More Nigerians are moving to 4G and 5G networks thanks to more affordable and flexible smartphone financing, according to telecom industry experts who spoke to TechCabal.

There were only 2.18 million 3G subscriptions in December 2023, while 2G usage, which accounts for more than half of mobile internet subscriptions (57.84%), also declined.

The growth in 4G and 5G subscriptions happened despite supply chain disruptions and inflationary pressures that raised the prices of smartphones by 30%, data from GSMA showed. Nigerians are tapping into flexible device financing opportunities to be part of the evolving 5G community, according to Karl Toriola, CEO of MTN Nigeria.  

On Arise TV’s show ‘Tech into the Future’, the telco CEO noted that since the rollout of 5G technology in 2022, the coverage has quadrupled in the country. MTN is working with several partners across the continent to make it easier for consumers to access mobile devices by paying at their convenience. However, Toriola says while momentum may take a while to build, it has deployed its fintech unit, MoMo PSB to help predict behavioural patterns and creditworthiness.  

The number of 5G subscribers rose to 1.04% of the total internet subscribers in December 2023 for the first since the Nigerian Communications Commission (NCC) started to track the data. The 4G network also saw its biggest growth in December with 31.33& of the market. 

How smartphone adoption is growing

The focus of telecom operators on pushing more investments in 4G and 5G network infrastructure means that vendors like TRANSSION, Samsung, Xiaomi, and many others are prioritising 4G and 5G-enabled smartphones. 

At least N613 billion was deployed into infrastructure by MTN Nigeria and Airtel Africa to expand their 4G and 5G networks by the end of 2022. MTN spent N504.33 billion on its network rollout while Airtel invested N108.79 billion in the same period. Those investments paid off in 2023. 

A December 2023 report by Canalys notes that the African region experienced an impressive 12% year-on-year growth in smartphone shipments, a total of 17.9 million units.  

As of January 2024, TECNO leads the smartphone vendor market with 26.03% followed by a sister brand, Infinix with 20.88%. Samsung is in third position with 11.43%, while Apple in fourth has 9.66% of the market.

The devaluation of the naira, which has seen it tumble to record lows, is likely to affect the momentum of vendors in 2024. TECNO said it plans to release four smartphones this year compared to the seven it released last year. All the smartphones released by the brand in 2023 were 4G and 5G enabled. However, the company spokesperson said the phones also accommodate all the networks. 

With more Nigerians finding easier ways to purchase new smartphones, penetration figures for the industry rose to 51% in 2023 and are expected to reach 55% in 2024. 

How smartphone financing is driving growth

Vendors also use innovative financing instruments to ease cost pressures on consumers in Nigeria and across Africa.   

Most smartphone financing takes the form of a Buy-Now-Pay-Later scheme which allows brand customers to purchase smartphones and pay the cost over a specified period. In 2022, for example, MTN announced a financing deal with Intelligra. The telco said its goal was to connect more Nigerians to the internet and create a Nigeria where people can achieve their dreams due to a lack of internet access. 

Airtel told TechCabal that it has a financing deal with iTel that encourages subscribers to purchase the brand’s smartphone ranges. 

“These deals are helping subscribers acquire 4G/5G devices and routers,” said Sam Adeoye, Airtel Nigeria’s head of public relations. 

Telcos winning the 4G/5G race

MTN and Airtel are the biggest winners of the internet data market in Nigeria. 

Generally, MTN maintains its lead in the internet market in Nigeria with the number of subscriptions rising to 70.6 million in December from 69.6 million and January 2023. It also means the telco recorded 4.21 million subscriptions in 2023. Airtel is second in the internet market with 45 million subscriptions. The telco added 3.27 million subscriptions in 2023. 

The telcos leadership of 5G particularly may not come as a surprise to many Nigerians given that the two telcos are the only 5G operators in the country that have launched their services and are now deploying across the country. While MTN Nigeria has 5G in 13 cities, Airtel said it had deployed in four cities so far and is currently testing in Osogbo, the Osun state capital. 

In terms of 4G connectivity, MTN Nigeria leads other operators offering 4G coverage 75% of the time, and Airtel, in second place, offers 4G coverage 71% of the time.