The country’s telecoms industry, according to MTN Nigeria CEO, Karl Toriola, is in a “deep crisis,” and the industry is dealing with significant sustainability issues across the nation.
During the Financial Derivatives Company (FDC)-hosted telecom investment seminar in Lagos accessed by BrandSpur telecom and IT news, Toriola expressed his opinions.
He pointed out that unsustainable pricing and growing costs are currently posing a danger to the industry. Toriola emphasised that a price hike is now an “absolute necessity,” saying that it can no longer be avoided.
He claims that the industry is “in an intensive care unit” and that action must be taken to prevent an impending collapse.
According to him: “Nobody is going to put in $1 with the expected return of 60 cents on the dollar.”
Without appropriate improvements, Toriola said, the flow of fresh investment into the sector might completely dry up. He emphasised the importance of the sector’s revival.
Static pricing, he said, is no longer viable.
Speaking further, he revealed: “There’s no way under the surface of the earth, in the kind of inflationary environment and forex devaluation that we’ve seen, that an industry can maintain prices the same for 11 years.”
In his opinion, the cost of capital and the need for additional infrastructure, such as base stations and diesel generators, are some of the fundamental problems the industry is currently facing.
He states: “Without adjustments to pricing, the industry’s ability to function and attract investment is in jeopardy.”
Toriola stated that despite recent advancements in talks with regulatory bodies, there are still significant obstacles to overcome. According to him, stakeholders are starting to realise how serious the problem is and are thinking about making the required adjustments, such as raising prices or making concessions.
Adding, he said: “Qualitative action needs to be swift and decisive to prevent the collapse of the industry.”
