Nairametrics| Feelers coming from telecommunications companies (telcos) indicate that they may have no choice than to ban the use of mobile applications that allow unlimited voice and video calls between their users. The most popular examples of such applications are WhatApp and Skype. These applications are said to provide Over-The –Top (OTT) services but telcos are considering disabling Nigerians from accessing these applications. Here are 3 reasons telcos are giving.
- Loss of Revenue: According to the telcos, several billions of Naira accruable to them through voice and video calls over the mobile networks are being lost annually to these applications. “It is an aggressive approach to stop further revenue loss to OTT players on international calls, having already lost about N100tn between 2012 and 2017,” a manager at one of the major telecos in the country said. Supporting the telcos is a report from Ovum, a UK-based research and analytics company that indicated that $386bn loss would accrue over a period of six years – between 2012 and 2018 – from Nigerian customers using the OTT voice applications. MTN Nigeria has already complained that OTT content services have a “cannibalizing effect” on network operators’ voice and data revenue, because they provide “free” services, which duplicate those already provided by network operators such as voice calls and the SMS
- Proliferation of these apps: Another worrisome trend for telcos is the fact that the number of OTT voice applications continue to increase. Initially, it was majorly Skype, but several others like WhatsApp, Facebook, BlackBerry Messenger and Viber have joined the trail, making these applications more and more popular in the country. An estimate says that as much as 45% of Nigerian Internet users are active subscribers of WhatsApp alone. This means that a whole more Nigerians can use these apps for placing calls without paying a dime.
- Exploitative nature of the apps: Telcos claim that the situation will not have been so bad had it not been for the exploitative nature of the apps. According to them, these applications use the telcos network infrastructure to facilitate the services but pay nothing back to the company for this. Rather, telcos in a bid to retain users, have to continue to upgrade their infrastructure. “For instance, to date, MTN has invested over $15bn in building its network in Nigeria. You can now imagine an OTT leveraging the network to deliver its content without investing a kobo locally. The impact on revenue is huge…They do not pay taxes, they do not employ any people locally, and indeed, they have no local presence whatsoever, meaning they do not make any contribution to our economy and their services are denying those who make contributions of income.” Funso Aina, Public Relations and Protocol Manager, MTN Nigeria said, according to Punch Newspapers.
With this train of thought, it is easy to believe that Nigerian telcos will gladly grab the opportunity to ban their subscribers from using these services. However, the situation is not as simple as it sounds. These services form one of the major attractions of Nigerians to internet usage in the first place. As such, any move to ban them is likely to result in heavy out flock from such networks. In a country, where the competition for subscribers is at a fever pitch, banning OTT apps may be a suicidal mission.