Discover why Nigeria’s internet costs remain among the highest in Africa. Explore the key factors driving expensive data prices and possible solutions for cheaper internet access. Thus, we discuss factors like Limited Infrastructure and Government Policies and Taxes. As well as Monopoly and Limited Competition and High Cost of Internet Equipment.

Nigeria is a leading player in Africa’s digital transformation, boasting a fast-growing tech ecosystem, a booming startup culture, and increasing internet penetration. However, Nigeria’s internet costs remain among the highest on the continent.

In a country where millions rely on the internet for work, education, and business, high data prices make digital access difficult for many Nigerians. While some countries in Africa enjoy cheaper and more stable internet, Nigeria continues to struggle with costly and often unreliable services.

But why is this happening? With so many telecom companies, fiber-optic networks, and undersea cables in the country, shouldn’t internet be more affordable? The reality is that Nigeria’s internet costs are influenced by several factors, from poor infrastructure to government policies and market monopolies.

In this article, we’ll explore the major reasons behind Nigeria’s internet costs, breaking down the hidden forces keeping prices high.

Limited Infrastructure Is Driving Up Nigeria’s Internet Costs

One of the biggest reasons Nigeria’s internet costs remain so high is the country’s weak digital infrastructure. A country’s internet affordability largely depends on how well its broadband infrastructure is developed, and Nigeria is still lagging in this area.

While mobile network coverage has expanded in the last decade, the country still faces significant challenges when it comes to fiber-optic deployment, data centers, and last-mile connectivity. The high cost of maintaining telecom infrastructure in Nigeria contributes to expensive internet services.

1. Fiber-optic Network Challenges

Fiber-optic cables are the backbone of modern broadband internet, offering high-speed and reliable connectivity. While Nigeria has access to multiple undersea fiber-optic cables—including the West Africa Cable System (WACS), GLO-1, and MainOne—the challenge is bringing this internet inland to homes and businesses.

The lack of an extensive fiber-optic network means that internet distribution across the country is expensive. Most of Nigeria’s broadband infrastructure is concentrated in cities like Lagos, Abuja, and Port Harcourt, leaving rural areas with limited options.

Extending fiber-optic networks to other parts of the country is costly due to:

Poor road networks: Many parts of Nigeria lack good road infrastructure, making it expensive and difficult to lay fiber-optic cables.
Security issues: Vandalism, theft, and insurgency in some regions prevent telecom companies from investing in network expansion.
Right-of-Way (RoW) charges: Some state governments charge high fees for ISPs to install fiber cables along highways and streets.

Since ISPs face high costs when expanding fiber-optic networks, they pass these expenses to consumers—leading to higher Nigeria’s internet costs.

2. Unreliable Electricity Supply Increases Costs

Internet infrastructure, including data centers and telecom towers, requires a stable power supply. Unfortunately, Nigeria’s power sector is highly unreliable, forcing ISPs to rely on diesel-powered generators to keep their systems running.

Diesel costs have skyrocketed due to currency fluctuations and global oil prices, making it even more expensive to maintain internet services. Since ISPs need constant power to prevent service disruptions, they include these expenses in their pricing models, further raising Nigeria’s internet costs.

3. Limited Last-Mile Connectivity

Even when fiber-optic cables reach major cities, the challenge of “last-mile connectivity” remains. This refers to delivering internet from a central access point (like a telecom mast) to homes and businesses.

Many areas, especially rural communities, lack the infrastructure to extend fiber connections.
ISPs often charge high installation fees to cover the cost of setting up home broadband.
In some cases, consumers have to buy expensive equipment like routers and modems to access fast internet.

Because of these infrastructure challenges, Nigeria’s internet costs remain some of the highest in Africa, making digital inclusion difficult for many citizens.

Government Policies and Taxes Are Making Nigeria’s Internet Costs Worse

The Nigerian government plays a key role in shaping internet accessibility through policies, regulations, and taxation. Unfortunately, rather than promoting affordability, some government actions have contributed to Nigeria’s internet costs remaining high.

1. High Right-of-Way (RoW) Charges

One of the biggest financial burdens for ISPs in Nigeria is the Right-of-Way (RoW) fees imposed by state governments. These are charges ISPs must pay to lay fiber-optic cables along roads and highways.

In some states, RoW fees are as high as ₦6,000 per meter of cable, significantly increasing broadband deployment costs.
In contrast, states like Ekiti and Kaduna have reduced these fees to ₦145 per meter to encourage network expansion.

