9mobile: A Telecom Phoenix Struggling to Rise from the Ashes
December 5, 2024, 4:15 pm
In the bustling world of telecommunications, 9mobile stands as a testament to both ambition and adversity. Once a beacon of hope in Nigeria's telecom landscape, the company has faced tumultuous times since its inception as Etisalat in 2008. The journey from a promising start to a struggle for survival is a tale woven with ambition, mismanagement, and a rapidly changing market.
When Etisalat first entered Nigeria, the telecom market was a fierce battleground. Three giants—MTN, Airtel, and Globacom—dominated the scene. Yet, Etisalat saw an opportunity. It targeted the youth, a demographic largely overlooked by its competitors. With a clever marketing campaign featuring popular Nigerian artist Banky W, the brand quickly resonated with young subscribers. The “0809ja for Life” campaign was a masterstroke, propelling Etisalat to the forefront of the market.
By 2016, the company boasted 22.5 million subscribers and a 14% market share. But the glory days were short-lived. A perfect storm brewed as financial mismanagement, regulatory pressures, and infrastructural inadequacies began to unravel the once-thriving telco. The company defaulted on a staggering $1.2 billion loan, a consequence of the naira's devaluation and its limited spectrum holdings. Unlike its competitors, Etisalat's revenue streams were constrained, leaving it vulnerable.
The fallout was swift. In July 2017, Etisalat Group severed ties, forcing the Nigerian entity to rebrand as 9mobile. This change was meant to signify a fresh start, but the challenges persisted. The new management faced an uphill battle, struggling to retain the existing business arrangements and manage a company in disarray. The departure of Etisalat left a leadership vacuum, leading to a revolving door of CEOs—five in just six years.
9mobile's operational woes were compounded by its inadequate infrastructure. With only 4,620 kilometers of fiber optic cables compared to MTN's 39,972 kilometers, the company found itself lagging behind. The sale of its base towers to IHS Towers further hampered its ability to generate revenue from infrastructure leasing. The company was caught in a web of debt, unable to invest in the necessary upgrades to compete effectively.
As subscriber numbers dwindled, the company’s reputation suffered. Between 2016 and 2023, 9mobile lost approximately 8.6 million subscribers. The situation worsened in 2024, with an additional 10.4 million subscribers lost due to regulatory audits. Today, 9mobile holds a mere 2.1% market share, a shadow of its former self.
Leadership changes were frequent, but they brought little relief. Each new CEO faced the same daunting challenges: a lack of funding, infrastructure deficits, and ongoing boardroom disputes. The company’s attempts to pivot towards mobile banking with the launch of 9PSB were met with skepticism. Unlike its competitors, 9mobile lacked a solid foundation in mobile money services, limiting its growth potential in this lucrative sector.
In June 2023, LightHouse Telecoms acquired 9mobile for $750 million, hoping to inject new life into the struggling brand. However, the anticipated turnaround has yet to materialize. The new owners have not announced significant capital investments, and subscriber numbers continue to decline. With an average revenue per user of just ₦1,616, recouping the investment from subscriber revenue seems a distant dream.
The operational challenges are stark. 9mobile's reliance on microwave links, rather than fiber optics, hampers service quality, particularly in urban areas. Reports of frequent fiber cuts and inadequate repairs have left subscribers in certain regions unable to make calls. The company's physical presence is dwindling, with many experience centers operating at reduced capacity or not at all.
Employee morale is low. The new management has not increased salaries or provided incentives, leading to a talent drain as skilled workers leave for competitors. The loss of Huawei's managed services contract in 2021 further exacerbated the situation, leaving 9mobile struggling to maintain its network.
Despite these challenges, there is a glimmer of hope. The new leadership team, including CEO Obafemi Banigbe, is focused on stabilizing the company and exploring partnerships for roaming services. This could expand 9mobile's reach without the heavy burden of infrastructure investment. Additionally, the company continues to generate revenue from enterprise customers, providing a lifeline in these turbulent times.
The road to recovery is fraught with obstacles. 9mobile must not only address its financial woes but also rekindle the innovative spirit that once made it a market leader. The telecom landscape is evolving, and the company must adapt to stay relevant.
In a market dominated by MTN and Airtel, 9mobile needs to remind consumers why it was once a favorite. It must leverage its brand recognition and tap into the youthful energy that initially propelled it to success. The potential is there, but it requires a strategic vision and a commitment to rebuilding.
