Impact of Covid-19 on Telecommunication Industries in Nigeria (a Case Study of MTN)

CHAPTER ONE

INTRODUCTION

BACKGROUND OF STUDY

On January 30, the World Health Organization (2020) declared the novel coronavirus outbreak (COVID-19) as a global public health emergency of international concern. After four months her declaration, the virus spread to virtually all nations and territories of the globe. According to Worldometer (2020), as at 9 June 2020, the total global case stands at 7,303,229 with 412,766 and 3,592,208 deaths and recoveries. However the number of cases in Nigeria was reported to be 14,554 with 387 deaths as at 12 June 2020 (NCDC, 2020). To curb the spread of the COVID-19 the Federal Government in concert with various state government implemented lockdown in Lagos, Abuja and Ogun and later extended same to other parts of the Country. This lockdown has led to disruption of the economy with almost all the sectors of the economy impacted – movement of people and goods were curtailed, schools were closed, social and religious gatherings banned, and offices closed (with exception of essential services). Due to this jeopardized menace business and non business organizations, social associations, Government parastatals and even individuals carried several activities via the internet ranging from remote work protocols, conference meetings, online church services, online lectures, entertainment, including inter-personal communication etc. However all these activities was only made possible through the use and consumption of data and voice related services provided by the telecommunication industries.

The telecommunications (telecom) market is a part of the information and communication technology industry. The market is primarily engaged in operating and providing access to facilities for the transmission of voice, data, text and video (Businesswire, 2016). According to the International Telecommunications Union (ITU), 97 per cent of the world population lived within reach of a mobile cellular signal and 93 per cent within reach of a 3G (or higher) network. In the Americas, the Asia-Pacific region and Europe, over 95 per cent of the population is covered by a 3G or higher mobile broadband network. In the Arab States the figure stands at 91 per cent; the Commonwealth of Independent States, 88 per cent; and Africa, 79 per cent. Of the 85 countries that provided data on mobile phone ownership, 61 have a higher proportion of men with mobile phones than women (ITU, 2019, p.4). The telecoms sector of Nigeria has been in a dearth state, fraught with inefficiencies ranging from management, capacity, policy shortage, corruption and low telephony in relation to its population, only a selected few could afford the luxury of having a fixed phone at home or in offices-most telephone connection were found in government offices, multinational corporations and official residences.

Since the introduction of GSM to Nigeria, there has however been a significant improvement as total active subscriptions. According to the Nigeria Communication Commission (2020), telecoms data for Q4 2019 reflected that a total of 184,699,409 subscribers were active on voice as against 179,176,930 in Q3 2019 and 172,824,239 in Q4 2018. This represented 3.08% increase in voice subscriptions Quarter-on Quarter and 6.87% Year-on -Year. Similarly, a total of 126,078,999 subscribers were active on internet as against 123,163,027 in Q3 2019 and 112,065,740 in Q4 2018. This represented 2.37% growth in internet subscriptions Quarter on-Quarter and 12.50% Year -on -Year.

One of the interesting feature of tCOVID-19 pandemic is the speed at which most sectors of the economy switched from the usual physical nature of business interaction to the virtual business mode. Working from home, remote working and virtual meeting became the buzzwords among workers globally and in Nigeria. Schools from Nursery to University switched to e-learning platforms in other to keeping learning going with minimal disruption and so many more. Upon this ground this research is aimed at investigating the nature of Covid-19 outbreak on the telecommunication industries of Nigeria.

 STATEMENT OF PROBLEM

The Covid-19 outbreak affected every sector of the Nigerian economy including the telecommunications, media and technology (TMT) sector and many more. To curtail the wide spread of the virus in Nigeria, the stay at home safety strategic measure also known as “lockdown” was imposed on major cities of Nigeria. Hence the need for many organizations to adopt WFH protocols arose. Schools and churches also navigated to online platforms. Agwu (2020) opined that the Nigerian COVID-19 lockdown which was considered as one of the strictest in Africa started in February 2020 following the discovery of the index case in Lagos. The lockdown includes indefinite bans on domestic and international travels, prohibition of large gatherings, and closure of open market businesses and schools. Hence these restrictive strategies had effect on all the economic and non economic sectors of Nigeria. Therefore is this study, the research focus on analyzing the impact of Covid-19 on the telecommunication sectors/industries of Nigeria.

 PURPOSE OF THE STUDY

This study is on the “Impact of Covid-19 on Telecommunication Industries in Nigeria using MTN as case study. To achieve this, the following objectives are considered relevant.

1. Ascertain the nature of Covid-19 effect on the telecommunication industries of Nigeria.
2. Investigate the extent to which TELECOM products were consumed during the Covid-19 outbreak.
3. Examine if the revenue and profitability of Telecommunication industries in Nigeria were also affected by the outbreak of Covid-19.

 RESEARCH QUESTION

1. What is the nature of Covid-19 effect on the telecommunication industries of Nigeria?
2. what is the extent to which TELECOM products were consumed during the Covid-19 outbreak?
3. Was the revenue and profitability of Telecommunication industries in Nigeria also affected by the outbreak of Covid-19?

 SIGNIFICANCE OF THE STUDY

Since this study portrays the nature of Covid-19 effect on the telecommunication industries and also the significant roles played by this sector under study, it is therefore pivotal to note that the findings and theoretical aspect of this work will be relevant to the major players in the TELCOM sector of Nigeria and even the Nigeria Government. More study will also be significantly useful to students and researchers and other individuals who may have the interest to gather or carryout any study related to the topic under study.

 SCOPE OF THE STUDY

This topic on the Impact of Covid-19 on Telecommunication Industries covers only TELECOM companies in Nigeria precisely MTN. MTN Walk-in centres in Lagos are enrolled as participants for this study.

 LIMITATION OF THE STUDY

The limitations of this study includes:

a. Finance: Due to the economic difficulty that the people, including the researcher, was experiencing, the prospect of a greater sample size, which would have enabled the study to reach a larger region, has become impossible; thus, this work is limited to only Nigeria based MTN.

b. Time: It was not surprising that the researcher was limited by time frame as it posed a direct challenge to the effective coverage intended in the course of this report. It is the intention of the researcher to interview all the employees of the selected TELECOM company but because of numerous activities of the researcher which borders on both academics, work schedules and other social activities it became relatively impossible to explain the intention.

c. Attitude of respondents: The majority of workers fail to collect the questionnaires, and some who do collect pay urgent attention required in filling and returning it, and others did not return theirs at all. Others were less accommodating and may have provided untrustworthy information because they were afraid of being exposed, despite the researcher’s promise that all information would be treated with the utmost secrecy and only for education purpose.

DEFINITION OF TERMS

Covid-19: Coronavirus disease 2019 (COVID-19) is a respiratory illness that causes fever, coughing, and shortness of breath. COVID-19 is highly infectious, and it has spread throughout the world. Most people get mild to moderate illness. Older adults and people with certain health conditions are at high risk for severe illness and death.

Telecommunication: This is the transmission of information by various types of technologies over wire, radio, optical or other electromagnetic systems.

Telecommunication Industry: The telecommunications industries within the sector of information and communication technology is made up of all telecommunications/telephone companies and internet service providers and plays the crucial role in the evolution of mobile communications and the information society.