Inflation: Ayotunde Coker advocates ‘tiered pricing’ to sustain Nigerian telecom businesses

Chief Executive Officer of Open Access Data Centre (OADC), Dr. Ayotunde Coker, has advised Nigerian telecom operators to embrace a tiered pricing model, where affluent consumers could pay for premium services, allowing for more affordable options to be offered to the broader population.

Coker stated this on Saturday during the ThePressNG Industry Spotlight webinar themed “Beyond Connectivity: Telcos and the Future of Financial Inclusion in Nigeria.” 

He noted that despite inflationary pressures and the broader cost-of-living crisis, telecom operators in Nigeria have been unable to modify regulated pricing.

Coker emphasized the need to strike a balance between controlling inflation and ensuring that telecommunications services remain accessible to all segments of society.

While noting that telecom operators must become creative in their pricing to achieve business sustainability amid the current inflationary challenge, he said:

“We must graduate products and services to fit different segments of society. More affluent consumers can afford certain services, which helps subsidize lower costs for others who rely on basic, essential telecom services.” 

“There are ways to innovate, such as offering services during specific times of the day for those who need them for essential purposes, like education or healthcare,” he added.

Coker also stressed the critical need for capital investment in telecom infrastructure, warning that without it, the quality of services such as broadband could deteriorate, further impacting economic growth and digital transformation.

He highlighted the role of broadband in powering industries and improving the quality of life for Nigerians.

“If we don’t invest in capital infrastructure, our broadband will keep failing, and all the benefits we talk about in terms of digital connectivity will disappear,” he said.

Coker pointed out that systemic issues related to the cost of infrastructure development, such as building telecom towers and data centers, need to be tackled through innovative solutions.

One such approach, he suggested, is for the industry to collaborate and share resources, optimizing costs and ensuring a sustainable rollout of infrastructure.

Amid high inflation and forex crisis that has rocked the Nigerian economy over the last 16 months, telecom operators under the aegis of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) have been clamouring for a review of the current tariff regime. However, the Nigerian Communications Commission, which regulates prices in the industry, has refused to grant the telcos’ requests.