MTN Nigeria CEO warns of severe crisis in telecoms sector, predicts inevitable price hikes

Karl Toriola, CEO of MTN Nigeria, has declared that the telecommunications sector is in a “deep crisis,” facing significant sustainability challenges across the country. Speaking at the telecom investment forum organized by the Financial Derivatives Company (FDC) in Lagos, Toriola highlighted the threats posed by rising costs and unsustainable pricing.

He emphasized that a price increase has become unavoidable and is now an “absolute necessity” to prevent the sector from collapsing, describing it as being in “intensive care.” Toriola noted that investors are unlikely to commit funds given the current returns and warned that without necessary changes, new investment could cease.

He criticized the static pricing model, stating that it is unrealistic to maintain prices unchanged for 11 years amidst inflation and currency devaluation. Toriola pointed out that issues such as capital costs and infrastructure investments, including base stations and diesel generators, need to be addressed.

Despite some progress with regulatory authorities, Toriola acknowledged that the sector’s challenges are severe. He added that stakeholders are starting to grasp the crisis’s severity and are considering essential measures, including price adjustments and concessions.