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The Nigerian Communications Commission (NCC) has commenced a comprehensive review of Mobile Termination Rates (MTR), marking the first major reassessment of the wholesale pricing framework since the current rates were introduced in 2018.
RELATED: NCC issues new International Termination Rate
A stakeholders’ consultative forum in Lagos marked the official launch of the review. This initiative signals the regulator’s commitment to revising interconnection pricing. The goal is to ensure alignment with Nigeria’s changing economic, technological, and competitive environment.
What Mobile Termination Rates Mean for the Telecom Sector
Mobile Termination Rates are wholesale per-minute charges paid by one telecom operator to another to terminate calls on a different network. In Nigeria, these rates are regulated by the NCC to promote fair competition, prevent market abuse, and protect consumers from inflated retail prices.
According to the NCC, termination rates form the foundation of wholesale interconnection. These rates directly influence retail tariffs, service quality, infrastructure investment, and overall sector sustainability.
Current MTR Structure and Market Concerns
Presenting a consultancy document on the review process, the NCC’s Head of Competition and Tariff, Mrs. Omotayo Mohammed, noted that the existing rates no longer reflect prevailing industry realities.
- Generic operators: ₦3.90 per minute
- New entrants: ₦4.70 per minute (asymmetric rate to support market entry)
- Last review: 2018
“These rates have remained unchanged for nearly a decade, despite significant changes in the operating environment,” Mohammed.
She warned that misaligned termination rates could enable dominant operators to foreclose smaller competitors, deter investment, and ultimately burden consumers.
Why the NCC Is Reviewing MTR Now
The review is being undertaken in collaboration with KPMG Nigeria and is driven by multiple structural shifts in the telecommunications ecosystem:
- Macroeconomic pressures: Naira depreciation, high inflation, and rising energy costs have drastically altered operators’ capital and operating expenditure profiles.
- Technological evolution: Widespread deployment of 5G, increased use of Artificial Intelligence (AI), and the expansion of Internet of Things (IoT) services have reshaped network usage patterns beyond assumptions in the 2018 cost model.
- Market disruption: Growth in Over-The-Top (OTT) services such as WhatsApp and Telegram calls, alongside the emergence of Mobile Virtual Network Operators (MVNOs), has changed traditional voice traffic flows.
Scope of the Review and Regulatory Framework
The MTR review is being conducted under Sections 4, 96, 97, and 108 of the Nigerian Communications Act 2003, which mandate the NCC to promote investment, ensure fair competition, and protect consumers.
Key areas under consideration include:
- Development of a cost-reflective MTR framework across different technology generations and operator categories
- Review of asymmetric rate structures between large operators and new entrants
- Establishment of a pricing framework for MVNOs
- Assessment of International Termination Rates (ITR) to address grey-route traffic
- Review of USSD services and Application-to-Person (A2P) SMS, which are increasingly central to Nigeria’s digital economy
The consultancy process is expected to last four months and will follow an evidence-based, consultative approach.
Expected Outcomes for Competition, Consumers, and Investment
According to the NCC, the review aims to deliver multiple sector-wide benefits:
- Fair competition: Preventing dominant operators from using pricing advantages to stifle smaller players
- Consumer protection: Reducing wholesale imbalances that could translate into higher retail tariffs
- Infrastructure investment: Encouraging operators to invest by ensuring recoverable, cost-reflective pricing
- Digital economy growth: Supporting affordability, digital financial services, and broader connectivity
Mohammed assured stakeholders that the commission would make its methodology, assumptions, and cost model parameters available throughout the process to ensure transparency.
Stakeholder Engagement Central to Final Determination
Closing the forum, the NCC’s Director of Public Affairs, Mrs. Nnenna Ukoha, described the MTR review as one of the commission’s most consequential public engagements due to its impact across the entire telecommunications value chain.
She commended stakeholders for their active participation in the review process. She also encouraged continued submissions of data, insights, and perspectives to support a balanced and forward-looking outcome.
“The complexity of MTR determination underscores the need for sustained stakeholder collaboration as we work toward a resilient, inclusive, and future-ready telecommunications sector,” Ukoha said.
