Telecom customers in Nigeria spent a total of N731.94 billion on calls and data services provided by MTN and Airtel networks in the first quarter of 2023. This marked a significant increase of 15.42 percent compared to the N634.17 billion spent during the same period in 2022, as reported in the financial results of these telecommunication companies.
During the first quarter, MTN generated N505.45 billion from calls and data services, while Airtel earned N226.49 billion. The financial reports from both telcos highlighted a notable surge in the usage of data services, with data revenues nearly surpassing voice revenues.
Specifically, MTN obtained N277.61 billion from voice services and N227.84 billion from data services. On the other hand, Airtel recorded $262 million (equivalent to N120.61 billion) from voice services and $230 million (equivalent to N105.88 billion) from data services.
Karl Toriola, the CEO of MTN Nigeria, acknowledged the challenges faced by the company within its operating environment during the first quarter of 2023. He noted that the global macroeconomic and geopolitical developments had an impact on inflation, energy, and food, which was further aggravated by local issues such as petrol and cash shortages. These factors exerted additional pressure on consumers, businesses, and economic activity.
Toriola also pointed out that the private sector experienced a substantial contraction in March 2023, leading to a decline in the Purchasing Managers’ Index (PMI) from 44.7 points in February 2023 to 42.3 points. Despite these challenges, MTN’s data revenue increased by 40.0 percent, driven by the growth in active data users and higher data usage. The company attributed this success to its continued investment in network infrastructure to expand 4G and 5G coverage, improve network quality, and support the increasing data traffic.
Similarly, Olusegun Ogunsanya, the CEO of Airtel Africa, acknowledged the challenging operating environment in the past year. However, he emphasized that Airtel’s strategic focus on delivering reliable, affordable, and accessible services across its markets enabled the company to maintain its growth momentum.
Airtel also mentioned that it experienced a loss of $110 million in revenue due to the government’s directive to block customers who had not linked their SIM cards to their National Identification Numbers (NINs).
Regarding data revenue, Airtel reported a 27.8 percent increase in constant currency. This growth was driven by a 17.3 percent expansion in the data customer base and a 9.9 percent growth in data average revenue per user (ARPU). Over the past year, the company enhanced its 4G network infrastructure, achieving almost 100 percent coverage and increasing data capacity by 27.5 percent.
The World Bank identified the increased consumption of data services as a significant contributor to Nigeria’s information and communications technology sector. It is anticipated that data usage will continue to rise in Nigeria, primarily due to the increasing smartphone traffic. The Ericsson Mobility Report (June 2023) projects that data usage is expected to reach a minimum of 19GB per month by 2028.
