Nigeria: Tariff cuts by Airtel affect airtime traders’ turnover

Telecoms

One person’s gain is another person’s loss. The lively price war amongst mobile operators in Nigeria has proved good news for consumers but is threatening to put a number of airtime resellers and call centre operators out of business.

Checks by The Leadership’s reporter showed that many of the call centre operators and resellers have found their business has been badly affected, especially when Airtel lowered its tariffs by half allowing its customers to make calls across networks for only 20 kobo per second or N12 naira per minute.

With the current trend, the traders lament that their sales had dropped by over 50 per cent, while saying that if the situation is not checked, most of them would soon close shop owing to losses.

Michael Oyetade, a telephone operator in Ikeja told The Leadership that unlike in the past when subscribers preferred to come to them in order to make long calls, the reverse was the case throughout the holiday periods. He said it has even been more frustrating that the low tariffs have significantly extended the time consumers take before they are back to the shop for a top-up, thereby cutting trading volumes by large margins.

Another dealer Bola said his usual customers are just not "topping up" as frequently as they used to, because any amount of airtime they buy now lasts longer than it used to. Ordinarily, mobile phone operators may have expected consumers to make longer calls or increase their spending on airtime after the tariff cuts, but, on the contrary, dealers say there are no signs of increased spending.

A subscriber with Airtel, Johnson Babatunde told The Leadership’s reporter that he had the best Christmas and New Year holidays so far as the tariff slash afforded him the opportunity of calling as many more people. While subscribers of Airtel and Etisalat could now make calls for N12 and N15 per minute, business centers still charge their customers N20 per minute.

Clearly, subscribers have never had it so good, but they would do well to spare a thought for struggling airtime traders. Meanwhile, there are whispers that the reduction in the tariff might not last long. Messages being sent to subscribers of Airtel showed that the reduction might end at the end of this month.

In another development, industry experts say that people should not forget the fact that the rate slash promo by Airtel was just a ploy to win back many of its subscribers who seem to have lost confidence in the networks especially on account of its continued name changing.