Telecoms stakeholders have cautioned that many Cell Digital Community Operators (MVNOs) in Nigeria may battle to outlive except they handle infrastructure gaps, goal area of interest markets, and adapt to native realities.
The warning got here in the course of the sixth version of the Telecoms Sector Sustainability Discussion board, organised by Enterprise Remarks in Lagos on Tuesday.
Contributors famous that whereas 43 MVNOs have secured licences from the Nigerian Communications Fee (NCC), just a few of them have absolutely launched providers.
Survival in danger
Chidi Ajuzie, Director of U.SK Cell, predicted that solely half of the licensed MVNOs might survive inside the subsequent 5 years. He harassed that licences alone will not be sufficient to ensure success, declaring that operators should put money into infrastructure, perceive market wants, and create tailor-made providers.
“Too many individuals suppose that when you get a licence, the cash will begin rolling in. With out infrastructure and innovation, many MVNOs will die out shortly,” he mentioned.
Ajuzie added that smaller gamers, particularly these in decrease tiers, will face vital monetary strain since they’re anticipated to construct a part of their very own infrastructure.
Nevertheless, he famous that this additionally creates room for progressive enterprise fashions.
Requires area of interest markets
Different stakeholders urged Nigerian MVNOs to keep away from competing straight with Cell Community Operators (MNOs) and as an alternative carve out area of interest markets.
They cited examples from South Africa and India, the place MVNOs thrived by specializing in segments like youth, migrant staff, and fintech providers.
- President of the Affiliation of Telecommunications Corporations of Nigeria (ATCON), Tony Emoekpere, mentioned the NCC launched a number of MVNO licence classes to liberalise the market and provides shoppers extra choices.
- He argued that MVNOs can solely stay sustainable in the event that they differentiate themselves in a market already dominated by MNOs providing web, enterprise providers, and fintech.
- He pointed to Kenya’s M-Pesa for example of telecom-enabled innovation that remodeled monetary entry for low-income and rural customers. He additionally highlighted alternatives in Nigeria’s rural communities, the place thousands and thousands lack dependable telecom and monetary providers.
“Designing a low-data bundle for POS machines in rural areas could possibly be a game-changer. These terminals don’t want broadband; a easy 2G community can deal with them,” he mentioned.
Native realities and coverage issues
A Director at IPNX, Olusola Teniola, warned towards replicating European or American MVNO fashions in Nigeria with out adapting them to native realities. He famous that affordability, rural connectivity, and infrastructure challenges have to be central to any technique.
“The most important market shouldn’t be the flashy smartphone customers in Lagos. The most important market is on the backside of the pyramid,” Teniola mentioned.
He additionally cautioned that over-reliance on foreign-owned operators may result in capital flight and weaken native innovation.
What you must know
Nairametrics earlier reported that 43 corporations had spent a complete of N8.6 billion to amass the MVNO licences even amidst concern that the operators might should battle to amass clients in a market already dominated by cellular community operators (MNOs) comprising MTN, Airtel, Globacom, and 9mobile.
The 43 MVNOs, based mostly on contractual agreements, will probably be leveraging the infrastructure of the MNO to supply telecom providers in unserved and underserved areas of the nation.
This, nevertheless, raises extra concern about capability because the MNOs are at the moment discovering it troublesome to speculate extra in infrastructure because of the present foreign exchange problem.
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