NCC Blames 5G Spectrum Sales Shortfall for Low Revenue in 2024
By Patience Ikpeme
The Nigerian Communications Commission (NCC) has attributed its low revenue generation in 2024 to the failure of telecommunications companies to purchase 5G spectrum licenses.
The Commission’s Director of Financial Services, Yakubu Gontor, and its Executive Vice Chairman (EVC), Aminu Maida, made this disclosure during the 2025 budget defense before the National Assembly Joint Committee on Communications in Abuja on Thursday.
Gontor explained that market conditions prevented the NCC from auctioning additional 5G spectrum slots. He noted that two major telecom operators that had already acquired 5G spectrum were underutilizing it, while the third-largest operator, which the Commission had anticipated would make a purchase, decided it was not the right time for such an investment.
Instead, the operator opted to focus on expanding its existing business. Additionally, 9mobile’s ongoing financial restructuring made it an unsuitable candidate for spectrum acquisition at the time.
He further revealed that despite a 50% increase in telecom tariffs, the NCC may not generate significant revenue from spectrum sales in 2025, as telecom operators are currently prioritizing service quality over new spectrum investments. However, he expressed optimism that the introduction of new technologies, including 6G, could generate over $1 billion in revenue for the federal government in the future.
Explaining the NCC’s revenue model, Gontor highlighted that spectrum sales follow a 10-year cycle, similar to leasing land. He noted that when a lease is paid upfront for a decade, the revenue sustains operations for the next nine years, which accounts for the fluctuations in revenue generation from spectrum sales.
Presenting the NCC’s 2025 budget, Gontor stated that the Commission projects total revenue of N272.433 billion, with the bulk of it coming from an operating levy of N205.7 billion and spectrum fees of N49.784 billion. Other income sources will supplement this total. On the expenditure side, recurrent spending is estimated at N95.668 billion, while capital expenditure is pegged at N10.735 billion. Additionally, N30.13 billion has been earmarked for special projects, bringing the total projected spending to N136.534 billion.
Gontor added that the NCC expects to remit N120.836 billion to the Consolidated Revenue Fund (CRF), while remittances to the Universal Service Provision Fund (USPF) will be determined in 2025.
Providing insight into the 2024 budget performance, EVC Aminu Maida revealed that the NCC generated N195.8 billion, of which N111 billion was remitted to the CRF. He noted that N137.6 billion came from annual operating fees, while N26.4 billion was generated from spectrum fees, among other revenue sources.
However, Maida admitted that the Commission had initially projected N292.3 billion in revenue for 2024 but fell short due to its inability to auction a 5G spectrum slot. He explained that this shortfall also affected the NCC’s remittance to the federal government, as a significant portion of spectrum fees is allocated to the CRF.
Additionally, he pointed out that the 2024 budget had assumed a 12.5% cost of collection from the federal government, but this provision was not approved. As a result, the NCC’s actual operating income was only around 20-35% of the projected figure. Given these challenges, the Commission revised its 2025 revenue forecasts to reflect more realistic expectations.
Speaking on behalf of the Joint Committee, Senator Aliyu Ikrah Bilbis stated that the NCC’s submission would enable lawmakers to ask critical questions and provide guidance to improve the Commission’s operations in 2025.
