25 January 2013

Nigeria: Phone Subscribers to Save N1.6 Billion, As FG Cuts SMS Rate

Mobile phone subscribers in Nigeria are set to save N1.63bn daily with the implementation of a new price cap of N4.00 for all domestic off-net Short Messaging Service (SMS) interconnect rate with effect from February 5, 2013.

Prior to this, operators charged subscribers N9.00 for terminating a single SMS on another network.

Nigeria's 109 million mobile phone subscribers send an average of three SMS daily across each network. Yesterday, the Nigerian Communications Commission (NCC) said it was yet to place a price cap on international SMS, adding that it was still consulting with stakeholders on new rates for voice call termination.

The current mobile termination rates (MTRs) called were supposed to have ended by December 31, 2012 with new rates taking effect from January 1, 2013 for voice and SMS traffic lasting over the next three years.

The directive signed by the Director, Legal and Regulatory Services, NCC, Ms. Josephine Amuwa, said they arrived at the new price cap after due considerations of the submissions made by the operators at various consultative meetings. "There was a general recognition that the cost of SMS is too high, especially in view of the interconnection rate of N1.02 (One Naira, Two Kobo Only) for SMS as determined by the Commission in 2009".

She noted that the operators had proposed a price cap ranging between N5-10 per message for Off-Net SMS. The operators also urged the Commission not to set a cap for international SMS due to the fact that interconnect rates for International SMS are outside their control as it is terminated through international carrier service providers in various jurisdictions.

Amuwa said that based on these considerations, and in the interest of striking a balance between sustaining operator's profitability and ensuring consumer satisfaction, and also in accordance with the powers conferred on the Commission under Sections 4 and Chapter V11 of the Nigerian Communications Act, 2003, the following determination was made by the Commission.

LEADERSHIP in a telephone interview with Mr. Reuben Mouka, head, media and public relations, NCC, he said the regulator was still consulting with the operators on the voice interconnect rate.

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