ALTON: Telcos price review should be a simple regulatory process

The telecommunications industry in Nigeria is at a critical juncture, with the need for sustainable pricing strategies to ensure industry growth and attract the right investments. Gbenga Adebayo, the Chairman of the Association of Licensed Telecommunications Operators of Nigeria, emphasized the importance of a simple regulatory process for tariff reviews to achieve the right pricing structure. The key theme highlighted in the interview was the need to address key challenges within the sector to sustain investments and industry growth. Adebayo identified four critical issues that need to be tackled for the industry to thrive. Firstly, the lack of investment in the sector due to challenges in the operating environment, including high business costs and insufficient protection of infrastructure. Secondly, the issue of cost-related tariffs and pricing strategies was highlighted as crucial for industry sustainability. Thirdly, the independence of regulators was deemed essential to ensure a conducive ecosystem for telecom operators. The discussion revolved around the complexities of pricing determinations and the importance of striking a balance between industry sustainability and public concerns. Adebayo stressed the need for regulators to conduct independent cost studies to determine appropriate price ranges and ensure a fair pricing structure. He emphasized the necessity of considering external factors such as inflation rates and exchange rates in pricing decisions. Moreover, the protection of telecom infrastructure was underscored as a critical factor in sustaining the industry. Adebayo called for the classification of telecoms as critical national security and economic infrastructure to prevent willful damages and reduce the high costs of infrastructure rebuilds. He urged the government to provide the necessary protection to safeguard telecom infrastructure from potential threats. The feedback from government regarding pricing reviews indicated concerns about the high cost of living and inflation trends. While the government is cautious about tariff revisions, Adebayo highlighted the industry's need to price right to ensure sustainability. He emphasized that telecom operators should not be used as a palliative for high living costs but rather as a vital sector requiring strategic pricing decisions. The interview also touched upon the issue of suspended exercise duties on services and the collaborative efforts of stakeholders to address industry challenges. Adebayo commended the government for suspending the exercise duties in response to stakeholders' concerns and emphasized the importance of protecting consumer interests to maintain purchasing power and operator returns. As the telecom sector plays a critical role in Nigeria's economy and has attracted substantial foreign direct investment, Adebayo stressed the significance of addressing industry challenges to maintain investor confidence. He expressed optimism about ongoing stakeholder consultations and government engagements, indicating a positive outlook towards resolving industry issues. In conclusion, sustainable pricing strategies, regulatory clarity, infrastructure protection, and stakeholder collaboration are vital for ensuring the growth and sustainability of the Nigerian telecommunications industry. With concerted efforts from both industry players and regulators, the sector can overcome challenges and create a conducive environment for continued investments and technological advancement.