Spectranet is one of the foremost internet service providers (ISP) in Nigeria and was the first to introduce 4G LTE internet service in the country. As a result, the company controls about 50% market share and still has a lot of growth potentials. Unfortunately, Spectranet is currently faced with many problems which are now threatening its market share. Will the company be able to overcome said challenges and maintain its leadership position in the internet services sector, or will it soon be overtaken by the many competitors vying for fairer shares of the market? These issues will be discussed. But first, let’s get to know more about Spectranet.
The emergence of Spectranet
Spectranet Limited came to Nigeria in 2009 after being awarded an operational license by the Nigerian Communications Commission (NCC). The company’s emergence in the ISP market space was defined by one clear objective- to ensure widespread internet connectivity across Nigeria. To a large extent, it can be said that this objective has been considerably actualised, as the company currently has a widespread customer base. Spectranet is present across many Nigerian cities, including the major ones such as Lagos, Abuja, Port Harcourt, and Ibadan, etc.
As an internet service provider, Spectranet basically offers internet boxes (i.e., Wifi and Mifi modems/routers), as well as different data packages. Examples of its Mifi and Wifi products include Spectranet Portable Mifi (₦35, 000), Spectranet Outdoor Modem (₦70,000), Spectranet Indoor Wifi (₦35,000), and Pebble MIFI 2017. Others are Spectranet’s Wifi router starter pack (₦16, 000), TOZ Indoor CPE (₦25, 000) and Freedom Mifi 2017 (₦16,000).
Spectranet also offers a wide variety of data plans to go with their modems. The company offers different monthly plans that cater to different Nigerians according to their purchasing powers; examples of which include Unified Value 40GB (₦12,500), Unified Value 55GB (₦20,000), Unified Value 200GB (at ₦70,000) and the Unlimited Gold Plan (at ₦18,000), etc.
A look at the competition
According to the NCC, there are more than a hundred licensed internet service providers in Nigeria, all of which are competing with one another for their own shares of the market. Spectranet has roughly about 50% market share with nearly 200,000 subscribers out of a total of about 400,000 active subscribers. Meanwhile, asides competing with one another, the ISPs also compete with Mobile Network Operators such as MTN, 9mobile, and Glo, etc. All of which altogether control about 95 million users.
Spectranet’s challenges – regulatory, operational and infrastructural
Spectranet has over the years struggled with many challenges ranging from regulatory, infrastructural and operational. This has severally prompted the company’s management to join other stakeholders in the sector to decry what they perceive as unfavourable regulatory policies, especially the government’s unfavourable data pricing policy. Last year, the company’s former Chief Executive Officer, David Venn, called on regulators to ensure sanity in the sector and most importantly, make provision for a data floor. According to him, there is a lot of prevailing anti-competitive behaviour in the market which is affecting the sector. In his words, “since the botched data floor policy of Nigerian Communications Commission, it has become difficult for ISPs and Telcos delivering internet service to operate profitably. We are seeking the review of that policy by the authorities to enable operators to deliver quality service and continue to be in business.”
Speaking further, Mr. Venn stated that “another biggest challenge we are facing today is the cost of tower rentals which has continued to increase over the years. It is funny, that international capacity cost has reduced by 50 percent while tower rental cost is increasing unabated. Imagine a situation where the cost of tower rental in three times our salary cost.”
The company also faces other infrastructural challenges, including epileptic power supply and occasional vandalisation of their facilities.
Internal problems
Just like most Nigerian companies have had their former staff members say very unpleasant things about them, Spectranet has also been badmouthed by its ex-staff. According to a former Spectranet employee who spoke to us on condition of anonymity, the company’s not-too-pleasant working conditions may be another major problem contributing to its challenges. According to the anonymous source, the company has a reputation of not paying its staff well, especially at lower levels. This leaves them unmotivated; a situation that is inevitably reflected in the quality of service delivered to customers.
It is also alleged that quite a number of the company’s staff always leave the company in pursuit of better opportunities elsewhere. This again affects the consistency of the quality of service delivered.
The Customers are not very happy
Quite a number of Spectranet’s customers are unsatisfied with the quality of service they receive from the company. A quick look at their social media platforms will confirm this. Most customers’ complaints centre on the constant letdowns they experienced – the poor nature of the network, and irresponsive customer service. These customers feel cheated by Spectranet whom they say parades itself as the best ISP in Nigeria while selling products and services that do not work. Some even go as far as calling the firm “fraudulent” for parading themselves as a 4G lite provider, even though their internet service can at best be classified as a 3G network.
A Twitter poll conducted by Nairametrics asked consumers to choose between Spectranet and Smile, or comment on their reservations against the two. Out of the total number of people that participated in the poll, 27% chose Spectranet as their favorite, while 26% chose Smile. The remaining 47% registered their dislike for both brands, including Towsyn Omowole who said that “they are both bad, to be honest. It depends on your location. We just manage them.”
In conclusion, Spectranet has a huge business potential in Nigeria. Its growth potentials are equally endless. Therefore, the company cannot afford to allow anything jeopardise its future in the Nigerian market. It is for this reason that we are recommending that the company do everything possible to sort out its challenges and keep its customers satisfied in order for it to sustain its market share and possibly improve on it with time.