Because RoW charges vary across states, some telecom providers are discouraged from expanding to certain regions, leading to uneven internet access and Nigeria’s internet costs staying high.

2. Multiple Taxation on Telecom Companies

The telecom sector in Nigeria is heavily taxed, with ISPs paying multiple fees to different government agencies. These include:

Value-Added Tax (VAT): A 7.5% tax on internet services.
Annual licensing fees: ISPs must renew operating licenses, which adds to their expenses.
Import duties: High tariffs on imported telecom equipment make infrastructure deployment expensive.

These taxes make it difficult for ISPs to lower prices, even when internet demand is growing. Instead, they pass these costs to consumers, further worsening Nigeria’s internet costs.

3. Slow Regulatory Approvals

Even when ISPs want to expand their services, they often face delays due to slow approval processes from government agencies. Whether it’s getting a license for new broadband infrastructure or obtaining clearance for fiber deployment, bureaucratic red tape slows down progress.

The longer it takes for companies to roll out new internet services, the more expensive it becomes. As a result, Nigeria’s internet costs remain high because service providers must recover these operational delays through higher prices.

4. No Clear Broadband Price Regulation

Unlike some countries where governments set maximum broadband prices, Nigeria lacks a strict pricing regulation policy for internet services. ISPs have the freedom to set prices, leading to significant variations in internet costs across different providers.

Until stronger policies are put in place to encourage competition and fair pricing, Nigeria’s internet costs are likely to remain high, making digital access a luxury rather than a necessity.

Monopoly and Limited Competition Are Keeping Nigeria’s Internet Costs High

For prices to fall, there must be competition in the market. But Nigeria’s internet industry is dominated by a few big players, so prices won’t come down.

1. Big Telecom Companies

Four major telecom operators—MTN, Airtel, Glo, and 9mobile—control a big chunk of the internet market in Nigeria. They offer both mobile data and broadband services, leaving little room for smaller ISPs to compete.

Since they control the market, they have less incentive to reduce prices. They focus on maximizing profits, keeping Nigeria’s internet costs high.

2. Challenges for Smaller ISPs

Smaller ISPs that try to enter the market face:

High licensing fees that make it hard to operate.
Limited access to fiber-optic networks controlled by bigger telecom companies.
Financial constraints that prevent them from scaling their services.

Without competition, big telecom companies continue to set internet prices and prices won’t fall naturally.

High Cost of Internet Equipment Is Adding to Nigeria’s Internet Costs

One of the less talked about reasons for Nigeria’s internet costs is the high cost of acquiring and maintaining internet infrastructure.

1. Imported Telecom Equipment

Nigeria doesn’t manufacture most of the equipment needed for internet connectivity, so ISPs import:

Fiber-optic cables
Routers, modems and switches
Satellite and broadband equipment
Data center hardware

Since these products are bought in foreign currencies (mostly USD and EUR), fluctuations in Nigeria’s exchange rate makes them even more expensive.

For example, when Naira depreciates against the dollar, ISPs must spend more to acquire equipment and these costs are passed on to the consumer, keeping Nigeria’s internet costs high.

2. Import Tariffs and Duties

Besides the base cost of the equipment, the Nigerian government imposes import tariffs and duties on telecommunications infrastructure. These taxes increase operational expenses for ISPs and discourage investment in broadband expansion.

Instead of encouraging local ISPs to expand their reach, these costs force them to keep internet prices high to remain profitable. Until Nigeria reduces import duties on telecom equipment or starts producing some of these materials locally, Nigeria’s internet costs will remain high.

How Exchange Rate Is Affecting Nigeria’s Internet Costs

The Nigerian Naira exchange rate has a huge impact on Nigeria’s internet costs. Most internet infrastructure and bandwidth are bought in USD, so whenever the Naira depreciates, service providers must pay more for the same resources.

For example:

An ISP used to buy international bandwidth at ₦450 per USD and the exchange rate suddenly jumps to ₦900 per USD, their operational costs doubles overnight.
These costs is then reflected in data plan pricing and end users pay high for internet.

Additionally, Nigeria’s telecom companies purchase international bandwidth from foreign providers, such as those in Europe and the United States. This means every increase in exchange rates directly affects how much Nigerians pay for internet services.

Until the Nigerian economy stabilizes and the Naira strengthens, Nigeria’s internet costs will continue to be impacted by fluctuating exchange rates.

Consequences of having Limited Access to Affordable Broadband

While mobile internet is widespread in Nigeria, broadband penetration is still low. Broadband internet is typically cheaper, faster, and more reliable than mobile data, but the lack of widespread broadband infrastructure contributes to Nigeria’s internet costs.

