Interconnected debt a cause for concern in Nigeria's telecoms industry?

The Nigerian telecommunications industry is currently facing a significant challenge in the form of interconnected debt, which is estimated to be around 165 billion naira as of December last year. This interconnected debt, which is the result of discrepancies in call traffic between network operators, has raised concerns about its impact on the industry and its stakeholders. To delve deeper into this issue, Gbenga Adebayo, Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), recently sat down with CNBC Africa to shed light on the intricacies of interconnected debt and its implications. Interconnection, as Adebayo explains, is the link between two or more operators that allows for the seamless exchange of calls across networks. When a call is made from one network to another, there is an originating network and a terminating network, each of which incurs charges based on the traffic exchange. The interconnected debt arises when there is a disparity in the volume of calls exchanged between operators, leading to one party being owed a significant amount of money. This debt, according to Adebayo, is a result of reconciliation issues and not a failure to pay for services rendered. To monitor and address these discrepancies, network operators utilize traffic monitoring devices and conduct regular reconciliations to ensure that all parties are paid what they are owed. However, despite these efforts, the issue of interconnected debt persists in the industry. In response to this challenge, regulators have intervened to facilitate discussions between parties and provide guidelines for resolving disputes. Additionally, measures such as reducing the number of trunks connecting operators and taking legal action against defaulters are being considered to address the interconnected debt issue. While the regulator plays a crucial role in mediating disputes and enforcing compliance, Adebayo emphasizes the importance of cooperation among operators to maintain the industry's integrity and sustainability. He acknowledges the competitive nature of the telecom sector but advocates for a balanced approach that prioritizes the interests of subscribers and upholds industry standards. Despite the complexities surrounding interconnected debt, Adebayo remains optimistic about the progress being made in recovering outstanding payments and resolving disputes. He underscores the need for continuous monitoring and dialogue among stakeholders to prevent the escalation of interconnected debt and ensure a fair and transparent telecommunications ecosystem. Moving forward, vigilance and collaboration will be essential in addressing the interconnected debt challenges and safeguarding the industry's growth and stability.