The latest data released by the NCC, the industry regulator, show that internet subscriptions stood at 93.6 million in September, representing a y/y contraction of -3.6%. The figure implies density of 51% in a population estimated at 185 million, placing Nigeria well above the African average of around 16% as estimated by McKinsey. MTN emerged again as the leader, with 35% market share while Globacom and Airtel accounted for 29% and 20% respectively.
The NCC’s data on porting activity showed MTN accounted for the largest (44%) customer losses while Etisalat gained 13,365, representing 75% of total incoming porting data in September.
A recent survey carried out by DigitXplus, a digital media consultancy firm, revealed that China has the highest number of internet users with 632 million subscribers while the US comes in second place with 269 million. Internet subscriptions in India, Japan, Brazil and Russia are 198 million, 110 million, 105 million and 87 million respectively.
We recall that earlier this year, the industry’s regulator auctioned 14 slots of the 2.6 GHz spectrum. We gather that the commission is now gearing up to commence the licensing of broadband services on the 5.4 GHz spectrum.
This is expected to assist with achieving the FGN’s broadband penetration target of 30% by 2018. Broadband penetration is currently 21%.
Sources: Nigerian Communications Commission (NCC); FBNQuest Research
Based on the recent GDP data released by the National Bureau of Statistics (NBS), in Q2 2016 the telecommunications sector contracted by -11.6% y/y compared with a growth of 9.4% y/y in the corresponding period in 2015.
Although there is a visible slowdown on a y/y basis in internet subscriptions, going forward we expect to see further investments within the sector due to opportunities in the data segment.