9mobile Looks to Reclaim Lost Subscribers with $220M Investment in 4G Expansion Across Nigeria
Telecom operator, 9mobile has announced an investment of $220m in the expansion of its 4G offerings in Nigeria. The operator explained that the expansion was part of its efforts to deepen broadband penetration in the country.
Speaking on the development, The Managing Director of 9mobile, Stephane Beuvelet revealed that the investment is part of the company’s plans to implement in 4G expansion drive in Lagos, Abuja, Aba, Nasarawa and 12 other Nigerian cities.
9mobile has lost over 8 million subscribers
9mobile, currently Nigeria’s 4th largest telecoms provider had a very rough 2019 as it continues to suffer from the effects of its financial troubles.
In June 2017, 9mobile (then Etisalat) ran into financial difficulties after failing to meet the requirements of a $1.2 billion loan it obtained in 2013 from a consortium of 13 Nigerian banks. The banks included Guaranty Trust Bank and Access Bank.
Although 9mobile, later repaid $251 million of the loan from the proceeds of its acquisition by Teleology in 2018, the company is still struggling to win back its market.
Due to the uncertainty surrounding the survival of 9mobile during the height of the crisis and the change of name from Etisalat to 9mobile, many of its initial subscribers lost trust and moved on. 9mobile lost over 8 million subscribers in the last 3 years as its subscriber base stood at 8,068,175 as at December 2019
9mobile has a new lifeline
Although 9mobile lost a lot of subscribers last year, recent reports show signs of resuscitation as the telecom registered the highest number of incoming ports from other telecoms.
Most importantly, in August 2019, the telecom company obtained a $230million loan facility from the Africa Finance Corporation (AFC) to help re-position its brand after its Financial troubles.
Growing interest in 4G…
In the last year, broadband penetration in Nigeria has risen to about 33% and still growing. According to Jumia’s 2019 Mobile Report, about 44% of Nigeria’s 120 million internet subscribers use 3G, with just 4% connected to 4G technology,
However, there is a growing demand for 4G as more internet users are opting for 4G enabled sims especially in urban areas. There has also been an increase in 4G expansion as more telcos like MTN and Airtel are using it as marketing strategy to draw in more subscriber.
Investment in 4G penetration to provide faster internet service for it subscribers can be a very good strategy for 9mobile to draw in more subscribers as subscribers are always looking for the fastest internet service.
According to Beuvelet, the company’s investment into infrastructure would guarantee first-class experience for its customers including a low latency rate for high-speed connectivity and planned redundancy to minimize downtime impact.
Currently, the telecom says it has added 10 new cities and towns to its 4G network and upgraded LTE services in the existing six cities. Beuvelet also revealed that the company plans to cover the entire country within the next five years.
Although, 9mobile recently raised a significant $230million, spending $220 million dollars on infrastructure raises the question of whether the telecom company is financially buoyant enough to make such an investment.
The company is still recuperating from financial blows and a recent NCC fine of N5 million it incurred for subscribing thirteen numbers on full ‘Do Not Distur’b messages (DND) to Value-Added Services (VAS). This has put a significant strain on their books and such a significant investment in infrastructure may be too soon.
However, with strong market rivals like MTN, Airtel and Glo, an investment in 4G technology could be much needed strategy to help the company significantly raise its numbers.
If you’d like to get featured on our Entrepreneur Spotlight, click here to share your startup story with us.
Get latest Technology news, reviews, business-related content with a deliberate emphasis on the African narrative and insightful analysis in Nigeria – straight to your inbox.