Nigeria’s telecom operators face mounting costs from unreliable power, fibre damage, vandalism and security challenges, threatening network reliability and profitability despite growing demand for connectivity.

Nigeria’s telecommunications industry has become one of the most important parts of the country’s economy, connecting millions of people to banking, commerce, education, healthcare and other essential services. Behind that connectivity, however, operators face an operating environment that makes it considerably more expensive to build and maintain networks than it would be in many developed markets.

For operators in a sector valued at N75tn, the cost of running their network goes far beyond investment in spectrum, towers and fibre. Telcos still have to contend with unreliable electricity, diesel costs, vandalism, fibre cuts, security expenses and the repeated replacement and relocation of damaged infrastructure.

Chief Executive Officer of MTN Nigeria, Karl Toriola, said these challenges have created a significantly higher operating cost environment for telecommunications companies in Nigeria.

“If you look at a site in Europe, electricity for a site in Europe could be in the range of $200 per month. Maybe I’m wrong because sometimes I quote wrong statistics and people come and hammer me. Let us say it is $500,” Toriola said in a chat with 2026 MTN MIP fellows at the weekend in Lagos.

“At a site in Nigeria, you have to first provide one or two generators. That is CapEx. The lifespan of a generator is four to five years, so you can calculate that. Then you have to fuel those sites every single month. Then you have to have battery backup because when you have frequent outages, you want to make sure the site is not going down every single time.”

While operators in markets with reliable electricity can largely depend on the national grid to power their infrastructure, Nigerian operators have had to build alternative power systems around their networks.

The World Bank has separately documented the economic consequences of unreliable electricity in Nigeria, noting that businesses increasingly rely on generators to cope with outages. Its research has found that generator ownership rises in areas with unreliable electricity, increasing the cost of doing business.

Earlier, the lender’s research found that Nigerian businesses with their own generators could generate a substantial share of their electricity requirements themselves and that self-generated electricity was estimated to cost between six and ten times more than electricity supplied through the grid.

According to the MTN boss, the cost of providing power alone makes operating a telecommunications network in Nigeria considerably more expensive than in Europe.

“So, it’s an exorbitant cost, just taking power alone, of running a telecommunications network compared to what it would cost you in Europe,” he said.

The Nigerian Communications Commission said more than 5,000 fibre incidents were recorded in the first six months of 2026 as a result of road construction, excavation and related civil works. The regulator said the incidents could disrupt essential services and impose significant costs on citizens and the wider economy.

The scale of the problem prompted the NCC in August last year to call for better coordination between road contractors, engineers, government agencies and telecommunications operators.

The commission said permanent secretaries in the Ministry of Works and the Federal Ministry of Communications, Innovation and Digital Economy had established a Fibre Optic Cable Protection Committee to develop a coordinated approach before, during and after road construction.

The NCC also said the Office of the National Security Adviser had been brought into the process because telecommunications infrastructure has been classified as Critical National Information Infrastructure.

Toriola said the company incurs substantial capital expenditure replacing and relocating damaged fibre. "It's an extremely, extremely high cost," he said.
The consequences also extend to network availability and revenue. Toriola said MTN could record a revenue upside of between 15 and 20 per cent if all network outages could be eliminated.

"If we can eliminate all the outages that we experience in the network, there will be revenue upside of somewhere in the range of 15 per cent to 20 per cent," he said.

The potential revenue opportunity is significant given that MTN Nigeria reported revenue of more than N3tn in its latest half-year results. Toriola's estimate suggests that network reliability is not simply an engineering or customer service issue but a significant commercial concern for the operator.

Every prolonged outage can affect data usage, voice traffic and enterprise connectivity, while the company continues to incur costs maintaining and repairing infrastructure.

Telecommunications infrastructure has become increasingly vulnerable to vandalism and theft, forcing operators to spend money protecting sites that would require considerably less security in safer operating environments.

Toriola compared Nigeria with parts of Europe, particularly highly secure countries in Scandinavia, where telecom sites can operate without the extensive physical security measures required in Nigeria.

“In a site in Europe, you wouldn’t bother putting a fence around it. You wouldn’t have a security guard. You would have no losses,” he said.

The situation is different in Nigeria, where operators have to secure sites, replace stolen or damaged equipment and work with security agencies to protect critical infrastructure.

The recent designation of telecommunications infrastructure as Critical National Information Infrastructure is therefore significant for the industry. Toriola said the designation would enable operators to obtain greater support from security agencies and give telecommunications infrastructure priority protection.

He said the law would also help operators deal with situations in which landlords or other parties interfere with access to telecommunications sites.

“If a landlord has an existing lease agreement with us and for some reason, and this does happen, a lease agreement for 10 years in advance, they just wake up one day and say, ‘I want more money’ and they block access to your site, we can, through security agencies, enforce access to your site to make sure the sites don’t get disrupted,” he said.

The higher operating costs have also complicated the debate around telecommunications tariffs. Operators have repeatedly argued that maintaining and expanding networks has become more expensive because of rising energy, infrastructure and security costs.

Toriola said the cost environment should be considered when comparing Nigerian tariffs with those in other countries.

“In terms of the tariffs that we charge, we are the second lowest in Africa, seventh lowest in the world, despite having a much higher operating cost environment,” he said.

The contradiction is becoming increasingly important as demand for connectivity continues to grow. Nigerians want faster and more reliable services, wider broadband coverage and cheaper data, while operators need to continue investing in infrastructure and absorbing the rising cost of keeping their networks operational.

Nigeria is also investing heavily in expanding its digital infrastructure, including fibre networks designed to improve broadband access and support the country’s digital economy. However, expanding infrastructure alone will not resolve the underlying cost problem if the infrastructure remains vulnerable to damage, unreliable power supply and inadequate protection.

Toriola believes communities also have a role to play in protecting telecommunications infrastructure.

He said security problems are partly linked to economic hardship but argued that communities need to understand that damage to telecom infrastructure ultimately affects the same people who depend on the network.

“Security is always local,” he said. “The consciousness in the local communities that if you allow criminal elements to attack telecom infrastructure, it affects your own quality of service every day.”

He said communities should regard telecommunications infrastructure as an asset that serves them rather than something that belongs only to the operator.

The NCC has also required operators to report network outages lasting more than 30 minutes, providing regulators, journalists and the public with greater visibility into the causes of service disruptions.

Toriola urged Nigerians to consider the possible causes of an outage before blaming telecommunications companies.

“If you can’t call, the first thing, don’t abuse MTN first,” he said. “Check within your environment. Did someone cut a fibre? Did the landlord shut down, maybe denying access to the site? Did the diesel go off because of a lack of diesel supply or something in the environment?”