Competition as Catalyst to Lower Data Cost


Competition in data service offerings among telecoms operators is the driving force behind the crashing cost of data bundles to the benefit of subscribers, writes Emma Okonji

When Global System for Mobile Communications (GSM) services were launched in Nigeria in 2001, the voice service offering was predominant among offered by the telecoms operators. At that time, cost of voice calls was N50 per minute and most of the few subscribers with mobile devices could not make calls at ease from their mobile devices because of the high cost of voice calls. The period was characterised by the services offered by call centre operators, who positioned themselves at strategic spots along the roadsides under branded umbrellas of telecoms operators. Customers who patronised them to make calls, did so in a hurry, just to avoid incurring huge cost from the N50 per minute billing.

But in 2003, the scenario changed when Globacom entered the telecoms space with per second billing. Globacom started billing customers as low as 20 kobo per second, which approximately was N12 per minute, and this brought a lot of relief to customers. The beauty of per second billing was that it removed the idea of rounding off all calls that ended in seconds into minutes. Before Globacom introduced per second billing, calls that ended in 2 minutes and 2 seconds, were automatically rounded off to 3 minutes and subscribers were charged N150.

With the per second billing, Globacom, however, forced other operators to start billing their customers in per second. This continued until about 2008, when telecoms operators started offering core data services on their networks, which was a deviation from their core voice offerings. However, in 2010, a global shift from voice to data services, compelled telecoms operators to increase competition for data service offerings. Since then cost of data service offerings has continued to drop, while the data bundle capacity continues to increase, a situation that has become a delight for telecoms subscribers.

Data service and competition
In 2003, Globacom came into the market with the mantra of innovation. It positioned itself as the most innovative telecoms company in the market. The company had enough grounds to lay claim to that position as it came into the market with a 2.5G, GPRS network, different from the 2G infrastructure that other operators were riding on.
With this, Globacom could provide value added services like M-banking, text2email, Magic Plus, Multimedia Messaging Service, vehicle tracking among other revolutionary services.

The emergence of Globacom added fun to subscribers’ daily network experience. For instance, the launch of the Blackberry in 2006 was a game-changing move that gave the network an edge. The network continued to blaze the trail and went on to launch the 3G network.

The era of 3G communication saw the explosion of data-based telecommunication and mobile internet services. Nigeria had entered the league of online nations where business and social communication were done virtually on-the-go.

But one barrier existed between the subscribers and the service providers, which was cost. While the bandwidth was available, customers often could not afford the cost of many services over the World Wide Web that connects the world via internet. Audio streaming, not to mention video streaming or heavy data usage for most internet data users was out of the question. Not many data customers could afford to buy up to 1 Gigabyte of data bundle. Many depended on small plans that gave 100 or 200 megabytes and at most 500 megabytes.

Globacom data offerings
In the midst of offering competitive data services, Globacom stepped in with Glo-1 in 2010. The infrastructure addressed the inadequacy of SAT-3 that could not guarantee the required speed and capacity for the emerging bandwidth demands of Africa. The landing of Glo1 translated into much faster and more robust connectivity for voice, data and video. This development and the launch of other submarine cables like Main One, made bandwidth available and facilitated a drastic fall in the cost of doing data/internet services.
Globacom led the way to liberalise access to data, thereby making internet connectivity not only fast and available, but also making such services pocket-friendly.

In January 2016, Globacom gave subscribers the bumper data offer, which increased the value of its data. It gave subscribers 6GB data for the N3,000 data plan instead of 4.5GB, while a N4000 data plan was introduced with 9GB of data.
In May 2016, the telco came out with a-two pronged offer that gave free voice airtime to data subscribers. One of the products, Talk Special, gives free data to voice subscribers while Twin Bash gives free talk time to data subscribers.

In the new plan, subscribers to the network now receive up to double the data volume previously available on every plan.
An examination of the new tariff regime shows that the N1,000 plan which used to give the subscriber 1.5GB of data now gives 2GB, while the N2,000 plan which hitherto came with 3GB of data now has 6GB data.
Similarly, subscribers will now get 10GB of data for N2,500 plan instead of 5GB and 12GB for N3,000 instead of 6GB data which the plan offered before.
For the N4,000 data plan, the subscriber will now get 18GB instead of the old 9GB, while the N5,000 subscription will give the customer 24GB.

