When Globacom first entered Nigeria’s telecom industry in August 2003, it faced stiff competition from established giants like MTN, Econet, and MTEL. However, the newcomer quickly made its mark with bold strategies that shook up the market. Per-second billing, introduced by Globacom, was a revolutionary move that forced its competitors to follow suit, offering a pricing model vastly different from the standard ₦50 per minute.
In another disruptive move, Globacom offered free SIM cards in 2004, underpricing its competitors, who charged as much as ₦2,000 for theirs. This aggressive marketing campaign, combined with celebrity endorsements, helped the company build a strong consumer base.
By the same year, while others were slow to embrace the future, Globacom made a forward-thinking move by launching 2.5G internet services to a select group of 70,000 subscribers. By 2009, it unveiled a 9,800km submarine cable in Lagos, positioning itself as a key player in connecting Nigerians to the global internet.
Globacom’s innovative start earned it a loyal following, with catchy ads and bold initiatives. However, as the company grew, it struggled to sustain the drive and creativity that marked its early success.
The Slide into Decline
Today, Globacom is a shadow of its former self, with a market share of just 13% and only 19.1 million subscribers. Despite being part of a 217 million-strong telecom market in 2024, the company is grappling with stagnation. For years, industry insiders have suspected that telecom operators, including Globacom, had inflated subscriber numbers by counting inactive users. A recent policy shift by the Nigerian Communications Commission (NCC), which now mandates a 90-day inactivity threshold for subscriber counts, has revealed that Globacom had to adjust its numbers, losing 40 million subscribers.
The company’s once-reliable reputation for service quality has also eroded. In August 2023, a cyberattack compromised customer data, and the breach remained unreported for an entire year, damaging Globacom‘s public image further.
Internal and Leadership Challenges
In October 2024, Globacom made a significant move, appointing a new CEO and board of directors, marking the first time someone outside of Mike Adenuga’s family would take the reins. This leadership change comes amid increasing pressure from the NCC, highlighting the company’s struggle with outdated management practices. Adenuga’s leadership has long been criticized for its heavy-handed, centralized approach, where decisions have often been bottlenecked by the founder himself.
Industry sources have noted that Globacom’s internal culture has become a significant hindrance to its progress. Some insiders describe the company as being run like a family business, with a lack of autonomy for executives and inefficient decision-making processes.
Regulatory and Financial Hurdles
As the only major local telecom operator, Globacom has benefited from a certain degree of regulatory leniency. However, this has raised questions within the industry. The company has been slow to pay its dues, including a longstanding ₦3 billion debt owed to MTN for interconnection fees, which was eventually settled for a much lower sum of ₦2 billion.
This pattern of delayed payments extends to vendors and business partners. Several past partners have complained about Globacom’s poor track record in paying for services, sometimes waiting up to 180 days for compensation.
One of the most glaring issues for Globacom has been its reliance on Adenuga as the sole financier, which has resulted in chronic underinvestment in infrastructure. Telecom analysts argue that to compete with giants like MTN and Airtel, Globacom needs to invest around $1 billion annually in capital expenditure—an investment the company has been unwilling or unable to make.
Unlike its competitors, Globacom hasn’t outsourced its tower operations to companies like IHS. Instead, it builds and maintains its own towers using foreign technical experts, which increases operational costs significantly. The telecom industry requires continuous investment in infrastructure to stay competitive, but Globacom has failed to keep up.
The Road Ahead
There are growing concerns that Globacom might face a similar fate to 9Mobile, another telecom operator that faltered after early success. Despite these challenges, Globacom still has valuable assets, including its submarine cable and a national operator licence, both of which offer significant revenue potential.
The company’s new leadership, along with increased regulatory scrutiny, could help stabilize the situation. Some believe that Globacom’s turnaround depends on embracing modern corporate governance and rekindling its innovative spirit.
“The new NCC leadership is focused on guiding Globacom to operate differently,” one insider stated, hinting at the possibility of a revival if the company can adapt to changing market dynamics.
However, many are skeptical about the company’s ability to recover. Industry experts remain unconvinced that Globacom’s founder, Adenuga, will be willing to let go of the reins completely, and the company’s future success will likely hinge on its commitment to innovation and sound corporate governance.
