Business

Q3: Telcos record surge in data usage

…generate N227bn in 3 months

Telecommunications subscribers in the country are consuming more data compared to voice calls, leading to astronomical growth in data revenue for the service providers, New Telegraph has learnt. This was revealed in the financial results of the two leading mobile network operators, MTN and Airtel, for the third quarter of this year. Between June and September, the two operators raked in a total of N227 billion as revenue from data. Although voice revenue for the two operators was higher than that of data, the growth rate of data revenue is far higher than voice.

While MTN, for instance, recorded a 5.6 per cent growth in voice revenue for the quarter, data revenue increased by 57.3 per cent. Similarly, on the Airtel network, voice revenue for the period grew by 27.1 per cent, while data rose by 41.5 per cent. Specifically, MTN’s data revenue for the third quarter stood at N137.7 billion compared with N87.5 billion recorded in the same period last year. Airtel, during the same period, recorded N89.5 billion ($179 million) data revenue, compared with N67.5 billion ($135 million) it recorded in the same period last year.

Commenting on the company’s data revenue performance for the quarter, the Chief Executive Officer of Airtel Nigeria, Mr. Karl Toriola, said the growth was driven by the increase in data consumption by Nigerians and the expansion of its 4G network across the country. “Data revenue maintained an accelerated growth trajectory in Q3 as we continue to drive increased data conversions from the existing base, aggressively expand 4G coverage and enhance the capacity of our network to support increasing data traffic,” he said. According to him, the average megabyte (MB) per user rose by 58.2 per cent year-on-year, enabling overall data traffic growth of 85.5 per cent YoY. “Also, smartphone penetration on the network grew by 3.5pp to 48.7 per cent. Our 4G network now covers 69.2 per cent of the population, up from 60.1 per cent in December 2020,” Toriola added.

Airtel Nigeria also disclosed that its data revenue growth was driven by the growth in data usage per customer to 3.9 GB per month (from 2.7 GB per month in the prior period). “This, in turn, drove data Average Revenue Per User (APRU) growth of 41.4 per cent. Expansion of our 4G network, with 88.8 per cent of total sites now on 4G, and an increase in smartphone penetration further supported the growth in data usage,” said Airtel Africa CEO, Segun Ogunsanya. While noting that data is one of the key growth drivers in Nigeria, he said that data accounted for 39.1 per cent of the company’s total revenue, up from 3.4 percentage points from 35.7 per cent in the prior period. “4G data usage accounted for 70.1 per cent of total data usage in Q2’22 (June-September 2021), up from 61.6 per cent in Q2’21 and the 4G data customer base now contribute 42.4 per cent of the total data customer base in Nigeria,” Ogunsanya stated.

Highlighting efforts that led to the increase in data usage, Airtel said: “We continue to focus on increasing smartphone ownership and increasing data usage at scale, largely via smartphone offerings through OEM (Original Equipment Manufacturer) device partnerships, and through expanding our network of smartphone device selling outlets. “Our improved 4G network contributed to an increase in smartphone penetration, in data customers and up-take of large data volumes, resulting in greater data consumption per customer.” Meanwhile, industry analysts said that that rapid increase in data usage as opposed to voice calls may not also be unconnected with the proliferation of Over the Top Services (OTTs) such as Facebook, WhatsApp, Wechat, IMO, among others, through which subscribers can also make voice and video calls using their data subscriptions. Before now, the telcos had complained bitterly about the operations of the OTTs in Nigeria, saying that they are eating deep into their voice revenue. However, the telecoms regulator, NCC, had countered them noting that the OTTs are driving data revenue growth for the operators since a subscriber would have to pay for data before making calls over any of the platforms.

 

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