Nigerians Splurge N2.6tn on Data and Airtime in 9-Month Data Consumption Frenzy

The expenditure on airtime and data by Nigerian telecom subscribers surged to a minimum of N2.59tn in the initial nine months of 2023, as reported by the financial statements of MTN Nigeria and Airtel Africa. This marked a significant 32.57% increase from the N1.95tn recorded by both telcos in the corresponding period of 2022. The escalation in voice and data revenue was driven in part by increased data subscriptions and the devaluation of the naira on Airtel’s part.

In the first nine months of 2022, Airtel generated $1.41bn from airtime and data, equivalent to N647.71bn at the exchange rate of N461/$ prevailing at the time. In the same period of 2023, the company’s income from these sources amounted to $1.29bn, which, when converted at the exchange rate of N777/$, totaled N1.003tn. Meanwhile, for MTN, the continued growth in data revenues played a pivotal role in the overall revenue expansion, with data revenues experiencing a robust 36.36% year-on-year growth, while voice revenues only saw a 10.64% increase.

Commenting on this growth, MTN attributed it to a 36.4% increase in data revenue due to heightened data usage and data conversion in both new and existing customer bases. The company reported a 29.1% growth in data usage on its network, with data traffic recording a notable 46.3% increase, and the 4G network accounting for 83.7% of the total traffic.

Airtel, on the other hand, observed an increase in data usage per customer to 5.9 GB per month, accompanied by a 29.3% growth in data revenue in constant currency. The firm’s data customer base grew by 17.4%, and data ARPU experienced a 12.3% growth. The widespread rollout of Airtel’s 4G network resulted in nearly 100% of all its sites delivering 4G services.

The surge in Internet usage, particularly for video streaming, contributed to telecom consumers spending N3.86tn on telecom services in 2022, marking an 18.74% increase from the N3.25tn spent in 2021. Data usage in the country saw a remarkable 46.77% increase to 518,381.78TB in 2022 from 353,118.89TB in 2021.

Data consumption is anticipated to be the driving force for telecoms growth, with expectations that data revenues will surpass voice revenues in the coming years. According to the World Bank, increased consumption of data services by households and businesses, coupled with higher subscriber numbers, is fueling growth in the ICT sector.

The Ericsson Mobility Report (June 2023) predicts that Sub-Saharan Africa will experience the highest growth in total mobile data traffic, rising by 37% annually between 2022 and 2028. This growth is attributed to continued investments in 4G networks and the migration of customers from 2G and 3G. The report forecasts a fourfold increase in smartphone traffic, with average data per active smartphone reaching 19 GB per month in 2028.

Reflecting on the trend, the President of the National Association of Telecoms Subscribers, Adeolu Ogunbanjo, emphasized the transformative impact of 2021 on online activities, citing the surge in remote work, increased online economic and commercial transactions, all reliant on robust telecom infrastructure.