The biggest offer is the N8, 000 subscription which, instead of the old 24GB, now gives the customer a 48GB of data. According to market analysts, Glo’s Data Overload is currently the most attractive offer in the market as no operator offers anything near it.
The Overload regime can be a game-changer in the industry and as soon as Globacom announced its new data plan, other GSM networks also recalibrated their rates.

Etisalat data services
One of the outstanding data services being offered by Etisalat is the Easy Flex Evolution.
It is another prepaid package from Etisalat that strives to take care of the customer’s voice and data needs upon successful subscription to any of the bundles. Just like Glo’s talk Special and Twin bash, the package comes with voice centric and data centric variants.
Apart from the Easy Flex Evolution, Etisalat reviewed its data packages to offer the following 1.5GB for N1,000, 3.5GB for N2,000, 6.5GB for 3,500, 16GB for N8,000 and 22GB for N10,000.

MTN data services

MTN is another operator that is offering competitive data services in the telecoms space. The telecoms company offers 1.5GB for N1,000; 3.5GB for N2,000, and offers 5GB for N2,500 on the MTN network. It also offers 10GB for N5,000, but its data offering rate is not the best among telecoms operators data offerings.

Airtel data offerings

Airtel, one of the earliest telecoms operators in Nigeria, offers the Airtel Unliminet, as one of its best data service offerings.
Just like Globacom’s Talk More and Twin Bash, the Airtel Unliminet gives free talk time for data ranging from 20 minutes to 300 minutes, depending on the plan. A N1,200 plan gives 1024MB with 60 minutes free talk time and 60 SMS; a 1.2GB on the Unlimitnet plan goes for N3,000 plus 180 minutes free talk time and 300 SMS; while 2.5GB of data is what the subscriber gets for N5,000 plus 300 talk time and 500 SMS.

On the regular plan for android phones, Airtel subscribers get 3.5GB data bundle for N2,000. Again, this seems not to be the best offer among telecoms operators.
On the Airtel network, the subscriber under the latest price scheme gets 5GB for N2500, while the benefit for N5,000 on the network is 24GB.
Airtel has a plan for N3,500 and this offers 7GB of data, while the company offers its 50GB bundle for N36,000.
For N8,000, Airtel gives 24GB of data for use by subscribers and for N10,000, it gives 34GB and for N15,000, it offers 30GB.

Comparison of data plan

A comparison of the various rates of data offerings among telecoms operators, shows that Globacom’s rates are far more competitive than the rates offered by other operators. For example, while Etisalat offers 22GB for N10,000, Globacom offers 48GB for N8,000. This is more than double the value Etisalat offers. For N2,000, Etisalat offers 3.5GB while Glo gives 6GB for the same amount. The differences run across board along the different data values.
On the Airtel network, the subscriber under the latest price scheme gets 5GB for N2,500, but on the Glo network, the benefit for N2,500 is 10 GB while the benefit for N5,000 on the network is 24GB.

Airtel has a plan for N3,500 and this offers 7GB of data, but Globacom offers 12GB data bundle plan for N3,000.
Again, Airtel offers its 50GB bundle for N36,000 while Globacom offers its 48GB of data for N8,000.

Industry watchers said Globacom’s competitive edge in data offering could be attributed to the reason why the Nigerian Communications Commission (NCC) has consistently rated the telco higher in terms of data offering.
A statement from Globacom explained that the new Data Overload had given Globacom a market edge above its competitors. The Data Overload was designed to promote upward migration from lower plans and excite Nigerians.
With the new Data Overload, Globacom has made big data available to all. The company said not only has it opened its doors to mobile internet, it is equally committed to speed and quality of service.

“Our Glo1 infrastructure and network of fibre optic cable around the country coupled with a renewed network of microwave facilities to provide last-mile delivery of bandwidth, make the Glo data network the most reliable in the Nigerian market,” Globacom said in a statement.