Ban of Promos and Lotteries: Is NCC Promoting Unfair Advantage?
In a move purportedly geared at protecting consumers, the Nigerian Communications Commission, NCC took the industry by storm on November 12, 2012 with an announcement prohibiting telecommunication operators in Nigeria from engaging in promos and lotteries, citing consumer complaints while drawing power from its mandate as regulator of the industry.
In a release titled “ban of all promotions and lotteries by telecommunications operators,” signed by Tony Ojobo in his capacity as Director, Public Affairs, the NCC declared inter alia: “The Commission has, in recent times been inundated with several complaints from consumers (and) industry stakeholders against the various (sales) promotions offered by telecommunications operators.
“Consistent with its processes, the Commission has carefully evaluated the complaints received especially against the backdrop of sustaining the integrity of the networks, the general interest of the consumers, the socio-economic impact of these promotions on operators and other relevant stakeholders.”
Striving to justify the ban and probably make it populist, Ojobo averred in the release that “the Commission is also mindful of its statutory responsibilities such as; to protect and promote the interest of consumers against unfair practices, promote fair competition in the industry by protecting operators from misuse of market power and anti-competitive/unfair practices by other operators.”
While stakeholders have nothing against the NCC wielding the big stick in the bid to sanitise the market, there is a huge outcry against this blanket ban by those who should know, as it is seen as unfair to some competitors, thereby fuelling the very “misuse of market power and anti-competitive/unfair practices by other operators.”
Kola Amodu a PR Consultant with expertise and a rich vein of experience in the Nigerian telecommunications sector while decrying the ban described it as “wielding a sledge hammer to kill a fly.” He would have welcomed the ban had it come after a proper assessment of each promo or lottery so that promos and lotteries found wanting would have been singled out for banning. In his thoughts, only then would the NCC be said to be acting in favour of consumers.
“The NCC,” according to Amodu, “is waking up at a very late moment.
What is the sincerity of the purpose?” he asked, intoning that if the NCC has consumers in mind, it would have ensured a proper assessment of each offering so that only those seen as defrauding the consumer could be banned.
In the same vein, Shola Salako, a consumer activist and advocate speaking on a Lagos based radio station recently observed that “the Commission by this blanket ban has only denied consumer the chance of getting little benefits that the networks that deny him/her of quality services that he/she has paid for compensate him/her with through promos.”
Amodu and Salako agree that promos are part of marketing efforts of telecommunications operators and NCC ought to have exercised caution in sweeping an avenue of priming the market away. They opined that NCC ought to concern itself more with quality of service issues since telecommunication service is technology based, they reasoned that the regulator could easily investigate networks that are overloaded due to promos or whatever reasons and met out cogent sanctions like suspension of sale of SIMs instead of moving in a way that tends to strengthen one operator against the others.
Similarly, Chidiebere, in responding to an online discourse initiated by celebrated blogger, Linda Ikeji on the issue reasons: “should they
(NCC) ban all promos or try to investigate and prosecute detected foul play by any of these operators, like the MTN aeroplane, GLO 1 million dollars, etc?”
Chidiebere reckons that NCC's concern on call rates sounded frivolous, tending to make it clear that the Commission's motif must be something other than the consumer. “As for the call rate, why should NCC be bitter that it is low?” the blogger queried.
Amodu, Salako and Chidiebere all think that there should better and more effective ways of prompting service providers to improve on quality of service instead of a blanket ban on promos. “If poor network is being experienced, shouldn't NCC step in and ensure that operators restore good networks. So networks would be better when we call at N100 per sec,” Chidiebere posted online. In Amodu's opinion “promos are okay, if quality of service is good.” He emphasised that “the Commission should concern itself more with improvement of the quality of services than anything else.”
In a particular case of name and shame as Salako put it on radio, Prince Charming in contributing to the discourse posted: “Good one though, but they (NCC) should also work towards improving GSM and Internet connectivity offered by these networks, especially MTN. It
(MTN) cares less because it has the highest customer base. Its internet connectivity is the worst.”
Towing the same line of thought as Charming, Yino Tinto, another contributor to the online discourse stated that NCC ought to have been discreet in banning the promos factoring quality of service into the decision. “But they should have allowed Airtel,” Tinto posted.
According to Tinto, “these MTN people are the worst in service, yet they want to give their customers aeroplane!”
Market analysts are concerned that the intervention of NCC seems to have tweaked things in favour of the dominant operator, MTN that controls over 50 percent of the market. The case is made worse as the market leader co-hosts infrastructure with other operators like Etisalat and Airtel. These smaller operators appear dependent on the market leader to an extent for quality of service and the market instead of moving to improve infrastructure and quality of service appears bent on competing on price by tweaking with call rates for intra network calls. Consumers are looking forward to NCC reconsidering the ban because of the issues thrown up, as the Commission ought to be “mindful of its statutory responsibilities such as; to protect and promote the interest of consumers against unfair practices, promote fair competition in the industry by protecting operators from misuse of market power and anti-competitive/unfair practices by other operators,” in reaching and reviewing decisions such as the ban on promos and lotteries.