Nigeria’s internet service provider industry is facing a major downturn, with data from the Nigerian Communications Commission revealing the steepest subscriber drop in recent years.
Over 18,000 users disconnected from fixed broadband between Q3 2024 and Q1 2025, and 18 licensed ISPs exited the market—highlighting the growing dominance of mobile internet and rising operational costs.
Leading providers were not spared. FibreOne suffered the worst hit, shedding 42.4% of its subscribers. Starlink, which had been seen as a promising disruptor, recorded a 9% decline, while Spectranet lost 2.08% of its user base. The total number of fixed broadband users in Nigeria fell from 307,946 to 289,369 during the same period.
Industry observers say this marks a clear shift in consumer preference toward mobile data, driven by affordability and accessibility. “Why pay more for fibre or satellite when you can get mobile data for ₦500?” one telecom executive remarked anonymously.
While convenient for casual use, mobile internet lacks the stability and bandwidth required for services like remote learning, telemedicine, or enterprise operations—areas where ISPs traditionally excel. However, economic challenges and high upfront costs for installation have stunted growth outside urban areas.
Starlink’s arrival in Nigeria in 2023 had sparked optimism, especially for underserved communities. But the optimism has faded. The service’s high hardware and subscription costs have discouraged wide adoption, not just in Nigeria, but across key African markets like Kenya, Rwanda, and South Africa.
“Many Nigerians are scaling back on their Starlink subscriptions,” said a local retailer. “The service plan adjustments didn’t help.”
The industry is also seeing a sharp contraction in the number of active players. By Q1 2025, only 127 of Nigeria’s 234 licensed ISPs had active users—down from 252 licensed ISPs in Q4 2023, with just 106 active. Smaller providers are particularly vulnerable, unable to match the scale of mobile network operators or absorb increasing overhead costs.
“This isn’t just about losing customers,” said Diseiye Isoun, CEO of Content Oasis. “ISPs are critical to the broadband ecosystem—especially for schools, hospitals, and local businesses.”
Isoun is calling for government policy intervention, suggesting Nigeria adopt a hybrid model similar to Brazil’s state-backed Telebras, which subsidizes broadband for public institutions via partnerships with ISPs.
“Instead of relying solely on the market, we need policies that ensure minimum access where it matters,” he said.
Despite the challenges, ISPs remain vital for Nigeria’s digital future. They provide the high-capacity, reliable connectivity necessary for critical infrastructure like universities, industrial hubs, and healthcare facilities—where mobile data simply falls short.
However, Nigeria still lacks a robust policy or funding mechanism to support these services. Agencies like the Universal Service Provision Fund remain underfunded and poorly equipped to address the growing gap.
“There’s no coordinated effort to guarantee internet for strategic sectors,” Isoun added. “Redirecting part of subsidy savings to broadband access for schools and clinics could change that.”
Analysts suggest that consolidation—through mergers, acquisitions, or public investment—may be necessary to save the sector. “It’s similar to what happened in banking,” said telecom analyst Nnamdi Richards. “We need ISPs to scale or merge to survive—especially now, with seasonal disruptions like floods and power outages.”
As Nigeria’s digital economy grows, the ISP crisis raises fundamental questions about access, affordability, and infrastructure—and whether mobile internet alone can meet the country’s long-term needs.
