Satellite coverage and bulk negotiations crucial for lowering telecom costs – Ebuka Ezewuzie 

He shared these insights during the Naijaonpoint September Industry Spotlight held on Saturday, titled “Beyond Connectivity: Telcos and the future of financial inclusion in Nigeria”.

Ezewuzie emphasized the financial pressures faced by telcos in maintaining terrestrial networks, paying licenses, and providing services.

To alleviate these costs, he noted the importance of renegotiating long-term contracts and exploring satellite technology to reduce reliance on physical infrastructure.

“Bulk negotiations allow telcos to secure lower costs for services or licenses, locking in contracts at favorable exchange rates to mitigate the impact of FX fluctuations,” Ezewuzie explained.

Through these long-term agreements with foreign suppliers, telcos can achieve discounts and protect against unpredictable exchange rate movements.

Ezewuzie also highlighted how MTN is working with satellite providers like Starlink to utilize low earth orbit (LEO) satellites for cost-effective coverage expansion, especially in areas where physical infrastructure is costly or difficult to build.

“With satellite coverage, operators can reduce capital expenditure, especially in remote areas,” he said.

Ezewuzie also addressed renewable energy as a way to cut costs.

Telcos, he noted, are increasingly looking to solar and wind power to reduce their dependence on expensive diesel and petrol.

“Powering terrestrial networks with diesel and petrol is very expensive, which is why telcos are exploring renewable energy options,” he stated.

By shifting to renewable sources, operators can significantly lower operational costs, especially in powering their network towers.

Localization was another key strategy Ezewuzie highlighted. Telcos are sourcing locally to reduce their dependence on foreign suppliers, helping to avoid the volatility of the Naira/USD exchange rate.

“Telecom operators are looking inwards, engaging with local service providers to reduce costs,” Ezewuzie said.

This shift is crucial for reducing overheads and securing more stable pricing for telecom operations in Nigeria.

Automation and diversification into fintech and digital services were also mentioned as important approaches for reducing costs and expanding revenue streams.

Automation and diversification into fintech and digital services were also mentioned as important approaches for reducing costs and expanding revenue streams.

He explained that telecom operators are increasingly using robotic process automation (RPA) to minimize labour costs and improve efficiency, while diversification into fintech and API (Application Programming Interface) monetization offers new avenues for revenue generation.

By focusing on these strategies, Ezewuzie believes that Nigerian telcos can reduce operational costs while maintaining high-quality services for their customers.