Telecommunication services consumers in the country may enjoy lower call rates from 2011 going by the tariff war that started among operators in 2010.
The crash in call rates started barely two weeks after Bharti Airtel acquired former Zain and started re-branding the company.
Bharti Airtel, which took over mobile telephone operations in 15 African countries in a deal that has made it the world's fifth-biggest mobile company with 180 million customers in 18 countries, has never hidden its plan to reduce tariffs in Nigeria.
Its chairman, Sunil Bharti Mittal, flaunted his company's low-tariff strategy while unveiling the brand identity in Nigeria. He said that it will give other network operators a good fight to have a good share of Nigeria's telecoms market.
Just days after Mr Mittal's statement, Airtel crashed its call rates to as low as N9 per minute from the industry average rates of N35 to N42 per minute.
This price reduction strategy jolted the industry and elicited responses from other network operators.
Other operators have now initiated a number of value added propositions and tariff packages to sustain revenue and retain subscribers.
Etisalat had earlier slashed its call rates by 50 per cent from a peak of 50k per second to 25k in its Easylife offer which has a daily access charge of N20.
Steve Evans, chief operating officer of Etisalat Nigeria, said that the company was unperturbed by Airtel's low- tariff strategy.
Mr Evans said that his network was one of the best in Nigeria and its tariffs were competitive.
MTN Nigeria has also introduced new tariff packages: MTN Funlink, Smartlink, Prolink, Bizlink and Happilink that allow customers to enjoy more air time at highly reduced costs to customers across its market segments.
Globacom has similarly inaugurated a package in Port Harcourt, Rivers state that enables telecoms subscribers to pay 25k per second for all calls to any network in the country without any rental or access fee.
Price war is part of the competition
Lanre Ajayi, President Nigerian Internet Group (NIG), said he sees no link between tariff reduction and halting investment, adding that Airtel's action would stimulate expansion of networks rather than diminish investments in the sector.
"On the other hand, it will call for further investment because when you reduce tariffs, you are asking more people to make more calls and when that happens, traffic increases.
"When traffic increases, it requires expanded network. It's just logical that when an operator is planning to attract more traffic to its network, it's planning to expand its network," Mr Ajayi said.
He said price war is part of competition and "when you are going to war, you use all tools at your disposal and price war just happens to be one of the weapons in competition."
"I think we should be paying less than what countries like Benin Republic and Ghana are paying because this is a large market. It should not be too surprising.
"The tariffs we are seeing now, I am not sure we have seen the last. I believe it will soon go down further.
"I believe other operators will reduce their prices if they want to remain in business, otherwise, who will want to pay higher tariffs when there is an alternative of a lower one.
"Others will be forced to drop their tariffs and that's what competition does," the NIG boss said.
Source:234next
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