Rising Inflation Forces Nigerians to Opt for 2G Devices as Buying Power Shrinks

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Inflation in Nigeria has surged to an 18-year high of 25.80% in August, impacting consumers’ purchasing power. Many individuals are turning to older second-generation (2G) mobile devices due to budget constraints, with 60.32% of the country’s 220.36 million mobile subscriptions on the 2G network. This trend highlights economic uncertainty, leading consumers to prioritize basic communication needs over data-intensive applications. While Nigeria’s telecommunication companies have made significant network investments, smartphone ownership remains relatively low.

Key Points:

  • High inflation in Nigeria, reaching 25.80% in August, is affecting consumers’ purchasing power and leading many to opt for older 2G mobile devices.
  • The Nigerian Communications Commission (NCC) reports that 60.32% of the country’s 220.36 million mobile subscriptions are on the 2G network as of August 2023.
  • Economic uncertainty is prompting consumers to prioritize basic communication needs over data-hungry applications, contributing to the preference for 2G devices.
  • Only about 10 to 20 percent of Nigeria’s population owns a smartphone, according to Statista, indicating limited smartphone penetration.
  • MTN Group disclosed an increase of 1.8 million smartphones on its network in the first half of 2023, bringing smartphone penetration to 53 percent.
  • The wide coverage provided by 2G and 3G networks is one reason for their continued relevance, particularly in rural areas.
  • Rising smartphone prices are a significant barrier, with many lower-income individuals still using feature phones.
  • The average cost of 1 gigabyte of mobile data in Nigeria is $0.39 (N390), ranking the country 31st out of 237 countries for the cheapest mobile data.
  • Low-income workers earning below the minimum wage of N30,000 struggle to afford sufficient data for their basic needs.
  • Nigeria’s telecommunication providers have seen slower growth in internet service subscribers due to these affordability challenges.

Analysis: Nigeria’s high inflation rate is significantly impacting consumers’ ability to afford modern smartphones and data-intensive plans, leading to a growing reliance on older 2G mobile devices. The preference for 2G technology is driven by economic uncertainty and the need to prioritize basic communication needs. Despite significant investments in network infrastructure, smartphone ownership remains relatively low in Nigeria. This trend underscores the importance of addressing inflationary pressures and enhancing affordability in the telecommunications sector to promote digital inclusivity and economic stability.


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