Following outrage over the astronomical increase in the acquisition and subscription tariff reeled out by Internet Service Provider (ISP), Starlink, the Nigerian Communications Commission (NCC) has issued a statement noting that the company’s action contravenes the Nigerian Communications Act 2003, and had initiated “pre-enforcement actions against the company since Thursday, October 3, 2024 as punitive consequences of such violation.
The statement was however silent on the nature of “pre-enforcement actions” it has initiated against the erring operator.
The Commission, the nation’s telecommunications regulatory body, in the statement today, signed by the Director, Public Affairs, Reuben Muoka, noted that the action “is in contravention of Sections 108 and 111 of the Nigerian Communications Act (NCA) 2003, and Starlink’s Licence Conditions regarding tariffs.”
The statement had earlier stated that the decision by Starlink to unilaterally review its subscription packages upwards did not receive the approval of the Nigerian Communications Commission (NCC).
The Commission emphasised: “The decision by Starlink to unilaterally review its subscription packages upwards did not receive the approval of the Nigerian Communications Commission (NCC).”
Starlink had, at the beginning of the month, effected an increase in its monthly subscription fee by 97%, from N38,000 to N75,000. Additionally, new users will face a higher cost for the Starlink kit (the hardware needed for installation), which is now priced at N590,000, up 34% from the previous price of N440,000.
The company had, in a message to its customers in Nigeria, cited “excessive inflation” as the reason for the increment.
It will also be recalled that telecom operators under the aegis of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) had been clamouring for permission from the NCC for an increase in tariff to enable them cover up for the operational challenges, especially with continuous increase in FOREX. They allege that the telecom industry has remained the only industry that has not reviewed its prices despite the rising inflation in the country and other economic realities that warrant increment.
In response to their request, the Minister of Communications, Innovations and Digital Economy, Dr. Bosun Tijani, had, in a forum, urged the operators to explore innovative solutions to counter inflationary pressures and high operating costs, noting that increasing data, voice, and text message prices is not the “sole or optimal solution” to the sector’s challenges.
According to the NCC, by increasing the tariff without approval of the Commission, Starlink, owned by Billionaire X (formerly Twitter) owner, Elon Musk has contravened Sections 108 and 111 of the NCA.
Section 111 under the “Penalty for operating unapproved tariffs, charges, etc,” states “Notwithstanding any other provision of this Act, the Commission shall prescribe and enforce appropriate financial penalties upon any holder of an individual licence who exceeds the tariff rates duly approved by the Commission for the provision of any of its services.”
Section 108 enumerates the tariff rate regulations:
- 1) Holders of individual licences shall not impose any tariff or charges for the provision of any service until the Commission has approved such tariff rates and charges except as otherwise provided in this Part.
- 2) The licensees specified in subsection (1) of this section shall provide services at the tariff rates and charges so approved by the Commission and shall not depart therefrom without prior written approval by the Commission of such proposed changes in tariff rates and charges.
- 3) All licensees mentioned in subsection (1) of this section shall publish the tariff rates charged to customers for their respective services and the modifications thereto as may be approved from time to time by the Commission.
- 4) The tariff rates established by a licensee mentioned in subsection (1) of this section shall be on the basis of such principles as the Commission may from time to time stipulate in its guidelines or regulation including the following—
- a) tariff rates shall be fair and, for similarly situated persons not discriminatory ;
- b) tariff rates shall be cost-oriented and, in general, cross-subsidies shall be eliminated ;
- c) tariff rates shall not contain discounts that unreasonably prejudice the competitive opportunities of other providers ;
- d) tariff rates shall be structured and levels set to attract investments into the communications industry ; and
- e) tariff rates shall take account of the regulations and recommendations of the international organisations of which Nigeria is a member.
