Etisalat Nigeria, an affiliate of the No. 2 Gulf Arab operator Etisalat, said a lack of reliable electricity and sabotage were to blame for poor service after the regulator fined telecom firms for failing to meet quality targets.
Etisalat Nigeria, Airtel Nigeria, Globacom and MTN Nigeria, a unit of South’s Africa’s MTN, were fined a total of 1.17 billion naira ($7.43 million) by the Nigeria Communication Commission (NCC) last week.
Etisalat Nigeria said fines averaged $2 million per operator for "non-compliance with the quality of service targets set by the regulator", according to an emailed statement.
"This year alone we are investing more than half a billion dollars in expansion of our network capabilities and capacity," Chief Executive Steven Evans said.
The company said capacity constraints alone where not to blame for poor service, citing roadworks, sabotage and a lack of electricity as industry challenges.
"Foremost among these is the absence of reliable power which necessitates that every one of our over 3,000 cell sites needs to be served by two generators which run 24 hours a day and need regular maintenance and provision of weekly supplies of diesel," it said.
Nigeria only provides its 167 million inhabitants with around a quarter of the amount of electricity used by New York City, leaving those who can afford it to use expensive diesel generators and those who cannot to live without any power.
The country’s power ministry has said it is confident privatisation in the sector will be completed by October and current power output of under 4,000 megawatts can be boosted to 6,000 by the end of the year and 10,000 by the end of 2013.
UAE’s Etisalat owns a 40-percent stake in Etisalat Nigeria, which launched services in 2008 and had 10.75 million mobile subscribers at the end of 2011, data from the regulator showed.
This gave it a mobile market share of 11.9 percent, behind MTN Nigeria’s 46 percent and Globacom’s 22 percent. Airtel, a subsidiary of India’s Bharti Airtel, had a 19.9 percent share.
Etisalat’s network covers 74 percent of Nigeria’s population, according to its parent firm’s 2011 annual report, up from 59 percent a year earlier.