As 9mobile navigates this challenging terrain, it stands at a crossroads. Will it rise like a phoenix from the ashes, or will it fade into obscurity? The answer lies in its ability to innovate, invest, and inspire. The future of 9mobile is uncertain, but the journey is far from over. The telecom giant has the chance to reclaim its place in Nigeria's vibrant market, but it must act swiftly and decisively. The clock is ticking.
When Etisalat first entered Nigeria, the telecom market was a fierce battleground. Three giants—MTN, Airtel, and Globacom—dominated the scene. Yet, Etisalat saw an opportunity. It targeted the youth, a demographic largely overlooked by its competitors. With a clever marketing campaign featuring popular Nigerian artist Banky W, the brand quickly resonated with young subscribers. The “0809ja for Life” campaign was a masterstroke, propelling Etisalat to the forefront of the market.
By 2016, the company boasted 22.5 million subscribers and a 14% market share. But the glory days were short-lived. A perfect storm brewed as financial mismanagement, regulatory pressures, and infrastructural inadequacies began to unravel the once-thriving telco. The company defaulted on a staggering $1.2 billion loan, a consequence of the naira's devaluation and its limited spectrum holdings. Unlike its competitors, Etisalat's revenue streams were constrained, leaving it vulnerable.
The fallout was swift. In July 2017, Etisalat Group severed ties, forcing the Nigerian entity to rebrand as 9mobile. This change was meant to signify a fresh start, but the challenges persisted. The new management faced an uphill battle, struggling to retain the existing business arrangements and manage a company in disarray. The departure of Etisalat left a leadership vacuum, leading to a revolving door of CEOs—five in just six years.
9mobile's operational woes were compounded by its inadequate infrastructure. With only 4,620 kilometers of fiber optic cables compared to MTN's 39,972 kilometers, the company found itself lagging behind. The sale of its base towers to IHS Towers further hampered its ability to generate revenue from infrastructure leasing. The company was caught in a web of debt, unable to invest in the necessary upgrades to compete effectively.
As subscriber numbers dwindled, the company’s reputation suffered. Between 2016 and 2023, 9mobile lost approximately 8.6 million subscribers. The situation worsened in 2024, with an additional 10.4 million subscribers lost due to regulatory audits. Today, 9mobile holds a mere 2.1% market share, a shadow of its former self.
Leadership changes were frequent, but they brought little relief. Each new CEO faced the same daunting challenges: a lack of funding, infrastructure deficits, and ongoing boardroom disputes. The company’s attempts to pivot towards mobile banking with the launch of 9PSB were met with skepticism. Unlike its competitors, 9mobile lacked a solid foundation in mobile money services, limiting its growth potential in this lucrative sector.
In June 2023, LightHouse Telecoms acquired 9mobile for $750 million, hoping to inject new life into the struggling brand. However, the anticipated turnaround has yet to materialize. The new owners have not announced significant capital investments, and subscriber numbers continue to decline. With an average revenue per user of just ₦1,616, recouping the investment from subscriber revenue seems a distant dream.
The operational challenges are stark. 9mobile's reliance on microwave links, rather than fiber optics, hampers service quality, particularly in urban areas. Reports of frequent fiber cuts and inadequate repairs have left subscribers in certain regions unable to make calls. The company's physical presence is dwindling, with many experience centers operating at reduced capacity or not at all.
Employee morale is low. The new management has not increased salaries or provided incentives, leading to a talent drain as skilled workers leave for competitors. The loss of Huawei's managed services contract in 2021 further exacerbated the situation, leaving 9mobile struggling to maintain its network.
Despite these challenges, there is a glimmer of hope. The new leadership team, including CEO Obafemi Banigbe, is focused on stabilizing the company and exploring partnerships for roaming services. This could expand 9mobile's reach without the heavy burden of infrastructure investment. Additionally, the company continues to generate revenue from enterprise customers, providing a lifeline in these turbulent times.
The road to recovery is fraught with obstacles. 9mobile must not only address its financial woes but also rekindle the innovative spirit that once made it a market leader. The telecom landscape is evolving, and the company must adapt to stay relevant.
In a market dominated by MTN and Airtel, 9mobile needs to remind consumers why it was once a favorite. It must leverage its brand recognition and tap into the youthful energy that initially propelled it to success. The potential is there, but it requires a strategic vision and a commitment to rebuilding.
As 9mobile navigates this challenging terrain, it stands at a crossroads. Will it rise like a phoenix from the ashes, or will it fade into obscurity? The answer lies in its ability to innovate, invest, and inspire. The future of 9mobile is uncertain, but the journey is far from over. The telecom giant has the chance to reclaim its place in Nigeria's vibrant market, but it must act swiftly and decisively. The clock is ticking.