Nigeria’s Mobile Data and Call Prices Dropped by 142% in 2019 but it’s Still too Expensive for Many
The average cost of high usage of mobile data and voice bundle in Nigeria dropped by over 142% in 2019. According to ICT Price Trends 2019, the average price of high consumption of mobile and internet data is $6.73, which is significantly lower than $16.34 recorded in 2018.
Globally, the average price of mobile data and voice continues to fall, with high consumption of data and voices estimated to cost about $25. However, the report confirms that broadband services can still be too expensive for the poorest consumers.
The drop in average prices is not necessarily true of all countries or of the entire population, especially in countries with a low Gross National Income per capita (GNI p.c).
Affordability of ICT Services in 2019
ICT Price Trends 2019 by the International Telecommunication Union (ITU) determines the affordability of ICT services by analysing and comparing price data for mobile-voice services, mobile data and fixed broadband for countries across the globe.
The report highlights the average prices for the five price baskets namely low and high usage of combined mobile-data and-voice, mobile-voice, mobile data and fixed-broadband.
High consumption mobile data and voice
The ITU mobile data and voice baskets include voice, text messages and data for two different consumption levels. The high consumption of mobile data and voice basket includes 140 voice minutes, 70 SMSs and 1.5 GB of broadband data.
Nigeria ranked 107 globally in the affordability of high consumption mobile data and voice basket. This up from 133 it ranked in 2018. The average price was pegged at $6.73, which is about 4.1% the GNI per capita.
In Africa, a high-consumption mobile data and voice basket accounted for over 31.2 per cent of GNI p.c., nearly one-third of the average GNI p.c. in the continent.
Globally, this basket shows little difference was evident in absolute prices between developed, developing and least-developed countries. However, prices as a percentage of income reveal huge gaps between prices for different levels of development.
Low consumption mobile data and voice
The low-consumption mobile-data-and-voice basket includes 70 voice minutes, 20 SMSs and 500 MB of broadband data. The average price of this basket in Nigeria was pegged at $6.53 with a rank of 114 globally. This is down from the 112 it ranked in 2018 when it was cheaper at $6.5.
In Africa, the low consumption of mobile data and voice basket accounts for 16 per cent of GNI p.c. Globally, the basket shows a large difference in absolute price levels and % GNI p.c between the different levels of development.
In most countries, an entry-level mobile voice basket remains fairly affordable. According to the report, low-usage mobile voice plan in 70 countries cost less than 1% of GNI p.c., and below 2% in 37 other countries.
Mobile-voice analyses the prices for a basket combining 70 voice minutes and 20 SMSs
Generally, between 2008 and 2019, the global average price of a mobile-voice basket has dropped from $21.4 to $11.8. Also, the affordability gap between developed and developing countries has reduced from 9% to 2.9%.
In Nigeria, the average cost of mobile voice basket is $6.02, which is down from $6.4 in 2018. The country ranked 132 globally climbing four spaces. The basket as a percentage of GNI p.c. also dropped to 3.7%.
The report generally shows that combined data and voice basket is less expensive than the sum of the two separate baskets.
The average cost of a mobile data of 1.5 GB is $3.92 in Nigeria. This is an increase from the $3.9 recorded in 2018. According to the rankings, the country stands at 105, down from 104 in the previous year.
Nigeria has one of the most affordable mobile data prices in Africa, ranking 4th in % GNI p.c.
Globally, the average price of a mobile data basket is 3.2% of GNI p.c. This a huge drop from 8.4% of GNI p.c. recorded in 2013. Over 95 countries including 47 developing countries have already attained less than 2% GNI p.c. for the mobile data basket thereby meeting the 2% benchmark set by the UN Broadband Commission for Sustainable Development.
The global average price of a mobile-data of at least 1.5 GB dropped by 7% on average annually between 2013 and 2019.
In 48 countries, which includes 7 LDCs, mobile data prices are just above the Broadband Commission Target, at 2-5 per cent of GNI p.c. In the remaining countries much is still need to reach the 2% target by 2025.
9 Least developing countries (LDC) still have mobile data prices of more than 20 per cent of GNI p.c.
The global average price of an entry-level fixed-broadband subscription is $27. This is a huge drop from the $44 recorded in 2008. However, the report indicates an apparent levelling of prices since 2016.
Europe is the region with the lowest fixed broadband prices with a percentage of GNI p.c. of 1.4%. Africa’s stands at about 33.3%. This shows a high difference in affordability depending on the level of development.
In Nigeria, the average price of the fixed broadband basket of 5G with greater than or equal to 256 kbit/s stands at about $41.17. This is a slight difference from the $41.12 pegged in 2018. The % GNI p.c and global rank remained unchanged at 25.2 and 155 respectively.
Despite the minute improvement in affordability, fixed-broadband subscriptions keep on rising steadily, highlighting the importance of fast and reliable internet connections.
The introduction of a variety of text, voice and video services by social platforms such as Facebook, Google, and WhatsApp to compete with traditional telecommunication among other things have stimulated the reduction in cost.
However, the falling prices have not translated to rapidly increasing Internet penetration rates, especially in the least developed countries (LDCs). This points to the fact that affordability may not be the only barrier to Internet penetration.
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.