Nigerian Telecom Companies Face Tougher Quality Standards as NCC Introduces New KPIs, Fines

The Nigerian Communications Commission (NCC) has introduced a new set of Key Performance Indicators (KPIs) aimed at improving the quality of service provided by telecom companies across the country.

These new regulations, targeting 2G, 3G, and 4G networks, are designed to address longstanding issues such as dropped call rates, call setup success rates, and network congestion, among others.

Each of these KPIs is backed by stringent financial penalties. Operators that fail to meet these standards will face fines of ₦5 million per infraction, with an additional ₦500,000 imposed daily until the issue is resolved.

The NCC has mandated that telecom operators submit their Quality of Service (QoS) reports monthly. In addition, the Commission will conduct its own measurements, potentially utilising methods such as drive tests, consumer surveys, and data collection from its Network Operations Centres (NOCs).

Specific Targets and Their Implications

The KPIs prescribed by the NCC cover a range of technical parameters that telecom operators must adhere to. Among these are:

1. Dropped Call Rates: The frequency of dropped calls should be minimised to ensure consistent connectivity.
2. Call Setup Success Rate: The success rate of call setups should be high to maintain consumer confidence in network reliability.
3. Traffic Congestion: This metric addresses network congestion, particularly during peak hours, which often results in reduced service quality.

The KPIs also include measures for other aspects of service quality, holding telecom operators accountable for overall network performance.

These KPIs align with the Strategic Agenda 2023 of the Minister of Communications, Innovation, and Digital Economy, Dr Bosun Tijani. This agenda includes targets such as increasing Nigeria’s broadband penetration rate to 70 per cent by the end of 2025, providing download speeds of 25 Mbps in urban areas and 10 Mbps in rural areas, and achieving 80 per cent population coverage by 2026.

The introduction of fines for lapses in service quality marks a significant shift in the NCC’s regulatory approach. The last notable instance of a fine for QoS-related issues was in 2020, when Airtel was fined ₦2.3 billion for disconnecting Exchange Telecommunications Limited without regulatory approval. Similarly, in 2019, all four GSM operators—MTN, Airtel, Glo, and 9Mobile—were collectively fined ₦2.97 billion for various infractions, including those related to Quality of Service.

These stringent KPIs and associated penalties come at a time when telecom operators are already under substantial financial pressure. The depreciation of the naira, coupled with high inflation, has significantly increased operating costs.

As a result, operators have been forced to cut down on operating expenses, which has negatively impacted their ability to invest in network upgrades and expansions. They argue that, given these financial challenges, the NCC should permit an increase in tariffs to offset the additional costs. Without the ability to increase revenue through higher tariffs, they contend it will be difficult to meet the new KPIs while simultaneously ensuring quality service for consumers.

Ultimately, the success of these new regulations will hinge on striking a balance between strict enforcement and the economic realities faced by telecom companies, which are feeling the pressure of these increased demands.

Subscribe to Notifications