The Huge Data Rip-off in Nigeria

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Since the incursion into core data communication from the general voice communication by mobile network operators (MNOs), subscribers have raised concerns over data rip-off by internet service providers, writes Emma Okonji

Following a global consumer shift from voice communication to data communication, coupled with the emergence of Over the Top Technology (OTT), players currently provide free data services to subscribers  on WhatsApp and Twitter platforms, while riding on the network of MNOs that spent fortunes to build their networks. The MNOs in recent times, have, however, decided to shift from their core voice communication service offering to data communication service offering, in order to align with the global consumer shift.

Aside selling data bandwidth in large capacities to internet service providers (ISPs), which were originally licensed to provide data services to telecoms subscribers, the MNOs are also competing with the ISPs, by selling data bundles and offering data services directly to telecoms subscribers.

Although the incursion into data communication by MNOs is a global phenomenon meant to generate additional revenue strings for MNOs in order to make up for the loss in voice revenue, occasioned by activities of OTT players, the MNOs like MTN, Globacom, Airtel, 9mobile and ntel, are however using the opportunity to rip off telecoms subscribers of their money, through early data depletion. The situation is such that subscribers’ data bundle purchased from MNOs, depletes in a twinkle of an eye after few usage, which the telecoms subscribers have described as huge rip-off in the system that needs to be addressed urgently by the telecoms regulatory body, the Nigerian Communications Commission (NCC).

Subscribers’ Complaints 

Telecoms subscribers across networks have continued to groan under heavy data rip-off by data service providers, especially the MNOs. Majority of the complaints have been on fast depletion of data bundle after each successful purchase of data bundle from their data service providers. One of the subscribers who identified himself as Mr. Yemi Adeniran, said he has multiple SIMs for data services, and that the rate at which the data depletes from his devices after visiting few websites was alarming. According to him, as soon as data is loaded into my device and I visit few websites, the data bundle depletes faster than expected, forcing me to buy another data when I have need to go online another day.

Other complaints from subscribers, include fast data depletion while on social media. One of them said his monthly data bundle of 1.5 Gigabyte for N1,000, which is supposed to last for a period of one month, does not stay up to two weeks before he gets a notification   that he has consumed up to 75 per cent of his data usage and that within few days he is cut off because of insufficient data. Some other complaints have to do with the inability of telecoms subscribers to access the internet when they actually have sufficient data bundle to do so, which they attributed to poor network service on data delivery, and the inability to rollover their unused data to the next month. Most light users of data often have surplus of data at the end of the month, but cannot rollover the excess data to the next month. They had to forfeit their unused data of the previous month, at the beginning of a new month, a situation they also described as data rip-off.

Some other customers blamed the situation on weak internet infrastructure across the country. According to them, they got disconnected intermittently from the internet, especially at a time when they required the service the most, a situation, which is said to be hurting businesses that relied heavily on internet.

Some of the customers said they pay so much for monthly subscription, yet they do not get the full value for their monthly subscription. They have therefore called on the telecoms industry regulator, the Nigerian Communications Commission (NCC) to come to their rescue, and to compel ISPs to compensate for any downtime suffered by their customers and to ensure that service providers deliver unhindered internet access to customers.

MNOs Position 

MTN Nigeria Communications Plc, one of the MNOs, said in a statement that the company has provision for data rollover as palliative to enable MTN customers have more access to the internet, through subscribers’ data bundle. According to the statement, to roll over unused data balance, customers must renew their bundle before expiration or before the end of grace period.

Auto renewal only applies, if the customer selects the “Recurrent” option at the point of activation of any data bundle, the statement added. Like every other network/internet service provider in Nigeria, MNOs sporadically alter their data plan packages to suit their business. As a result, it can be quite difficult to tell which operator data plan/code is correct per time.

MTN Data Plans for instance, include daily, weekly, monthly as well as quarterly plans for phones devices, tablets and modems.

MTN once had the most expensive data plan for mobile devices, however with competitors like Glo and Airtel ever on the outlook to win over the hearts of more and more customers with mouth-watering deals, MTN said it has been forced to make her prices more affordable.

