Rural Base Station Operations Cost 35% More, Say Telcos

Telecommunications companies in Nigeria have reported that operating base stations in rural areas costs 35% more than in urban locations. This disparity, attributed to infrastructural challenges and logistical complexities, is a key factor deterring telcos from expanding network coverage to underserved communities.

A representative of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) explained that the higher operational costs in rural areas stem primarily from unreliable electricity supply, which necessitates the use of generators and expensive diesel to power base stations. Additionally, poor road infrastructure increases the expense and difficulty of transporting equipment and conducting maintenance.

“Providing connectivity in rural areas is significantly more challenging due to the absence of basic infrastructure. The cost of diesel, transportation, and security for these remote locations all contribute to the 35% premium on operations,” the representative said.

Telcos also face lower revenue potential in rural areas compared to urban centers. Rural communities often have lower population densities and less disposable income, reducing the average revenue per user (ARPU). This financial disparity makes it harder for telecom operators to justify the higher operating expenses associated with rural networks.

Despite these challenges, telcos recognize the importance of rural connectivity in bridging Nigeria’s digital divide and promoting socioeconomic development. Expanding rural network coverage can enhance access to education, healthcare, and financial services, contributing to broader national growth objectives.

To address the cost barrier, telecom operators are urging the government to introduce policies that support rural network expansion. Recommendations include providing subsidies for rural infrastructure, reducing taxes and levies on telcos, and offering incentives for the deployment of renewable energy solutions.

The Nigerian Communications Commission (NCC) has also been called upon to accelerate its efforts in driving universal access. Through initiatives like the Universal Service Provision Fund (USPF), the NCC aims to incentivize the deployment of telecommunications infrastructure in unserved and underserved areas.

Experts argue that fostering partnerships between government, telcos, and private investors is critical to overcoming the economic and logistical hurdles of rural connectivity. Additionally, adopting innovative solutions, such as solar-powered base stations, can help reduce reliance on diesel and cut long-term operational costs.

Rural connectivity is seen as essential for unlocking Nigeria’s economic potential. Expanding internet access to remote areas can empower small businesses, improve agricultural productivity, and enable digital inclusion for millions of Nigerians. However, achieving this requires a concerted effort to mitigate the high costs associated with rural network operations.

As discussions around rural connectivity intensify, stakeholders are optimistic that collaborative solutions will emerge to ensure that rural communities gain equitable access to telecommunications services, driving inclusive growth across the country.