MTN Nigeria, the largest network operator by subscriber number said it has since redirected its focus on capital expenditure (CAPEX), to investing more on data facilities rather than voice.
The telecom company said it took the decision because it observed that Nigerian subscribers are fast shifting from voice communication to data communication.
The telecoms company made the disclosure in Lagos shortly after it signed the documents through which it secured a N200 billion loan facility from 12 banks for network expansion, part of which it said, would be spent on.
The General Manager, Corporate Treasury Finances at MTN, Mr. Ishmael Nwokocha, who made the disclosure, revealed that out of the N180 billion the company earmarked for CAPEX this year, large chunk of the money was spent on network expansion, upgrade and optimisation for data, in order to meet the growing demand of its customers for data services.
According to him, MTN had a legacy network that was built to provide voice services but decided to redirect its focus from voice to data and invest heavily in data service offering because of the shift from voice to data, which has become a global phenomenon.
“In 2016 we spent N192 billion on CAPEX, in 2017 we spent N225 billion on CAPEX and in 2018, we earmarked N180 billion on CAPEX, and a large chunk of the 2018 budget was directed to network expansion, upgrade and optimisation to meet the growing demand of our subscribers for data services,” Nwokocha said.
“We are currently experiencing more demand for data services from social media like WhatsApp. As we transit from call-centric to data-centric, we need to improve our infrastructure for data service offering, and we have to prepare for the future, if a large part of our revenue will be coming from data, hence our new focus and energy are on data and how to invest more in our data facilities,” Nwokocha added.
Addressing the status of MTN Nigeria in rolling out its Long Term Evolution (LTE) technology, Nwokocha said, “MTN is not in the process of acquiring LTE technology for its broadband internet penetration, because we have already invested in LTE and we have the technology running.
“For every telecom company, the foundation is always about the frequency, because the more frequency they have the better services they can offer, and this is what we had long invested in, to further boost coverage in underserved and unserved communities of Nigeria. If we have sufficient frequency, our data coverage will be much better.
“We already have LTE services, what we are doing is expanding our LTE services in Lagos, Abuja, Port Harcourt, and we are currently in nine cities, even though we have cities that are still not on 4G.
“This is part of the reasons why we are interested as the biggest telecoms operator in the county, to expand our capital expenditure to cover full data service offerings.”
“In the last two years, our focus as a telecoms company had been on increasing customers’ experience through our network expansion and we will continue to invest until that is achieved,” he said.
Responding to questions on the general rollout of 5G technology, Nwokocha said there was need for operators to exhaust 3G and 4G network rollout before embarking on 5G network rollout.
According to him, 3G and 4G smartphone penetration has remained low.
“We can talk of 3G and 4G smartphones and network rollout in in cities like Lagos and Abuja where we have better penetration, but this is not so in the rest of Nigeria,” he added.
“MTN has tested 5G rollout in South Africa, we are going to conduct a test in Nigeria also, but for us to push up this, we have to make sure that the 5G compliant smartphones are in the market and that the smartphones are in the right preference,” Nwokocha said.