P
ProfRem
Guest
The Nigerian Communications Commission (NCC) has said that data hike is inevitable in Nigeria’s telecom industry.
Josephine Amuwa, Tony Ojobo and Abubakar Yakubu, who are the NCC’s Directors of Policy, Competition &Economic Analysis, Corporate Afffairs and Tariff Competition respectively, said the introduction of price floor for data services was also to address market distortions, unhealthy price wars and value erosion that could threaten telecoms business in Nigeria.
They premised his argument on three reasons:
1. foreign exchange issue
2. high operating cost and
3. the need to protect smaller operators from closing shops have made data price hike inevitable in Nigeria’s telecom industry.
Disclosing this at a press conference in Abuja yesterday, three top NCC officials said the current data price regime was unstainable as “it could kill the industry.”
Explaining further why hike in data price is inevitable, Amuwa said an unnamed dominant operator was engaging in predatory pricing to drive down prices and drive out other operators.
“Where this is successfully executed, the dominant operator will then increase prices to the detriment of the subscribers. If this is allowed to happen, the industry could be moving towards a monopoly”, the NCC Director said.
On the belief that market forces should be used to determine the prices, Amuwa said due to the Nigeria’s telecom market imperfections, market forces alone could not be entirely relied upon to ensure efficiency.
Josephine Amuwa, Tony Ojobo and Abubakar Yakubu, who are the NCC’s Directors of Policy, Competition &Economic Analysis, Corporate Afffairs and Tariff Competition respectively, said the introduction of price floor for data services was also to address market distortions, unhealthy price wars and value erosion that could threaten telecoms business in Nigeria.
They premised his argument on three reasons:
1. foreign exchange issue
2. high operating cost and
3. the need to protect smaller operators from closing shops have made data price hike inevitable in Nigeria’s telecom industry.
Disclosing this at a press conference in Abuja yesterday, three top NCC officials said the current data price regime was unstainable as “it could kill the industry.”
Explaining further why hike in data price is inevitable, Amuwa said an unnamed dominant operator was engaging in predatory pricing to drive down prices and drive out other operators.
“Where this is successfully executed, the dominant operator will then increase prices to the detriment of the subscribers. If this is allowed to happen, the industry could be moving towards a monopoly”, the NCC Director said.
On the belief that market forces should be used to determine the prices, Amuwa said due to the Nigeria’s telecom market imperfections, market forces alone could not be entirely relied upon to ensure efficiency.
