Suara Sherif
Nigeria’s telecommunications industry is locked in an expensive war against unreliable electricity, relentless fibre cuts, vandalism and security threats, a battle that is driving up operating costs and squeezing profitability even as demand for connectivity soars.
The sector, valued at an estimated N75 trillion, has become the backbone of daily life, enabling banking, commerce, education and healthcare for millions of Nigerians.
Yet behind the digital transformation lies a harsh operating environment that makes running a network in Nigeria far more costly than in developed markets.
Beyond the standard investments in spectrum licences, towers and fibre infrastructure, operators must contend with erratic grid power, heavy diesel consumption, battery replacements, repeated fibre repairs and the constant relocation of infrastructure damaged by road construction or deliberate sabotage.
MTN Nigeria Chief Executive Officer, Karl Toriola, recently laid bare the scale of the challenge.
Speaking to 2026 MTN MIP fellows in Lagos, he contrasted the cost of powering a base station in Europe with the reality operators face locally.
“In Europe, electricity for a site could be around $200 or $500 per month,” Toriola said.
“In Nigeria, you first have to install one or two generators. That’s capital expenditure. A generator lasts four to five years. Then you must fuel those sites every month. You also need battery backup because outages are frequent and you cannot afford for the site to go down every time.”
His comments capture a structural disadvantage that defines the industry.
While carriers in markets with dependable electricity simply plug into the national grid, Nigerian operators have been forced to build alternative power systems around nearly every site.
That translates into additional capital spending on generators and batteries, plus ongoing operational costs for diesel, maintenance and replacements.
The burden does not end with power. Fibre cuts, whether from construction activity, theft or vandalism, force operators to spend heavily on repairs and redundant routes to keep services running.
Security expenses have also climbed as companies deploy guards, surveillance systems and other protective measures across vulnerable installations.
Industry insiders say these costs eat deeply into margins and slow the pace of network expansion, particularly in rural and underserved areas where returns are already thin.
The situation has prompted repeated appeals for government intervention, including tax relief, right-of-way reforms and stronger protection for critical telecom assets.
Despite these headwinds, the demand for data and digital services continues to surge, pushing operators to invest more in network capacity even as their cost base swells.
The result is a delicate balancing act between maintaining service quality and protecting shareholder returns.
Analysts warn that without meaningful policy changes, the high cost of operations could eventually lead to higher tariffs for consumers or slower investment in next-generation technologies.
The telecom industry has long argued that current pricing structures do not reflect the true cost of delivering services in Nigeria’s difficult operating climate.
For now, operators say they remain committed to expanding coverage and improving reliability. But the economics are becoming harder to sustain.
The widening gap between what it costs to run a network in Nigeria and what operators can reasonably charge raises serious questions about the long-term health of a sector the entire economy depends on.
