Nigeria’s ISPs shrink to 242 as struggling operators fail to resume licence 


The variety of lively Web Service Suppliers (ISPs) in Nigeria declined to 242 in July from 252 in Might this yr as operators whose licences expired didn’t renew them. 

In response to the July up to date database of the ISPs revealed by the Nigerian Communication (NCC), the decline in quantity got here whilst two new companies; Sulfman Consulting Ltd. and NGCOM Lastmile Answer Ltd. have been issued an ISP licence on July 1. 

This means that 12 ISPs relinquished their licences in June this yr. The five-year tenured licence prices N500,000 and it’s renewable.  

Nonetheless, the NCC had just lately lamented that lots of the ISPs weren’t renewing their licence, resulting in a steady decline within the variety of lively operators in that telecom market section.  

Militating elements 

The speedy previous Govt Vice Chairman of the NCC, Prof Umar Danbatta, just lately famous {that a} whole of 568 licensed ISPs had turn out to be inactive as of March 2022, citing anti-competition practices within the trade as a significant problem.  

The previous NCC boss added that different points confronting the web suppliers embody insufficient spectrum, excessive value of bandwidth, excessive price of Proper of Approach, and lack of excellent company governance apply within the corporations. 

Though ISPs in Nigeria have at all times complained concerning the unhealthy competitors between them and the cell operators, who’re thought-about the large gamers, trade analysts stated the scenario acquired worse with the launch of 5G by MTN and Airtel, which has seen some enterprise clients of the ISPs dump their service suppliers for 5G routers. 

MNOs dominating web service provisioning 

Whereas the cell operators comprising MTN, Airtel, Globacom, and 9mobile is also considered ISPs as a result of they supply web service alongside voice and different providers permitted by their Unified Entry Service Licence (UASL), the core ISPs are licensed to offer solely web service and are principally indigenous corporations. 

Nonetheless, the MNOs have remained the dominant gamers within the web market. ISP buyer information just lately launched by the NCC exhibits that the main ISPs with a major variety of clients, 106 of them, had had a cumulative 262,206 lively clients as of Q1 2024.  

In the identical interval, the 4 MNOs, MTN, Airtel, Globacom, and 9mobile had 163.8 million lively web subscriptions.  

Name for presidency’s intervention  

Whereas emphasizing the position of the ISPs within the nation’s quest for ubiquitous broadband, the Chief Govt Officer of VDT Communications Restricted, one of many main ISPs, Mr. David Omoniyi, appealed to the federal government to return to assistance from ISPs within the nation.

In response to him, the ISPs that could possibly be categorised as Small and Medium Enterprises (SMEs) within the telecoms market are dying by the day.  

Omoniyi added that the implementation of the Nationwide Broadband Plan 2020-2025 requires the enter of each stakeholder to succeed, therefore the ISPs, which play vital roles in taking the providers to the final mile have to be supported.  

“We have to carry everyone alongside and a technique is to maintain the ISPs alive. We want nearly all of them round to maintain using individuals and to take the service nearer to the individuals. There’s a want for focused intervention for them to outlive,” he stated. 

In response to Omoniyi, the telecom trade regulator would want to grasp the mitigating elements to deal with the issues of the ISPs. 

“What’s obstructing the expansion of those ISPs? Is it funding? The working atmosphere? Is it regulation itself? Whether it is regulation, that’s inside the ambit of the regulator. The regulation in all probability favours the larger ones. What I imply is that the regulation must be focused at selling the ISPs, the smaller ones. 

“The smaller gamers play in the identical market. They promote to the identical subscribers. In any other case, the tendency is for the larger gamers to be monopolies. When you’re an enormous fish, you’d need to be the one fish within the pond.  

“In fact, if you end up the one fish within the pond you’d turn out to be a goal for an additional larger predator. The regulator must play the position of an umpire and frown at any anti-competitive apply from the larger gamers,” he stated.  

In the meantime, the NCC in a latest examine by the Rising Applied sciences Analysis Unit of its Analysis and Growth Division acknowledged that licence renewal fee of ISPs in Nigeria continues to drop, whilst new companies take up the licence. 

The researchers, due to this fact, known as for a regulated improve within the costs of information to avoid wasting the ISPs from dying. In response to the examine, there may be at the moment a regime of “artificially low information costs” available in the market attributable to stiff competitors among the many operators. 

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