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In relation to the economy as a whole which recorded a real growth rate of -0.36% in the first quarter, growth in the telecommunications sector increased to 5.00% in the first quarter, from 3.49% in the final quarter of 2015.
The share of telecommunications in total real GDP had declined throughout 2010 to 2014, but for the last five quarters growth in telecommunications has been higher, meaning the trend has reversed.
The total number of subscribers has increased rapidly over the past decade. At the end of 2005 there were 19,519,154 subscribers, but by the end of 2015 there were 151,017,244, which is equivalent to an increase of 13,149,809 every year.
Growth has been declining more recently, possibly as a result of high market penetration leaving less room for large expansion. In March 2016, there were 148,745,464 subscribers compared with 143,934,208 in March 2015, which represents an increase of 4,811,256 or 3.34%. Notably, this represents a decrease of 1.50% relative to the end of the previous quarter; this is the first quarterly decrease on record.
Global System for Mobile Communications (GSM) subscriptions were the only type to increase between over the year to March 2016, although at 4.06%, the growth rate was lower than in previous months.
According to the Nigerian Communications Commission (NCC), Lagos State accounted for the largest share of active voice subscribers with 19.04 million or 12.8% of the total, followed by Ogun State with 8.53 million subscribers (5.7%) Kano State with 7.81 million (5.25%), Oyo State with 7.53 million subscribers (5.06%) of the total, then FCT and Rivers State with 6.03 million (4.05%) and 5.84 million (3.93%) respectively.
On the other hand, Bayelsa (1.11 million), Yobe (1.40 million), Ekiti (1.42 million) and Ebonyi (1.43 million) had the smallest number of active subscriber as of q1 2016.
Lagos State was the dominant market for all of the active voice telecom companies accounting for 10.05% of MTN total voice subscribers (followed by Ogun, Kaduna and Rivers in that order); 10.03% for Glo (followed by Oyo, Niger, Ogun and FCT in that order); 16.0% for Airtel (followed by Ogun, Kano and Oyo); and 19.1% of Etisalat voice subscribers (followed by Ogun, Kaduna and Rivers in that order)
Mobile subscribers using GSM dominate, and accounted for 99.09% of the total in December 2015, followed by CDMA with 0.79% of the total, whist fixed wired and wireless make up 0.08% and 0.03% respectively.
The dominance of GSM users has increased slightly since March 2015, when 98.41% of subscribers used this technology type, and also since the end of the 2015 when the percentage was 98.45%. The share of all other technology types has decreased between March 2015 and March 2016, but the largest decrease was for CDMA, whose share fell from 1.46% in March 2015.
The dominance of GSM over CDMA in the mobile technology is characteristic worldwide; GSM accounted for over 80% of the global market in 2009 Q2 according to industry estimates. With GSM technology, it is cited as being easier to switch networks, and it is regarded as being more accessible for international use, especially given that some markets (such as in Europe) have mandated the technology by law. However, CDMA is more prevalent in the United States.
In March 2016, the total number of GSM subscribers was 147,398,854, an increase of 5,756,018, or 4.06% relative to March 2015. This was less than half the size of the year on year increase in December 2015 of 8.78%. In addition, the number is 1.09% smaller than at the beginning of the quarter in January, when there were 149,022,919, although in February there were the fewest GSM subscribers, at 146,288,370.
The difference in trends that began in August 2015, between MTN and Etisalat on the one hand and Globacom and Airtel on the other, continued into the first quarter of 2016. Despite a slight recovery for both providers in March, Etisalat and MTN nevertheless saw their subscriber numbers fall, from 22,161,290 in December to 21,877,542 in March for Etisalat (a drop of 1.28%) and from 61,252,387 in December to 57,045,721 in March for MTN (a drop of 6.87%).
Each provider also recorded a year on year decline, of 1.61% and 6.71% respectively. This is demonstrated in figure 3, which shows subscriber numbers for each company indexed to March 2015.
By contrast, Airtel and Globacom continued their uninterrupted upward trend in subscriber numbers; Airtel recorded monthly increases of 2.75%, 1.33% and 0.81% in January, February and March 2016, and Globacom recorded increases of 0.59%, 2.75% and 1.78%.
As a result, Airtel had 33,866,798 subscribers in March 2016, which is an increase of 18.08% relative to March 2015. Globacom had 34,608,793 subscribers, which is an increase of 17.01% over the same period.
Airtel’s and Globacom’s respective shares of the total number of GSM subscribers in March 2016 were 22.98% and 23.48%, higher than in any previous month over the last two years but nevertheless still significantly lower than MTN’s share of 38.70%. Etisalat accounted for the smallest share as in previous quarters, with 14.84% of subscribers.
