Can Nigeria sustain internet subscription growth?

Nigeria has been experiencing steady growth in active internet subscriptions over the past year, with figures reaching 164.4 million as of March this year, according to data from the Nigerian Communications Commission. However, the trajectory has not been without its ups and downs, as highlighted in a recent interview on CNBC Africa with Obafemi Banigbe, Senior Partner, Strategy and Technology at Africa Context Advisory Partners. Banigbe shed light on the fluctuating numbers, attributing them to factors such as SIM registration challenges. He emphasized that Nigeria has one of the highest multi-SIM ratios globally, with many individuals owning multiple SIM cards for various reasons including network connectivity issues. This means that the reported 164 million subscriptions do not necessarily translate to 164 million unique users. In terms of sustaining this growth, Banigbe highlighted the need for ongoing investment in infrastructure to enhance coverage and service quality. He noted that operators are facing challenges due to currency devaluation, which is impacting their revenues and capital expenditure. The Nigerian government has taken steps to address infrastructure challenges by approving a Special Purpose Vehicle (SPV) to expand the nation's fibre optic network by 90,000 kilometers. Talks with Development Finance Institutions (DFIs) and other stakeholders are progressing positively, aiming to boost connectivity and internet access across the country. One of the key challenges discussed during the interview was the issue of GSSD debt, with Telcos expressing concerns about slow payments. Banigbe emphasized the importance of banks and telecommunication operators collaborating to find sustainable solutions to ensure access to electronic and mobile banking services while addressing payment issues related to infrastructure usage. Looking ahead to the second half of the year, Banigbe forecasted a stabilisation phase for Telcos, as they navigate the impact of currency devaluation on their investment plans. He anticipated a cautious approach from operators, with potentially lower capital expenditure in 2024. As the world increasingly depends on the Internet of Things, the importance of robust telecommunications infrastructure cannot be overstated. Banigbe stressed the need for continued support and investment in the Telco sector to meet growing connectivity demands and drive economic growth. In conclusion, Nigeria's internet subscription growth presents both opportunities and challenges. Sustainable growth will require ongoing investment, collaboration between industry stakeholders, and strategic planning to address economic uncertainties and infrastructure needs.