Jennifer Ugwueke
The standing order by the Federal Government banning the sale of Subscriber Identification Module (SIM) cards is taking a huge toll on telecommunication operators as they may have lost over 15 million subscribers.
Since the suspension of new SIM card registration by network operators on December 9, 2021, many potential subscribers have not been able to get connected to any network.
This has reduced the expected growth of the subscriber base.
Findings by Daily Independent revealed that between December 2020 when the sale of new SIM cards was suspended and January, 2021, network operators lost over four million subscribers.
According to recently released industry statistics by Nigerian Communications Commission, there were 204,149,436 subscribers in December, 2020.
But by January 2021, the figure dropped to 199,863,827, indicating a loss of over four million subscribers.
If in one month there was a decline of over four million subscribers, it is estimated that about thirteen million subscribers would have been lost.
Similarly, all the four major mobile operators, MTN, Glo, Airtel, and 9mobile, also reported losses in internet subscribers in January.
This brings the total number of internet subscribers in the Country to 150.89 million after an all-time high of 154.4 million in November 2020.
In December 2020, there were 153,873,796 internet subscribers, but the number dropped to 150,898,122 in January, 2021.
Over the past three months, there has been a spike in phone thefts in the Country.
Most victims of this phone theft and other SIM card challenges have been having hectic time trying to retrieve their cards even though the Government has lifted the ban on SIM card replacement.
The negative impact of the temporary embargo on registration and activation of new SIM cards on Nigerians and, particularly, on service providers cannot be underestimated.
Investigations by Daily Independent showed that many subscribers have been dumping their alternative lines while focusing on how to get their primary lines registered and linked with the NIN.
The Minister of Communications and Digital Economy, Dr. Isa Pantami, directed the NCC to embark on another audit of the Subscriber Registration Database again in line with the Federal Government’s desire to consolidate the achievement of the SIM card registration exercise of September, 2019.
The objective of the audit exercise is to verify and ensure compliance by Mobile Network Operators (MNOs) with the set quality standards and requirements of SIM card registration as issued by the Federal Ministry of Communications and Digital Economy and the commission.
In the same vein, the financial fortune of the operators is fast dwindling as many subscribers are unavoidably being cut off from the telecom networks.
The SIM sale suspension is having financial implications on the network operators.
Using the industry Average Revenue Per User (ARPU) of N1,420 for 2020, as given by the Association of Telecommunications Companies of Nigeria (ATCON), the 15 million subscribers lost would have contributed a total of over N20 billion to telecom operators in three months.
ARPU is defined as the total revenue divided by the number of subscribers. It is a measure used primarily by consumer communications, digital media, and networking companies.
Since the beginning of the ban, the total calculated loss for the three months climbed to N21.3 billion.
The harsh economy in the Country has also forced some subscribers to dump their lines.
Besides, many people have been losing their phones to thieves and finding it difficult to retrieve their SIM cards.
These factors, among others, prevent the subscribers from recharging their lines which, by extension, denies the operators revenue.
Recently, Nigeria’s biggest telecom operator, MTN, generated N1.35 trillion in total service revenue for fiscal year FY 2020.
This is according to the group’s audited consolidated and separate financial statements for the year ended December 31, 2020.
Revenue grew 15.1% from N1.17 trillion in 2019 to reach N1.35 trillion in 2020.
Despite the global economic disruption caused by the COVID-19 outbreak, the telco recorded an increase in profits after tax of N2 billion year-on-year to N205.2 billion in FY 2020.