators are seriously eating into the voice and data revenue of Nigerian Telcos, as more and more users prefer to use these options for their calls and messaging, and, if not regulated by the NCC, will pose a serious danger to their operations, resulting in decline in the fortunes of the telecoms industry. In 2017 for example, airtime purchase dropped by 2.8% (it should be noted that 97.2% would still account for airtime purchases to renew data subscriptions) while companies like MTN recorded a 34.2% increase in revenue from data subscriptions. This drop in extra revenue serves as enough encouragement for Telcos to keep data prices high, or at the very least, keep quality low.

Ancillary to bad regulation, or a general lack thereof, yet another reason why mobile data is expensive could be dissuasion of new players in the Telecoms industry. The market theory of economics dictates that where different economic firms seek to obtain a share of a limited good, they vary different elements of the marketing mix; promotion, place, product and price. In summary, higher competition equals lower prices.

Circa August 2018, Google launched its Google Station Program, which aimed at providing free Wi-Fi internet services across Africa. With Nigeria as its first beneficiary, the company partnered with Nigerian based fiber network provider, 21st Century Technologies to provide ‘fast and secure’ Wi-Fi access to 200 locations in 5 cities at no cost to users (the service will be paid for via adverts targeted at the Wi-Fi users, though there linger concerns about misappropriation of users data). Users reported the data to be reasonably fast, even during peak periods thus creating effective competition with Nigeria’s data providers and their notoriously slow services and high prices.

In the University of Lagos where one of such stations were provided, students in the immediate vicinity drastically reduced the amount of times they renewed their monthly data subscriptions. One student stated that he had not subscribed in 3 months, and another stated it to be 10 times as fast as his usual service provider. That guesstimate is even smaller than the official estimate which estimates the data to be 80% faster than Nigerian broadband and telecommunications Internet, transferring data at 30 Megabits per second (Mb/ps) as opposed to the current 1.8Mb/ps transfer rates by the fastest local mobile services. It would thus not be a stretch to assume that should this service be allowed to persist, users would flock to locations simply to avoid paying for mobile data. Another basic economic theory is that demand necessitates supply. Therefore, if the demand for more of such stations increased, it would consequently increase its supply. The consequence of the increase in the supply of such stations is that demand for other more expensive products of the same/ lesser quality (current data packages) would reduce.

It came as no surprise therefore, that News reports have recently stated that the service, which was championed by the Vice-President of the Country, Prof. Yemi Osinbanjo, may be cancelled soon. This according to the NCC who noted that Google has failed to register with, and obtain a license from them, thus making their service illegal. The crackdown by the NCC is allegedly a bid to protect local content, though possibly detrimental to affordable data services for citizens in the future.

Operational costs may also be a huge factor in the rising data prices and tariffs. With the country entering a recession in 2016, from which it still hasn’t recovered, though the recession officially ended in 2018, the steeply increased prices of goods have not reduced, but have in fact, in some circumstances, have continued to go up unchecked. In 2016 the Guardian reported that telecoms tower maintenance costs increased to 104 million dollars per month. A tower operator in the report attributed it to in part, an increase in the cost of diesel, owing to non-constant power supply, and the prices of generators and generator parts being affected by foreign exchange rates. Security for the lives and equipment present at tower sites were also factors mentioned in the report. Gbenga Adebayo, the Chairman of ALTON further commented that approval costs, multiple regulations and taxation as well as payment of non-legalised levies and vandalism also played an important role in costs incurred by Telcos. With Nigeria’s ease of doing business dropping to 146 out of 190 countries in 2018, and its corruption perception index at 144 out of 180 countries, the situation does not appear to be improving anytime soon

The final, and perhaps the most important reason why mobile data is in Nigeria expensive in Nigeria, is that Nigerians are poor. There are 2 basic factors to be examined in determining whether data is affordable: How much it costs, and how much people make. As to the second factor, in 2018, Nigeria was ranked the poverty capital of the world with 87 million people living below $1.90/ day (N694.00). As earlier highlighted, the cost of data in Nigeria ideally ought to be 2% of monthly income, which with N18, 000 minimum wage, should be N360 per 1GB. This, however is not reflective of the current data prices in the country.


Cause and Effect

The most obvious and devastating effect of the high cost of is data exclusion and lack of access to the internet. Increasing data plans and tariffs mean that people will subscribe less to save cost, and in doing so, will be left with inadequate information in what is being termed the 4th industrial revolution. The consequent effect this would have, is to deny of the right to access internet services, which is largely becoming accepted as a n the 21st Century, to Nigerian citizens, and ancillary to that, their right to information.

With a growing number of start-ups’ and entrepreneurial activities, SMEs make up about 90% of African businesses, and in Nigeria account for 84% of total employment, numbering over 37 million across the country,  a growing number of which are tech driven. For non-tech SMEs, greater access to mobile data will undoubtedly improve the quality of their business, and/or expand them; whether through advertisement, sale or learning options. High data prices thus are in no way beneficial to these businesses, currently restrict the ease of doing business, generally in the country, and will continue to hinder the growth of these businesses, and by extension, the growth of the country’s economy.

Access to mobile data is capable of transforming many aspects of the Nigerian society. In addition to accelerated economic growth, and fortified individual rights, affordable internet access can expand educational capacity for Nigeria, by making education cheaper and more available for its 10.5 million out-of-school children. It could improve credit markets, boost investments, support urban planning and better quality of life. The effects of expensive mobile data are as endless as the possibilities that affordable data will create.

4Ging Ahead

Much chatter in recent years has focused on traditional telecoms providers, and their unstable role in providing adequate services in a constantly shifting market. The BICS report records 4G traffic tripling on a year-on-year basis, and a huge range of industries; automotive, retail, security, architecture and agriculture are adopting IoT (Internet of Things) strategies which will require 5G networks to support multiple uses.

While Nigeria still struggles with the functionality of its 4G network, (largely due to an enormous drop in the speed of 4G internet during the day while many users are actively connected and inconsistent services) There exists an expected roll out of 5G technology in just few years, with anticipated applications to technology such as Artificial intelligence, and Self-Driving Cars. If Nigeria, the Telcomms giant of Africa is left behind in this bold new step forward, there is no telling the perils the country with its estimated 190 million citizens, and the continent in which it resides, may face.

In order to move forward, Nigeria must first fix the aforementioned, inherent problems in its telecoms sector, to make access to the internet more affordable. As part of an A4AI event held in Lagos, Nigeria, in 2014, recommendations to increase data affordability and effectiveness include; the development of broadband plans and strategies with a focus on the special geography of Nigeria, greater infrastructure sharing, enhanced competition, effective taxation policies to reduce multiple taxation,  better market regulation and other necessary policy adaptations to increase the ease of business in the telecoms sector .  An increase in income via rapid economic growth would be a welcome development, enabling more people to afford data; as with every mass-consumed product improving incomes is one of two factors that move products over time, from luxury items to common goods.

In the poverty capital of the world, it is notoriously easy and extremely expensive to be data poor. And yet, data; informational and mobile, are necessary to change this status quo. Expensive data, therefore is a luxury that the country cannot afford.

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