Three CDMA mobile operators – Starcomms, Multilinks and MTS – are seeking approval to merge, the Nigeria Communication Commission (NCC) said on Monday.
Lolia Emakpore, a director of the NCC told Reuters at a telecoms conference in Dubai she expects the mobile subscriber base in Nigeria to grow 14 percent next year to 120 million.
Most subscribers are on systems that use the GSM technology and CDMA operators have been hardest hit by increasing competition.
“The discussions are going on and are not concluded yet. It’s purely a commercial thing between the companies,” she said of the proposed three way merger. “We are looking at them coming together and becoming a bigger CDMA provider.”
Asked whether they had already submitted applications to the regulator to merge, she said: “I believe so.”
Starcomms is the only telecoms company in Nigeria that is listed on the local bourse.
The number of mobile users in Africa’s most populous nation crossed the 100 million subscriber base in the first half of the year, adding six million new callers from 2011.
Analysts say average revenue per user (ARPU), a measure of industry profitability, is not keeping pace with the growth in subscriber numbers, owing to increased competition and the fact that the new subscribers tend to be poorer.
CDMA operators have been the worst hit.
“I believe the industry is still vibrant and the profitability issues are short (lived), particularly for mobile operators,” Emakpore said, adding that growth in data and Internet usage will compensate for declining revenues in voice.
Mobile operators in Nigeria’s telecom market added 7 million new subscribers in the last quarter of 2008 alone, the highest number of net additions since GSM technology was introduced in 2001, according to Informa data.
Big GSM operators include the local units of South Africa’s MTN Group and Bharti Airtel.