A review of the Nigerian telecom industry over 5 years: the good, the great and the challenges

The Nigerian telecom industry, a cornerstone of the nation’s economic framework, has undergone quite a storied journey from 2020 to 2025. This period has been characterized by noticeable challenges, impressive achievements, and a clear trajectory toward a digitally inclusive future. 

The sector currently stands at a pivotal juncture, reflecting resilience in the face of regulatory shifts, global economic turbulence, and technological evolution.

This article provides an in-depth analysis of the industry’s performance over the past five years, drawing on industry reports, statistical insights from the Nigerian Communications Commission (NCC), and emerging trends to assess its challenges, successes, and prospects beyond 2025.

Challenges faced by Nigeria’s telecom industry over 5 years

The Nigerian telecom sector faced significant hurdles between 2020 and 2025 that tested its operational resilience and financial stability.

Apart from Covid-19, one of the most impactful challenges the sector faced was the mandatory linking of SIM cards to the National Identity Number (NIN), introduced to bolster national security. 

While well-intentioned, this policy triggered a dramatic decline in the subscriber base, as noted in a Leadership newspaper report.

By September 2024, 64.3 million lines were disconnected, slashing the total subscriber count by 30% from 219 million to 154.6 million. Major operators bore the brunt, with one losing 43 million subscribers and another seeing its active lines plummet to just 3.6 million. This contraction strained revenue streams and underscored the delicate balance between security imperatives and industry growth.

Another is broadband penetration, a key target of the National Broadband Plan (2020-2025), which also fell short of expectations. The plan aimed for 70% penetration by 2025, yet by March 2024, the figure stood at 43.71%, dipping further to 41.56% by September. 

Affordability remained a critical barrier, with smartphone prices ranging from N120,000 to N2 million, out of reach for many in a country where 88.4 million people live in extreme poverty. With smartphone ownership estimated at 11.8% to 18.9%, digital exclusion persisted, particularly in rural areas where only 26% of residents owned smartphones compared to 59% in urban centers.

Furthermore, infrastructure gaps compounded these issues, leaving about 120 million Nigerians disconnected from the digital economy. Only 29% (58 million) actively used mobile internet, while 27 million lacked telecom services, and 301 local government areas remained without internet access. 

Economic pressures further strained the industry, with the naira’s depreciation from N471 to over N1,600 by April 2025 driving financial losses for major operators. MTN Nigeria and Airtel Africa reported combined losses of N1.29 trillion, exacerbated by a 90% surge in diesel prices that inflated operational costs to N57.65 billion monthly.

Although foreign direct investment (FDI) surged 537.26% to $304.99 million in the first half of 2024, the average revenue per user (ARPU) dropped by 58% in dollar terms, reflecting a decade of static tariffs.

Regulatory challenges, such as inconsistent Right-of-Way (RoW) fees, added complexity. While seven states waived these fees, alternative levies in some regions offset potential savings. The NCC has noted that standardizing RoW fees could cut costs by 15%, yet delays in spectrum auctions, initially disrupted by Covid-19, further hampered investment momentum.

These challenges collectively painted a picture of an industry under pressure, yet poised for recovery.

Nigeria telecom industry’s achievements in 5 years

Despite these obstacles, the Nigerian telecom sector recorded remarkable gains from 2020 to 2025, showcasing its capacity for growth and adaptation. The market size reached $9.52 billion in 2025.

According to the NCC, this growth was driven by urban expansion, rising mobile phone adoption, and the integration of advanced technologies like the Internet of Things (IoT). This growth trajectory aligns with projections of reaching $11.97 billion by 2030 at a compound annual growth rate (CAGR) of 4.70%.

Indeed, some technology advancements were a standout achievement.

By 2022, 44.5% of broadband subscriptions were on 3G and 4G networks, with the NCC targeting a shift to 70% by 2025. The introduction of 5G marked a significant leap, with Mafab Communication launching services in Abuja in January 2023, followed by MTN Nigeria and Airtel Nigeria extending 5G to eight states, including Lagos, Abuja, and Port Harcourt.

The NCC’s regulatory push to phase out 2G/3G by the end of 2025 has set the stage for 5G dominance by 2029, positioning Nigeria among Africa’s telecom frontrunners.

Also, subscriber numbers rebounded impressively by January 2025, reaching 169.3 million active subscriptions, up from 154.9 million in September 2024, thanks to gains by MTN and Airtel.

This recovery followed a turbulent 2024, reflecting the industry’s ability to adapt post-NIN verification. 

Infrastructure development also witnessed upticks, with Tizeti expanding its 4G LTE network to ten states by February 2023, and Globacom rolling out LTE Advanced sites nationwide in 2023 to meet rising data demands. These efforts, supported by the NCC’s oversight and initiatives like the National Broadband Plan, underscore a commitment to bridging connectivity gaps.

Recent developments in 2025 indicate a renewed push by telecom giants like MTN, Airtel, and Glo to overhaul infrastructure amid tariff hikes approved by the NCC.

These multi-million-dollar investments, when completed, will address long-standing connectivity issues, offering hope to frustrated customers and signaling a turning point for service quality.

Looking forward: Prospects and opportunities 

Beyond 2025, the Nigerian telecom industry is poised for sustained growth and innovation. Market projections suggest a rise to $17.13 billion by 2034, with a CAGR of 5.20%, fueled by demand for mobile services, fixed internet, and enterprise solutions.

The accelerated rollout of 5G is expected to drive this expansion, enabling faster speeds and supporting smart city initiatives and IoT applications. By 2029, 5G is projected to dominate mobile connections, reinforcing Nigeria’s leadership in Africa’s telecom landscape.

Broadband penetration remains a priority, with the NCC aiming to connect 90% of the population through expanded infrastructure and affordable devices. Addressing rural-urban disparities and reducing digital exclusion will be critical, requiring targeted investments and public-private partnerships.

Economically, the sector’s contribution to GDP, already significant, is expected to grow, potentially reaching $60 billion by 2030, though current trends suggest this estimate may evolve.

Notably, competition among operators will spur innovation, with new entrants and established players like MTN, Airtel, and Glo investing in advanced technologies. T

he NCC’s role in fostering a supportive regulatory environment will also be pivotal, ensuring that initiatives like spectrum allocation and infrastructure funding align with national goals. The industry’s rebound in early 2025, with 169.3 million subscriptions, reflects a foundation for this upward trajectory.

From 2020 to 2025, the Nigerian telecom industry has weathered a storm of challenges while achieving milestones in market growth, technological leadership, and infrastructure expansion. The path ahead promises market expansion, 5G-driven transformation, and greater digital inclusion, cementing telecom’s role as a catalyst for Nigeria’s socio-economic growth.