Telecommunication operators, especially Mobile Network Operators (MNOs) in Nigeria, earned about ₦2.78trillion last year from airtime sales and others.
Reports say that the 2019 earnings fell by about N370billion compared to the N3.15trillion the major operators including MTN, Globacom, Airtel, 9Mobile and the others earned in 2018.
It also showed that the slow economy, which has reduced subscribers’ disposable income, huge incursions by Over The Top (OTT) players, among others, contributed to the slide in operators earnings in 2019, as the Average Revenue Per User (ArPU) fell by 20 per cent from $4.87 (N1,490) to $3.85 (N1,182) going by the official exchange rate of N305 to N306 per dollar in the period under review.
President of the Association of Telecoms Companies of Nigeria (ATCON), Mr. Olusola Teniola, confirmed the decrease, saying that OTT activities ate deep into traditional telecoms operators’ resources in the country.
ArPU is used primarily by consumer communications, digital media and networking companies and is defined as the total revenue divided by the number of subscribers.
A market research firm, Ovum, had predicted that there would be a drop in spending on traditional communication services offered by the telcos by 36 per cent in the next 10 years.
It noted that services like messaging apps were built on innovative business models and offered a much lower price than traditional telcos were offering.
Statistics from the Nigerian Communications Commission (NCC) finished 2019 by adding 10.7million telephone lines to the network, which put the country’s active telephone users as at December 2019 at 184.7million.
The NCC statistics showed that in January 2019, MNOs earned an estimated N259.3billion from 174million active subscribers, while in February, the operators earned ₦258.7billion from 173.6million telephone users.
In March, with 173.7million customers, players including MTN, Globacom, Airtel, and 9Mobile made N258.85billion. For April, 173.6million active telephone subscribers expended N258.7billion on calls. In May, N258.7billion went to the operators from 173.6million persons, who made calls and sent text messages, among others.
The ArPU within the first five months of the year was $4.87 (₦1,490.22). But by ending of June, it fell to $3.85 (1,182).
As such by the end of June, with 174 million active customers, operators’ earnings had declined to an estimated N205.67billion. In July, from 174.9million active telephone users, telcos earned N206.7billion.
By August, the service providers banked N208.9billion from 176.8million customers. In September, from 179.2 million active customers, operators pocketed N211. 8billion.
In October, with 180million subscribers, telecoms operators earned N213.65billion. The November statistics showed that from 182.7million, they earned N215.95billion and N218.20billion from 184.6million customers in December.
Sales of airtime remain the core revenue earner for telcos and generate income for operators via voice calls, SMS, data subscriptions and value-added services.
- Media Report