July 5, 2024/CSL Research
According to a report from the Nigerian Bureau of Statistics (NBS), the total number of active voice subscribers in Q1 2024 declined by 3.03% to 219,304,281 from 226,161,713 in Q4 2023.
On a quarter-on-quarter (q/q) basis, active voice subscribers fell by 2.41%. In contrast, the number of active internet subscribers increased to 164,368,292 in Q1 2023 from 157,551,104 in Q4 2023, representing a 4.33% rise. On a q/q basis, internet subscribers grew by 0.32%.
Lagos State had the highest number of active voice users in Q1 2024, with 25.96 million subscribers, while Bayelsa had the fewest, with 1.61 million voice users. Similarly, Lagos State also led in the number of internet users, with 18.84 million subscribers, whereas Bayelsa had the lowest number, with 1.20 million internet users.
A decline in the number of MTN voice subscribers dragged industry numbers. Though MTN maintained top position with the highest number of voice subscribers, its numbers declined by 10.65% y/y to 81.80 million. Airtel followed with the second highest number of voice subscribers, totaling 63.36 million, up 5.02% y/y, while Globacom had 62.19 million voice subscribers, up 2.29% y/y.
In terms of internet users, MTN again reported the highest number with 69.39 million, an increase of 3.98% y/y. Airtel followed with 46.82 million internet users, up 10.80% y/y, and Globacom had 44.38 million internet users, up 2.20% y/y during the same period.
The decline in MTN voice subscribers is attributed to the negative impact of the Nigerian Communications Commission’s (NCC) directive to disconnect subscribers whose SIM cards are not linked to their National Identification Numbers (NIN).
In addition to the NIN-SIM linkage issues, industry players are facing significant challenges, particularly regarding increasing operational costs. Factors such as foreign exchange devaluation and scarcity have severely impacted the profitability of major operators like MTN Nigeria and Airtel.
To mitigate these obstacles, telecom companies are advocating for tariffs that accurately reflect their costs. We argue that an upward tariff adjustment is necessary in the short term to safeguard profit margins and sustain sector growth. Despite these challenges, we maintain our view that advancements in new technologies, increasing smartphone adoption, and growing digital awareness will continue to drive the growth of active voice and internet subscribers across Nigeria in the long term.
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