How much do constant network outages cost businesses in Nigeria?

by MMC
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“Hello, hello, can you hear me?” said student Father Juslin for the 20th time in frustration, as she tried to contact her sister by phone. His newly acquired Glo SIM card seemed just as unreliable as his old MTN network. Three days before the call, his MTN connection had been a nightmare: calls were dropping, internet was disappearing. “I couldn’t make a call or browse for more than 2 minutes without my network completely shutting down. It was frustrating,” she said. The next day, MTN Nigeria experimented a prolonged network outage which disrupted its voice and data services for several hours. On social networks, the telecommunications giant blamed multiple fiber cuts, promising that engineers were rushing to remedy them. This was not the first nationwide shutdown for the network provider in less than a year. Last October, MTN experimented a similar outage, which she also blamed on multiple fiber cuts.

Yet the MTN challenge is only part of the larger problem. Since January, Airtel, another major network provider in Nigeria, experimented significant disruptions for most users across the country. Several Airtel users have reported Network unavailability for up to 6 hours on certain days. Glo, another leading network provider, faced a similar challenge. “During the MTN outage, most of the students in my school who use MTN networks had to buy Glo SIM cards. Only for the service to be terrible as well,” Juslin said. These frequent disruptions, as Juslin’s story illustrates, have serious consequences for various stakeholders.

The mystery behind Nigeria’s network disruptions

Network providers provide Internet access to customers, using different types of infrastructure and technologies, such as cable, DSL, satellite, wireless, and fiber optics. In Nigeria, fiber optic is the commonly used option by most network providers to provide internet service to their customers. A report by the Nigerian Communications Commission (NCC) reports that Fixed Wireless Access (FWA) accounts for over 70% of total internet subscriptions in the country.

Optical fiber is a technology that uses thin strands of glass or plastic to transmit data in the form of pulses of light. It offers high-speed, low-latency, symmetrical internet service, which means download and upload speeds are the same. Generally, fiber optic installations are quite reliable. However, this does not mean that they are indestructible. Even if a fiber optic line is well planned and constructed, it is likely that sooner or later it will be damaged, interrupting the availability of the network it powers. This damage may be due to bad weather, wildlife or construction work.

In Nigeria, fiber cuts are one of the most common causes of network outages. Vandalism is another common cause of power outages in Nigeria. According to the Nigerian Communications Commission report for the second quarter of 2023, vandalism of fiber optic cable infrastructure contributed to over 30% of all reported network outage incidents. According to a study According to Heavy Reading, mobile network operators experience an average of five outages or service deteriorations per year. The duration and impact of these outages may vary depending on the cause, location and severity of the incident. Fiber optic networks require a lot of investment and maintenance, as they involve laying new cables, installing optical network terminals and repairing damage. Therefore, network providers that offer fiber optic services generally charge higher prices than other types of Internet services.

The true cost of mobile network outages

Car seller Osaze Smart, who lives on the mainland in the commercial city of Lagos, faced a frustrating day on February 28, the day MTN experienced its recent disruptive nationwide shutdown.. Smart received a business call to come inspect and potentially purchase a car from a customer on the island, a 1 hour 8 minute (48.9 km) drive (without traffic). He woke up at 4:30 a.m. and left his house before 5 a.m. He had to leave early if he wanted to get to the island before the day’s heavy traffic started. He arrived early, but faced further delays due to his client’s unexpected delay. However, the biggest obstacle came when Smart’s MTN mobile network was down for hours. The sudden disconnection severed his connection with his client who was also an MTN customer. After several hours of waiting and hoping, Smart was forced to abandon the meeting without obtaining a potential agreement. “I ended up spending N20,000 on a ride-hailing service, with the disappointment of losing a business opportunity,” he said.

MTN has 92.71 million mobile subscriptions, making it the largest operator in Nigeria. The network’s mobile internet subscribers in Nigeria grown up by 9 million between May 2022 and May 2023. In addition to the growth in active data users, individual data usage increased by 29.1%, with data usage per user increasing to 8 GB. Active mobile subscriptions for MTN Nigeria, Airtel, Glo and 9mobile were recorded at 225.8 million in 2023. The Lagos Chamber of Commerce and Industry says 80% of businesses in Lagos alone to use Mobile Internet. Constant mobile outages can affect online communications and transactions, leading to lost productivity, lost revenue and customer dissatisfaction.

The impact of mobile network disruptions is greatest for businesses that rely on reliable internet connectivity for their entire operations. For example, businesses that rely on point-of-sale (POS) systems to accept payments may face delays and lost sales when outages occur. This can have a cascading effect, impacting other businesses in the supply chain. A report by the Nigerian Economic Summit Group (NESG) estimated that vandalism alone costs the Nigerian economy N21 billion annually due to lost productivity and repairs..

Constant network outages disrupt the daily activities of individuals and businesses. This slows Nigeria down broadband penetration objective. Outages could also discourage investment in new infrastructure and hamper efforts to expand mobile network coverage to underserved areas. According to has Ubale Maska, NCC Executive Commissioner, Technical Services, “Vandalism of mobile network infrastructure, particularly fiber optic cables, constitutes a major obstacle to national network coverage and the provision of quality services. » It can also stifle and discourage the adoption of digital financial services, particularly in underserved rural areas. Interestingly, tThe Nigerian government has priority the National Broadband Plan 2020-2025, aiming to achieve broadband penetration of 70% by 2025. This plan places strong emphasis on the deployment of fiber optic infrastructure. However, if these outages persist, Nigeria’s economic losses will also increase.

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