Apart from commercial banks, which have been running away with astronomical profits, the years 2023 and 2024 have been tumultuous years for businesses in Nigeria, leading some to move from the country. The reasons are not far-fetched. They include the devaluation of the Naira, due to the floating of the exchange rate; repeated hikes in the prices of petroleum products because of the removal of fuel subsidy; and high inflation, resulting from the above developments.
It is understandable, therefore, why the trio of telephone service providers in Nigeria, MTN, Airtel, and Glo, have been suffering major losses in revenue since 2023. Their operation is further complicated by the introduction of value-added tax on tower leases in the 2023 Finance Act and repeated power grid failures, leading to power failure in many parts of the country. Nevertheless, despite these harsh conditions these telephone service providers have continued to make some profit.
Unfortunately, consumers bear the brunt of their losses, which are passed to them in the form of poor services. Telephone calls don’t go through. Messages hang or are not delivered. Images fail to load. Yet, even for such unsuccessful deliveries, you may lose credit or data. The result is the frequency of usages, such as ‘poor’ or ‘no network’; ‘network problem;’ and ‘network failure’ among others. No promotional giveaways, such as ‘20% more data’ or ‘100% awoof credit or data’ could compensate for these inadequacies.
Yet another reason for these problems is oversubscription by the service providers. For example, as many as 1000 users may be subscribed to a service node meant for 500 users. There is also the problem of poor equipment maintenance. For example, someone living near a mast told me that no one had come there to inspect it for over three years! Again, consumers suffer the consequences of such neglect.
These inadequacies are particularly felt in online banking. Bank Apps crash or do not work due to network failure. Of course, commercial banks create other problems for their customers. For example, it sometimes takes hours, even days, for transferred funds to show up in the beneficiary’s account, despite instant debit of the payer’s account. Sometimes, the funds don’t even show up at all and repeated calls to the bank may yield no result until you go to a branch yourself. Worse still, ATM machines are often terribly slow, because most of them are outdated. Besides, only 10 Naira maximum is dispensed in most cases. Moreover, you often pay charges for the number of withdrawals you make.
The problem with network failure in Nigeria is part of a huge structural problem. The telephone service providers seem to be piggybacking on the failure of supervision by appropriate government agencies. It is also possible that, where supervision does take place, sanctions are compromised by corruption. Not a few think that the Bobrisky case and its investigations are similarly compromised.
Yet, there are many questions waiting to be answered by the service providers and the supervising agencies of the government. For example, given the existing capacity of installed equipment, how many subscribers could each provider effectively carry without overload? How extensive is each provider’s 4G coverage? This is an important question because data download often slows down or fails completely whenever coverage drops to 3G or below on any service provider’s network.
The truth is that we may not be able to take part effectively in the digital revolution if telephone service providers continue to perform below average. Yet our participation is critical not just for individual telephone services but also for the benefit of our institutions, especially educational and health institutions. Network connectivity is critical to digital success in these institutions. For example, college students and medical doctors learn a lot these days from online resources.
The above observations have serious implications for the economy. So does frequent power failure. According to available data, there are about 27 grid-connected generating plants currently in operation in the Nigerian Electricity Supply Industry (NESI) with a total installed power generation capacity of about 13,000-15,000 MW and an available capacity of just over 5,000 MW. This is a far cry from the estimated 35,000 MW needed for a population of 250 million people.
By contrast, Brazil, with comparable population, climate, and structure of government, has an installed power generation capacity of 150,000 MW and available capacity of at least 130,000 MW! Yet the government plans to add 6000 MW of capacity every year to satisfy growing demand from an increasing and more prosperous population. That is why the government aims at investing over $100 billion over the next five years on power generation, transmission, and distribution. What is even more interesting about Brazil’s energy structure is its diversification. While Nigeria relies on natural gas and hydropower, Brazil derives its energy from a variety of sources—fossil (oil, coal, and natural gas); and renewable (hydropower, wind, and solar). Brazil did not arrive at this level in one day. It is all a result of careful planning and effective implementation from government to government.
That is why the combination of power and network failures needs urgent attention from the government.
