NCC begins review of mobile termination rates after eight years

The Nigerian Communications Commission (NCC) has commenced a comprehensive review of Mobile Termination Rates (MTR), eight years after the current rates were introduced in 2018.

The Head of Competition and Tariff at the NCC, Mrs Omotayo Mohammed, disclosed this on Tuesday in Lagos while presenting a consultancy document on the review process.

Mobile Termination Rates (MTRs) are the wholesale per-minute charges that one telecoms operator pays to another to complete a call on a competitor’s network.

They are the fees charged by mobile operators to connect a phone call originating from a different network.

In Nigeria, the Nigerian Communications Commission (NCC) sets these regulated rates to manage competition and ensure fair pricing across networks.

Mohammed said the review became necessary because the existing rates no longer reflected prevailing economic and operational realities in the telecommunications industry.

“The foundation of wholesale interconnection affects every stakeholder in this room.

“Misaligned termination rates can enable dominant operators to foreclose smaller competitors, deter infrastructure investment and ultimately burden consumers through inflated retail prices,” she said.

The NCC official explained that the current MTR stood at N3.90 per minute for generic operators and N4.70 per minute for new entrants, rates that had remained unchanged since 2018.

According to her, significant changes in the economy, including naira depreciation, rising inflation and increasing energy costs, have altered operators’ cost structures over the years.

Mohammed noted that advancements in technology, particularly the deployment of 5G networks, Artificial Intelligence (AI)-driven services and Internet of Things (IoT) applications, had also changed network usage patterns beyond what was envisaged in the 2018 cost model.

She added that Over-the-Top (OTT) platforms such as WhatsApp and Telegram were increasingly handling voice and messaging traffic, thereby reducing reliance on traditional interconnection services.

Mohammed said the commission had engaged KPMG to undertake the consultancy and stakeholder engagement process, expected to last four months.

According to her, the study will address issues relating to Unstructured Supplementary Service Data (USSD) services and Application-to-Person (A2P) Short Message Service (SMS), both of which have become increasingly important in the digital economy.

She said the review was being conducted in line with Sections 4, 96, 97 and 108 of the Nigerian Communications Act 2003, which mandated the commission to promote investment, protect consumers and ensure fair competition.

Mohammed said the study would provide a cost-reflective MTR framework across different technology generations, operator categories and clearing house arrangements.

She added that it would also review International Termination Rates (ITR) to address grey-route traffic concerns, establish a pricing framework for Mobile Virtual Network Operators (MVNOs), and assess the current asymmetric rate structure between large and new entrant operators.

“The consultancy adopts an evidence-based and consultative approach. Stakeholders will have opportunities to submit their views and validate assumptions before any determination is made,” she said.

Mohammed said the review was expected to support retail affordability, improve access to digital financial services and enable operators to recover costs in line with current capital and operational expenditure realities.

She said transparent and cost-reflective rates would encourage infrastructure investment and enhance investor confidence in Nigeria’s digital economy.

Mohammed assured stakeholders that the NCC would make its methodology, key assumptions and cost model parameters available for review throughout the process to ensure transparency.

In her closing remarks, the Director of Public Affairs at the NCC, Mrs Nnenna Ukoha, described the forum as one of the commission’s most important public-facing engagements because of its impact on the entire telecommunications value chain.

Ukoha said Mobile Termination Rates remained central to pricing structures, competition, service quality and consumer experience, making broad stakeholder participation essential to the determination process.

“We are particularly encouraged by the rapt attention, intellectual rigour and keen interest demonstrated by participants throughout today’s session.

“This active engagement reflects not only the relevance of the issues discussed but also a shared commitment to the sustainable growth and development of Nigeria’s telecommunications sector,” she said.

According to her, the presentations and discussions highlight both the complexities and opportunities in the MTR determination process and underscored the need for continuous stakeholder engagement.

She reiterated that the window for consultation remained open and encouraged stakeholders to submit additional inputs, data and perspepctives to support a balanced, forward-looking and sustainable outcome for the industry.

Ukoha assured stakeholders that the commission would continue to embrace collaboration and incorporate stakeholder feedback into its regulatory frameworks, while working towards a resilient, inclusive and future-ready telecommunications sector.