Mobile operators budget $1.38bn for infrastructure upgrades

Nigerian telecom operators on Monday said they plan to invest about N1.86tn in 2026 to expand infrastructure, upgrade network capacity, and improve service quality across Africa’s most populous nation.

The Association of Licensed Telecommunications Operators of Nigeria said the planned investment would be directed towards network expansion, technology upgrades, and other operational improvements aimed at strengthening service delivery for millions of mobile and data subscribers nationwide.

The planned spending follows capital expenditure of N2.13tn recorded by mobile network operators, tower companies, and other industry players in 2025, reflecting continued investment in infrastructure despite persistent cost pressures, foreign exchange constraints, and changing funding patterns within the sector.

ALTON said the sustained capital deployment underscores the industry’s efforts to stabilise network performance and meet rising demand for data services, driven by increased digital adoption across banking, commerce, education, and entertainment.

“The sector’s recovery is reflected in sustained capital deployment. In 2025, mobile network operators, tower companies, and other players in the sector recorded a total capital expenditure of N2.13tn, with a planned capital expenditure of N1.86tn for 2026, directed towards network infrastructure expansion,” the association revealed in a statement.

The investment plans come amid mounting consumer complaints over service quality, months after telecom operators secured regulatory approval for a 50 per cent tariff increase that they said was necessary to support network upgrades and industry sustainability.

Subscribers have continued to report slow internet speeds, network outages, dropped calls, and failed digital transactions, prompting criticism that service quality has not improved in line with higher tariffs.

In March 2026, the Nigerian Communications Commission ordered telecom operators to compensate affected subscribers for service outages with airtime credits linked to usage patterns in impacted areas. Although operators blamed disruptions on fibre cuts, vandalism and power issues, consumers maintain that service quality remains inadequate.

The association noted that the investment cycle is increasingly being driven by domestic funding sources, including reinvested operational earnings, rather than fresh foreign capital inflows.

It pointed to data from the National Bureau of Statistics’ Capital Importation Report for the first quarter of 2026, which showed that foreign capital inflows into the telecommunications sector fell to $7.24m, compared with $80.78m recorded in 2025.

ALTON said the divergence between declining foreign inflows and rising infrastructure investment suggests that conventional capital importation metrics may not fully capture the scale of funding currently supporting network expansion in the sector.

According to the association, operators have increasingly relied on internally generated revenue to finance infrastructure rollout following the 50 per cent tariff adjustment approved in 2025, which it said helped stabilise revenues and restore financial viability across the industry.

The group added that the tariff adjustment enabled operators to move from a period of financial stress to one focused on network expansion and service quality improvements, particularly in underserved and high-demand areas.

ALTON said the planned N1.86tn investment for 2026 would prioritise network densification, fibre expansion, equipment modernisation and improvements in last-mile connectivity as operators seek to address persistent challenges around dropped calls, data speed inconsistencies, and coverage gaps.

The association also called for improved coordination among regulatory and statistical agencies to ensure more comprehensive tracking of sector investment flows.

It proposed closer collaboration between the Nigerian Communications Commission, the National Bureau of Statistics, and the Central Bank of Nigeria to develop a framework that better reflects both foreign and domestic capital deployment in the sector.

According to ALTON, a more inclusive investment measurement system would provide a clearer picture of the telecommunications industry’s contribution to Nigeria’s digital economy and help strengthen investor confidence.

The association reiterated that operators remain committed to continued investment in network resilience, capacity expansion, and service quality improvements despite macroeconomic challenges.

It said sustained investment is critical to supporting Nigeria’s broader digital economy ambitions, including financial inclusion, e-commerce growth, and improved access to digital public services.

ALTON expressed appreciation to the federal government for policy measures that it said had helped stabilise the industry and create conditions for renewed capital deployment.

The association said it remains committed to working with government and regulators to ensure that Nigeria’s telecommunications sector continues to play a central role in national development through improved connectivity and infrastructure expansion.