MTN Lifts Partial Ban on Glo Calls as Talks Intensify Over N4.4 Billion Interconnection Debt Dispute

MTN Nigeria has lifted the partial ban it placed on calls from Globacom subscribers to its network. The partial ban which lasted more than five days was a product of the interconnection dispute between the Mobile Network Operators.

According to the Nigerian Communications Commission (NCC), Globacom owes MTN a total of N4.4 billion in interconnection debt.

And the ban lift came as a result of an intervention by major stakeholders in the dispute.

Why does Glo owe MTN?

The debt reportedly arose from nonpayment of the interconnection rate by Globacom for calls terminating on MTN’s network. In 2018, NCC set the interconnection rate for calls at N3.90 per minute for 2G/3G/4G operators; N4.70 for LTE operators, while the international termination rate was placed at N24.40.

In December 2018, NCC gave mobile network operators power to disconnect faulting operators who had rising interconnection debts. Taking advantage of this, MTN effected a partial restriction of mobile communication to Globacom’s 4.6 million subscribers.

Formal responses from both MTN and Globacom have been difficult to obtain but unofficial sources at MTN as published on Businessday alleged that Globacom owes MTN up to N10 billion naira in unpaid interconnection fees as against the N4.4 billion NCC claimed they were owed.

Out of the total debt, inquires made by Punch revealed that Globacom only paid a sum of N500 million ignoring a payment deadline issued by the mobile network. The ban is seen as a decisive play by MTN to protest the failure to reach suitable agreement on the payment of the interconnection debt.

Globacom is yet to shed light on the issues as they have refused to comment on the restrictions. Its Communications Department, however, said there were ongoing discussions between the two companies towards a resolution.

Long-standing rivalry?

In the telecom industry, Globacom has been a major disruptor with a reputation for pushing the envelope.

Before Globacom hit the telecom market, major mobile network operators like MTN and Econet at the time used Per Minutes Billing (PMB) for calls. During this period, Calls which ended at 2min and 3secs were rounded up to 3 mins and by implication the subscriber was charged for 3mins. This billing system raised a lot of profits for mobile networks at the time. Globacom, however, went ahead to blow the market open with its introduction of the seconds per billing to the delight of telecom users.

But competition between the Telecom giants hasn’t been at all bad. Progress has been made in the industry as both MTN and Globacom now have 4G technology. However, the repercussions of the recent restriction has hurt both MTN and Globacom subscribers as many tried relentlessly to reach loved ones with little success while the ban was in place.

Although it is yet unclear what the damage is, it could have far reaching effects for both telcos.

It is hoped that the mobile networks will permanently resolve this dispute as further restriction will cause significant discomfort for their customers.