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B N W: Biafra Nigeria World News |
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Price War Brings Down Cost Of GSM Services
THE premium placed on the consumer as the bride in the communication market is taking the upward swing, as operators in the sector are falling over themselves to get her attention.
Barely three weeks after the Nigerian Communications Commission (NCC) ordered a stop of the sales of Global System of Mobile communications (GSM) starter packs intended to be activated at a later date, a price war among the operators has ensued. It has reduced cost of services up to 60 per cent in some cases.
It would be recalled that a service provider, MTN Nigeria Ltd, a few weeks back started a promo that made prospective subscribers to pay for SIM packs that had a future activation date.
Sources, however, said that some operators petitioned the NCC, which prompted Mr. Ernest Ndukwe, NCC Executive Vice Chairman, to direct the company to discontinue the promotion, saying that the cost of starter packs by NCC calculation would have gone down beyond what was advertised.
The chief regulator also said the practice was akin to "tying the hands of potential subscribers" from making wider choices within the system.
But in a swift reaction to the development, the various GSM outfits reacted further by announcing sharp cuts in prices of their various services.
First to react in this direction was Globacom, which slashed its monthly access charge for one of its popular post-paid services, from N2,500 to N1,750 a month with no charge to be made in the first month of subscribing to the service.
According to Mr. Paddy Adenuga, the executive director of the company, who described this as a "mere gesture to the public," added that there was also expansion programme that would cause the operator to increase its network from the present 1.5 million to 5 million-subscriber base, within one year.
He told The Guardian that his company had reduced by 45 per cent the tariff for international call through its network.
It was gathered that in its status as a second national carrier, Globacom has provided access for other telecommunications operators in the country to link countries in Europe and America.
Adenuga said: "With what is in place now, it is possible for Nigerians to browse the World Wide Web (www) and enjoy other multi-media services, like the rest of the world where GSM exists, with their mobile phones, which have the necessary features for the services.
Similarly, Vmobile has slashed the cost of its starter pack from N7, 000 to N2, 999 starting from this month.
An official of the company said that the decision to reduce prices is to ensure that it remains as the major player in the industry.
In its own reaction to the on going price war, Mtel announced the reduction in the cost of its Rose recharge cards from N5, 000 per card to lower denominations of N400, N1000 and N2000.
The management of Mtel, which is a subsidiary of NITEL, said that it is still leading as the network with the lowest tariff in local and international calls in the country.
But MTN, which is said to have the highest subscriber volume at the moment, has re-introduced its suspended per second billing method and added more services, which it said are aimed at retaining its customers from "running over to the rival" operators.
However, NCC has maintained that more price crashes would be experienced next year.
"We are anticipating that by next year, prices of subscriber identification module (SIM) would come to less than N2, 000," said Ndukwe while reacting on the price reductions in the system.
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