MTN, Airtel agree to share network infrastructure in Nigeria and Uganda

Telecommunications services providers MTN Group and Airtel Africa have agreed to share mobile phone network infrastructure in Uganda and Nigeria. According to a statement jointly released today, the arrangement will enable both companies to save business costs and increase service coverage.

According to the CEOs of both companies, sharing infrastructure allows operators to extend their network coverage to especially rural or less densely populated areas where it might not be economically viable to build separate networks.

“There are opportunities within regulatory frameworks for sharing resources to drive higher (operational) efficiencies and improve returns,” MTN Group CEO, Ralph Mupita, said in a statement. Similarly, Airtel Africa’s Sunil Taldar said the agreement would avoid duplication of expensive infrastructure.

“This engagement does not preclude the parties from collaborating with other operators in any respective market,” the statement said.

According to it, MTN and Airtel Africa will explore various opportunities in other markets, including Congo-Brazzaville, Rwanda and Zambia, following the conclusion of agreements in Uganda and Nigeria.

Among the deals under consideration are radio access network sharing, the largest portion of the cost in network deployment and operation; commercial and technical agreements for fibre infrastructure sharing; and, if necessary, the construction of fibre networks.

This announcement comes four weeks after Airtel Nigeria secured approval from Nigeria’s highest executive decision-making body, the Federal Executive Council (FEC), to construct 7,000 new telecom towers in rural areas. According to the government, this investment will bridge the nation’s connectivity gap.

It is unclear how this new agreement will influence the intended investment.

MTN and Airtel’s struggle to survive challenging times

Both companies have seen sustained demand for digital and financial services in markets where building and maintaining networks is expensive, especially for fast 5G connections. Conversely, both companies have had to deal with outcries from subscribers and regulators over recent data and call tariff price adjustments.

Last month, MTN reversed a contentious 200% tariff hike in Nigeria following significant backlash and a direct threat of action from the Nigerian Labour Congress (NLC).

Recall that MTN announced a N400.44bn loss after tax for the year ended December 31, 2024. The loss represents a 123 per cent increase from the N137.02bn loss recorded the previous year.

The loss after tax report by MTN’s Nigerian subsidiary comes a day after the parent company reported a significant decline in its full-year headline earnings per share (HEPS), which will be published in March. 

The Group blamed the decline on the impact of Nigeria’s foreign exchange regime on its profit, despite a good operational performance. Its HEPS for the year ending December 31, 2024, will decline by 59% to 79% while earnings per share rose by more than 100%.

Similarly, Airtel’s mobile services revenue in Nigeria declined to $738 million for the year ending December 31, 2024. This represents a 40.34% decrease from the $1.2 billion recorded in the previous year. 

The annual financial report dated January 2025 detailed the breakdown of the mobile service saw voice revenue slip by 46.34% to $315 million and data revenue drop by $344 million in December 2024. This represents a 36.28% shift from the $539 million recorded in December 2023. 

Other revenues, such as inter-segment revenue, also witnessed the same negative trend, falling from $112 million to $79 million, though mobile money revenue increased from $1 million to $3 million. 

The result comes after Airtel Nigeria witnessed a 3.17% growth in total subscribers from 50.5 million to 52.1 million. The same trend was applied to the customer database, which surged from 26.1 million to 28.2 million.

At the unveiling of the numbers, Airtel Africa’s Chief Executive Officer, Sunil Taldar, restated the company’s commitment to investing for the future by expanding its distribution and network to ensure significant growth.