The Nigerian Communications Commission, NCC, has hiked International Termination Rate, ITR, from N3.90 per minute to N24.40 per minute, a 525 per cent increase. ITR is an interconnection charge set by mobile traffic carriers on calls originating from other networks.
A notice issued by the telecoms regulator, dated October 5, reads: “The Nigerian Communications Commission, on September 16, 2016 reviewed the termination rate for international inbound traffic from N3.90/min (about $0.013 today) to N24.40/min.
“The interim rate will subsist pending the conclusion of the study of the Determination of Cost Based Pricing for Mobile Voice Termination Rates.”
The over 525 per cent increase in the ITR could be traced to a recommendation in an analysis prepared by its Policy, Competition & Economic Analysis Department last year.
In an assessment of international voice traffic termination rates, NCC noted that while regulatory authorities tend to protect service providers and consumers, telcos and the government would prefer higher rates that bring in hard currency and can fund investment, expand domestic network, fund innovation and improve quality of service (QoS).
It also notes that revenues from international calls are seen as means of cross-subsidising domestic calls. This is tagged to a symmetrical system that shows money flows from developed to developing countries as most traffic originates from rich countries and high settlement rates favour the recipient countries.
