Internet Speed in Need of a Boost

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Friday, January 28, 2022 / 09:20 AM / by FBNQuest Research / Header Image Credit: ZD Net


Our chart below is drawn from the Nigerian Communications Commission's ( NCC) most recent data for December 2021. They show another modest rise of 1.0% m/m and 1.1% m/m in active mobile lines and internet subscriptions to 195 million and 141.6 million respectively, for December. Active lines have steadily increased since July '21, following lifting of the regulator's ban on SIM card sales and activation. The number of active lines translate to teledensity and internet penetration rates of c.97.6%, and 70.8% based on an assumed population of 200 million.


In line with the modest growth in active mobile lines and internet subscriptions, we see that broadband subscriptions also ticked up by 2% m/m to c.78 million, implying a broadband penetration rate of almost 40%.


Even before the regulatory-induced fall last year, the increase in active mobile lines and internet subscriptions had begun to slow as the sector approached maturity, with teledensity and mobile penetration rates of c.104% and 77.2%, respectively, as of November '2021.


However, despite the large base of active mobile lines and internet subscribers (which are mostly mobile), the quality of internet connection is still very poor, when measured by data speed.


According to the Digital Quality of Life Index, a global body that ranks countries based on digital wellbeing, Nigeria ranked 82nd overall out of 110 countries ranked on digital quality, and 105 in terms of broadband speed.


On a more positive note, Nigeria was ranked 43rd in the world for mobile data pricing in 2021, with an average price of USD0.88 per 1GB of data, compared to a global average of USD4.07, based on data from 230 countries.


While GSM networks' expansion of 4G networks has helped boost data speeds, much more must be done to raise Nigeria's average internet data download speed from c.18.92Mbps to the median global average of 29.55Mbps, according to Speedtest Global index statistics (71.26Mbps mean average).


Following the successful auction of 5G licences last month, the eventual rollout of 5G networks would help improve data speeds. However, we anticipate a gradual rollout. Given network providers' additional infrastructure expenditures, data plans may initially be more expensive before tapering down.



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