1. Low Broadband Penetration

According to the Nigerian Communications Commission (NCC), broadband penetration in Nigeria remains below 50%. This is due to:

Expensive fiber-optic deployment: Many homes do not have fiber broadband because laying cables is costly.
High installation fees: Many broadband providers charge significant upfront costs for setup.
Lack of investment in rural broadband: Most broadband infrastructure is concentrated in urban areas, while rural regions remain underserved.

With limited broadband options, many Nigerians depend on mobile data, which is generally more expensive per gigabyte than fixed broadband.

2. Expensive Home Internet Plans

Even in areas where broadband is available, prices remain high. Some major broadband providers in Nigeria include:

IPNX: Offers high-speed fiber, but with expensive plans.
Spectranet: Popular for unlimited plans, but speeds vary.
Smile Communications: Provides 4G LTE services, but coverage is limited.

A typical fiber broadband plan in Nigeria costs between ₦15,000 – ₦30,000 per month, which is expensive compared to the average income level.

Until broadband access becomes widespread and affordable, Nigeria’s internet costs will remain high for most people.

Security Issues is a Factor Affecting Nigeria’s Internet Costs

Another overlooked factor affecting Nigeria’s internet costs is security concerns.

1. Vandalism and Theft of Internet Infrastructure

Nigeria’s telecom companies frequently deal with:

Fiber-optic cable vandalism: Criminals cut or steal cables, disrupting internet services.
Telecom tower destruction: In some parts of the country, network towers are attacked or damaged.
Battery and generator theft: Power backups at telecom sites are often stolen, making operations more expensive.

Each time an ISP has to repair or replace damaged infrastructure, they incur additional costs—costs that are eventually passed down to consumers.

2. Cybersecurity Threats

Cybercrime is a growing issue in Nigeria, with hackers targeting both businesses and ISPs. To protect their networks, ISPs must invest heavily in firewalls, security protocols, and IT personnel, all of which increase operational expenses.

The more ISPs spend on security, the higher Nigeria’s internet costs become for the average user.

Data Costs and Prices in Nigeria Across All Networks

Let’s break down the cost of mobile internet across Nigeria’s major telecom providers:

1. MTN Data Plans

1GB for ₦350 (24 hours)
2GB for ₦500 (2 days)
10GB for ₦3,000 (30 days)
20GB for ₦5,000 (30 days)

MTN generally offers reliable coverage but is often seen as more expensive than other networks.

2. Airtel Data Plans

2GB for ₦500 (2 days)
5GB for ₦1,500 (7 days)
8GB for ₦3,000 (30 days)
35GB for ₦10,000 (30 days)

Airtel is known for competitive pricing, especially for medium-sized data plans.

3. Glo Data Plans

1GB for ₦300 (1 day)
3.5GB for ₦500 (2 days)
15GB for ₦2,000 (7 days)
40GB for ₦5,000 (30 days)

Glo offers some of the cheapest data plans in Nigeria but often struggles with network speed and coverage.

4. 9mobile Data Plans

1GB for ₦500 (1 day)
7GB for ₦2,000 (7 days)
15GB for ₦5,000 (30 days)
75GB for ₦20,000 (30 days)

9mobile is known for fast internet speeds, but its data plans tend to be more expensive.

How Can Nigeria Reduce Its Internet Costs?

To make Nigeria’s internet costs more affordable, several steps must be taken:

Expand fiber-optic networks: The government should invest in fiber infrastructure, especially in rural areas.
Reduce import tariffs on telecom equipment: Cutting taxes on broadband equipment will lower ISP costs.
Encourage competition among ISPs: More competitors mean better prices for consumers.
Stabilize the Naira: A stronger currency will reduce the cost of imported bandwidth and equipment.
Improve security for telecom infrastructure: Protecting fiber-optic cables and telecom sites will prevent price hikes.

If these issues are addressed, Nigeria’s internet costs could become more affordable, allowing more people to benefit from digital opportunities.

Conclusion

While Nigeria has made progress in digital connectivity, Nigeria’s internet costs remain too high for many citizens. From infrastructure challenges to government policies, many factors influence data pricing in the country.

The solution lies in stronger competition, better regulations, and more investment in broadband expansion. Until then, Nigerians will continue to pay some of the highest internet costs in Africa.

What are your thoughts on Nigeria’s internet costs? Do you think prices will drop soon? Let’s discuss!

Official Source: Nigerian Communications Commission (NCC)

Why Nigeria’s Internet Costs Are Still Some of the Highest in Africa