Globacom and MTN in a Tussle Over Unpaid Debts

Tensions are simmering in the Nigerian telecommunications industry as telecom giants Globacom and MTN Nigeria engage in a heated tussle over alleged unpaid debts.

The dispute centers around Interconnection Traffic Exchange Points (IXPs), where operators route calls between their networks.

Globacom claims that MTN Nigeria has accumulated significant unpaid debts for carrying its traffic on its IXPs.

The exact amount remains undisclosed, but industry sources suggest it could run into several million dollars. Globacom has threatened to cut off call termination to MTN customers if the debt is not settled promptly.

MTN Nigeria, on the other hand, disputes the claims, insisting its payments are up-to-date. The company has accused Globacom of using the debt issue as leverage to negotiate favourable interconnection rates.

The Nigerian Communications Commission (NCC), the industry regulator, has stepped in to mediate the dispute. The NCC has urged both parties to resolve the issue amicably and avoid any disruption to services.

Analysts warn that a prolonged dispute could have significant consequences for Nigerian consumers. A disruption in call termination between the two networks could lead to call failures, higher costs, and degraded service quality.

It’s crucial for both parties to find a swift and amicable resolution to this conflict,” said Dr. Chukwuma Obi, a telecommunications expert based in Lagos. “A prolonged dispute could not only impact millions of subscribers but also harm the overall competitiveness of the Nigerian telecom sector.”

The Globacom-MTN debt dispute comes at a time when the Nigerian telecommunications industry is already facing numerous challenges. Stiff competition from new entrants, rising operating costs, and depreciating naira have put pressure on profitability.

The outcome of this debt dispute is likely to have far-reaching implications for the future of the Nigerian telecommunications landscape.

However, in other news, the Nigerian Communications Commission (NCC) has suspended the approval granted to MTN Nigeria to disconnect Globacom over unpaid interconnectivity debts. The partial disconnection was initially approved by the NCC, but the regulator has now put it on hold following an agreement reached by both telecom giants.

The NCC had approved MTN’s request to begin a phased disconnection of Globacom starting on January 18, 2024, due to unpaid interconnect fees. However, Globacom refused to pay the debt, leading to the partial disconnection.

The partial disconnection would have affected Globacom’s ability to receive calls from MTN subscribers, while MTN subscribers would have been unable to call Globacom lines. This would have caused significant inconvenience to customers of both telecom companies.

However, reports have it that MTN and Globacom have now reached an agreement, halting the disconnection by the NCC. The details of the agreement have not been made public, but it is believed that Globacom has agreed to pay the debt owed to MTN.

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Telecom Turbulence: A History of Disputes Between MTN and Globacom

This is not the first time that MTN and Globacom have been involved in a tussle over unpaid debts. In 2018, the Central Bank of Nigeria (CBN) fined MTN Nigeria $2 billion for allegedly repatriating funds illegally. The CBN accused MTN of not obtaining the necessary approvals before transferring the funds out of the country.

MTN denied the allegations and challenged the fine in court. The case was eventually settled out of court, with MTN agreeing to pay a reduced fine of $53 million.

In 2021, Globacom was also fined by the NCC for violating the Do-Not-Disturb (DND) directive. The NCC had directed all telecoms companies to activate the DND service on all lines, but Globacom was found to have violated the directive by sending unsolicited messages to its subscribers.

Globacom was fined N232 million for the violation, but the company denied any wrongdoing and challenged the fine in court. The case is still ongoing.

The telecoms industry in Nigeria is highly competitive, with companies constantly jostling for market share. However, this competition sometimes leads to disputes over unpaid debts and other issues.

The NCC plays a crucial role in regulating the industry and ensuring that disputes are resolved fairly and transparently.