The Nigerian market is looking rather tough for telecommunication giant, MTN Group, after years of dominance, and on Wednesday, its CEO, Sifiso Dabengwa gave a bearish outlook for Nigeria when he presented the company’s results to reporters and analysts.
Speaking in Johannesburg, Dabengwa conceded that in Nigeria, Etisalat has a superior network quality to MTN when it comes to data speed and quality.
“The key issue really for us has been to improve the data quality and speeds. Clearly, Etisalat’s network, from a data point view, has been better than ours,” he said frankly.
He disclosed that some high end users have migrated from MTN to Etisalat in recent times due to poor network quality in Abuja and Lagos.
MTN reported a 10 percent decline in first-half earnings while its subscribers base rose by just 3 per cent in the first half of the year to 231 million.
Dabengwa said that a bulk of its 19 billion rand ($1.5 billion) spending package for the rest of this year will be used to expand high-speed networks in Nigeria and South Africa, where rivals such as Vodacom Group and Cell C have slashed voice tariffs to gain market share.
However, spending on a network in Nigeria, Africa’s most populous country, is unlikely to deliver a strong enough performance to offset the impact of a sharp economic slowdown which is curbing consumers’ disposable income.
“We expect the balance of the year to remain challenging for MTN Nigeria,” the company said in its results announcement.