Without Tariff Hike, Our Survival is at Stake, MTN CEO Warns

Karl Toriola, the CEO of MTN Nigeria, has issued a strong warning that the country’s telecommunications sector is in serious trouble and could face collapse if prices are not increased.

On Tuesday, at a Telecom Investment Forum in Lagos, Toriola pointed out the major challenges facing telecommunications companies in Nigeria.

Despite the growth the sector has seen over the last 20 years, he said rising costs and outdated pricing are now putting the industry at risk.

Toriola stressed that raising prices is now a must, calling it an “absolute necessity” to save the sector from falling apart. The CEO of MTN described the situation as so critical that the industry is like a patient in an “intensive care unit.”

When talking about the future of investment in the telecom sector, Toriola explained that the expected financial returns have become so low that they threaten the industry’s survival.

“No one will invest $1 if they expect to get only 60 cents back,” he explained, highlighting the dire financial state of the industry.

He warned that without necessary changes, new investments in the sector could stop altogether. He emphasized that keeping prices the same for 11 years is impossible in the current environment, where inflation and currency devaluation are major issues.

“You can’t expect an industry to maintain the same prices under these conditions,” Toriola said.

He also mentioned the increasing costs the telecom sector is facing, including the cost of capital and maintaining infrastructure like base stations and diesel generators.

“Without adjusting prices, the industry won’t be able to function properly or attract new investments,” he cautioned.1

While Toriola noted some progress in talks with regulators, he made it clear that the problems are still severe.

He called for quick and decisive action to prevent the industry’s collapse, saying that stakeholders are starting to understand the severity of the situation and are considering necessary steps, such as price increases and other measures.

“Quick and strong action is needed to save this industry,” Toriola concluded, stressing that time is running out to address these critical issues.