MTN used to have over 15 different data plans for Android/mobile users, but in recent times, that number has been cut to about nine plans, making the choosing process less ambiguous for the user, the statement added. It however explained that MTN has developed a single data plan that suits all mobile devices.

Globacom, in a statement, said its data plans are by far the cheapest than what any subscriber can get in Nigeria.

Whether you are a heavy data user or a light user, you will find your perfect choice from Glo’s list of data bundles. And whether you use a PC modem, smartphone, or any other internet-enabled device, Glo has variety of data plans for data subscribers.

Airtel, on its part, advised customers who perceived that they were being ripped off, to consider Airtel SmartSPEEDOO, an affordable data plan which can be used for all devices including smartphones and computers. Airtel in a statement, said it introduced its free data services, which offers some free megabytes fevery month just for being a subscriber on the Airtel network, with a validity of  30 days.

ISP’s Position 

ISPs who are licensed to provide internet service to customers, are already facing market challenges in the course of internet service delivery, occasioned by market competition from MNOs.

Although the sector has growth potential and contributing immensely to telecoms growth, the issue of high interest rate and high cost of equipment are threatening to crumble the once vibrant sector, providing  internet connectivity to homes, offices, organisations and individuals.

The Managing Director of Swift Networks, one of the few surviving ISPs in the country, Mr. Charles Anudu, however said ISPs would continue to ensure uninterrupted service supply if the market condition remain stable for business.

According to Anudu, ISP business is capital intensive and banks collect as much as 25 per cent interest rate per annum on loans offered to ISPs for purchase of equipment, which  has skyrocketed.

“Aside high interest rate and high cost of equipment, we spend so much in maintaining co-location sites that run diesel 24/7 and we are sometimes faced with destruction of underground fibre cables that transmit internet capacity from one location to another, thereby disrupting internet connectivity “ Anudu said.

Another ISP, who preferred anonymity, blamed the situation on the inability of the Nigerian Communications Commission (NCC), the telecoms industry regulator, to come up with the new data floor price that will determine the charges of internet service delivery and also protect the smaller ISPs from undue market forces from the bigger ISPs that are mostly telecoms operators, who are licensed to provide both vice as data services.

The situation, according to ISPs, is forcing traditional ISPs to go out of business, coupled with the harsh business environment in the country.

The effect has cut down on the current 103 licensed ISPs, as only few of them were able to renew their licenses in 2018 and  2019, an indication that more ISPs may have gone under this year.

Confirming the reduction in the number of licensed ISPs in the country, NCC said only 10 per cent of the 103 licensed Internet Service Providers (ISPs) in the country approached it for licence renewal last year.

This means that about 90 per cent of ISPS are out of business.

The commission said the larger telecoms industry of which ISPs are integral part, is beset with numerous challenges.

Regulator’s Initiative 

In order to address some of the challenges faced by telecoms subscribers over poor internet service, NCC, last year, directed operators in the telecommunication industry to begin data rollover with effect from  June 26, 2018.

Before the directive from the NCC, subscribers could not use their unfinished or unused data subscription after its monthly expiration. The unused data automatically became useless to them as soon as it hit the monthly expiration date.

NCC’s Executive Vice Chairman, Prof Garba Umar Danbatta, said then that telecoms operators must begin the implementation of the data rollover directive from June 26, 2018.

Danbatta gave the marching order at the 95th consumers outreach programme in Dutse, Jigawa State last year.

The NCC boss, who was represented by the Head of Information and Reference Unit of the commission, Alhaji Ismail Adedigba, said failure by the operators to start implementing the directive would attract N5 million fine on each subscriber whose data they failed to roll over.

“The NCC has directed the telecom service providers in the country to begin the implementation of data rollover on June 26, 2018. They have been duly informed about this and they have also been given adequate time to prepare their networks for it.

“Failure to implement this will attract N5 million fine on the first default and N500,000 on each day that follows the first default date.

“All these are to ensure that the consumers’ rights, privileges and interests are adequately protected,” he said.