Struggling 9mobile seeks renewal under new management
In the highly competitive Nigerian telecom market, 9mobile, formerly known as Etisalat, has faced a tumultuous journey since its entry in 2008. The company, initially dominated by MTN Nigeria, Zain Nigeria (now Airtel), and Globacom, found itself in a significant debt crisis in 2017, leading to a series of challenges that impacted its market position.
The debt crisis, amounting to a staggering $1.2 billion, was the primary reason for Etisalat's collapse. The company was unable to meet its repayment obligations to a consortium of banks, leading to operational difficulties[1]. Financial mismanagement and regulatory pressure further complicated the situation.
Following the transition to 9mobile in 2017, the company faced several challenges. Rebranding and rebuilding trust with customers, financial recovery, navigating market competition, and maintaining operational efficiency were significant hurdles. The company's revenue streams were constrained by its limited spectrum holdings and inadequate fibre infrastructure.
One of the strategies Etisalat identified before its collapse was a gap in the market: unserved young subscribers. In partnership with Banky W, a rising Nigerian music star, they launched the "0809ja for Life" campaign, significantly boosting their market presence[2].
Despite these challenges, 9mobile has shown resilience. In 2020, the company secured a payment service bank (PSB) license from the Central Bank of Nigeria (CBN) and launched 9PSB, entering the mobile money service market, unlike MTN Nigeria and Airtel Africa[3]. However, the restrictions on PSBs limit the services 9PSB can offer, such as lending, insurance, and receiving foreign deposits.
In June 2023, LightHouse Telecoms finalised a $750 million acquisition of 9mobile, marking a new chapter for the telecom operator. As of 2023, 9mobile holds a 2.1% share of the market, a significant drop from its peak of 14% and 22.5 million subscribers in 2016[4].
The Nigerian Communications Commission (NCC) stepped in to stabilise 9mobile for acquisition in 2018, but the new owners, Teleology Holdings, could not raise the needed funding. The CBN bypassed them and issued the license to 9mobile and Globacom, accelerating the market's digital transformation[5].
The race for digital dominance continues, with MTN Nigeria applying for two additional licences, Payment Solutions Service Provider (PSSP) and Payment Terminal Service Provider (PTSP) in November 2024[6]. The future of 9mobile, now under new ownership, remains uncertain, but the company's resilience and strategic moves suggest a fight for survival in the competitive Nigerian telecom market.
[1] [Nigeria: Etisalat's $1.2bn debt crisis](https://www.bbc.com/news/business-39795201) [2] [Etisalat, Banky W partner to boost subscriber base](https://www.vanguardngr.com/2014/01/etisalat-banky-w-partner-boost-subscriber-base/) [3] [9mobile secures PSB license from CBN](https://www.pulse.ng/news/business/9mobile-secures-psb-license-from-cbn-id8848039.html) [4] [9mobile loses over 22 million subscribers](https://www.vanguardngr.com/2023/04/9mobile-loses-over-22-million-subscribers/) [5] [CBN issues PSB licenses to 9mobile, Globacom](https://www.premiumtimesng.com/business/banking/393766-cbn-issues-psb-licences-to-9mobile-globacom.html) [6] [MTN Nigeria applies for additional digital licenses](https://www.premiumtimesng.com/business/banking/520064-mtn-nigeria-applies-for-additional-digital-licences.html)
- To address its financial challenges, 9mobile identified a market gap for unserved young subscribers and partnered with Banky W to launch the "0809ja for Life" campaign.
- In an effort to diversify its services, 9mobile secured a payment service bank (PSB) license from the Central Bank of Nigeria (CBN) in 2020, launching 9PSB and entering the mobile money service market.
- Despite the restrictions on PSBs, 9mobile's move into the mobile money service market was a strategic decision Unlike MTN Nigeria and Airtel Africa, who have not entered this space.
- After facing several challenges, LightHouse Telecoms finalized a $750 million acquisition of 9mobile in 2023, marking a new chapter for the telecom operator, but 9mobile's market share has significantly dropped since its peak in 2016.
- In the midst of the competitive Nigerian telecom market, 9mobile's resilience and strategic moves indicate a fight for survival, as rival companies like MTN Nigeria continue to expand their digital offerings.
