New NCC rule raises fear of higher smartphone prices

The federal government’s plan to make every mobile phone in the country traceable through the Nigerian Communications Commission’s (NCC) Device Management System (DMS) is raising concerns that the new regulatory rule could further increase the cost of smartphones.

The DMS requires mobile devices to be registered using their International Mobile Equipment Identity (IMEI) numbers before they can be sold or connected to Nigerian telecommunications networks.

The initiative is aimed at tackling stolen, cloned and unapproved devices, while improving compliance with the NCC’s type-approval requirements.

However, the policy has raised concerns among industry stakeholders over its possible impact on importers, traders, repairers and consumers in a market already grappling with high smartphone prices.

The concerns are significant because mobile phones have become more than communication devices in Nigeria. Smartphones are increasingly used for mobile banking, digital payments, education, work, e-commerce and access to government and other online services.

Research by the GSM Association showed that more than 140 million Nigerians lived in areas with 3G, 4G or 5G coverage but did not use mobile internet in 2025, with the affordability of internet-enabled smartphones identified as one of the barriers.

Under the DMS framework, licensed importers are expected to obtain NCC type approval, upload the IMEI numbers of devices and purchase invoices to the DMS portal, pay the applicable validation fee and obtain a pre-authorisation QR code.

The document is then verified by the Nigeria Customs Service for duty assessment before the device is whitelisted for use on Nigerian networks.

The NCC has indicated that phones that are not properly registered will eventually not be allowed to operate on Nigerian networks.

Edoyemi Ogoh, Director of Technical Standards and Network Integrity at the NCC, said the central registry would strengthen compliance with the Commission’s type-approval requirements.

According to him, the system would also help ensure that devices imported, sold and used in Nigeria meet required standards.

The Commission has also clarified that the DMS is intended for device identification and regulatory compliance and does not give the regulator access to the contents of users’ phones or private communications.

One of the major concerns surrounding the initiative is its possible effect on smartphone prices.

The NCC has discussed administrative validation charges of about N670 per IMEI for lower-cost and feature phones and slightly above N3,700 for high-end devices.

Although the charges may appear relatively small compared with the price of premium smartphones, stakeholders say they could become significant when passed through an already expensive supply chain.

The concern comes at a time when Nigerians are paying considerably more for mobile devices due to inflation, foreign exchange volatility, shipping costs, taxes and logistics expenses.

Budget smartphones that previously sold for between N50,000 and N100,000 now commonly sell for about N75,000 to N150,000, while mid-range devices that sold for between N180,000 and N350,000 now cost roughly N250,000 to N500,000.

Premium smartphones can cost more than N1 million.

The DMS charge is not responsible for these existing increases, particularly as full enforcement of the system has yet to begin. However, stakeholders fear that the additional cost could provide room for further price increases.

A senior official involved in stakeholder engagements on the DMS, who spoke anonymously, said the validation fee itself should not have a major impact on retail prices because importers, rather than retailers or consumers, would pay it.

The official, however, expressed concern that some importers could use the new requirement to justify much larger increases.

The official noted that an importer who pays about N3,700 for validation could potentially add N15,000 or N20,000 to the price of a device.

This has become a concern in an inflationary economy where businesses are already dealing with foreign exchange risks, financing costs and weak consumer purchasing power.

For consumers, the distinction between the official regulatory charge and the final increase in retail prices may ultimately matter little if the additional cost is transferred to them.

The DMS is not only about regulating telecommunications equipment. The government also wants greater visibility into the flow of mobile devices entering Nigeria through informal channels.

The country’s phone market includes major manufacturers and distributors as well as small-scale traders, micro-importers, refurbishers and repair technicians.

Some traders bring a small number of phones into the country from international markets, while others deal in used or refurbished devices.

The DMS is expected to make it more difficult for unregistered devices to enter the formal market by linking device identities with import documentation.

Customs sources said the system could help close loopholes that have allowed devices to enter the country without proper declaration.

If effectively implemented, the system would create closer links between importers, Customs and telecommunications networks by connecting IMEI records, invoices, customs declarations and network access.

Licensed distributors could also benefit if the system reduces the competitive advantage enjoyed by businesses that avoid regulatory and import requirements.

For smaller traders, however, the changes could create additional pressure.

The NCC maintains that anyone trading in communications devices is expected to meet the relevant regulatory and licensing requirements, regardless of the volume of business.

The Commission has provided a window for existing stock to be registered and for businesses to regularise their status before full enforcement.

However, traders operating on thin margins may find the administrative requirements more difficult to absorb than larger distributors.

Used and repaired phones could present another challenge.

Although the DMS does not prohibit lawful transfers of ownership, legitimate repairs that affect a device’s technical identity could create problems if the resulting IMEI is treated as suspicious or unrecognised.

Some industry stakeholders have also questioned whether the DMS is the most appropriate way to tackle problems such as under-declaration and informal imports.

Diseye Isoun, chief executive of Content Oasis, an internet service provider, argued that Nigeria already has systems capable of providing significant information about devices operating on telecommunications networks.

He noted that phones already have IMEI numbers, while SIM registration links subscribers to their mobile numbers and other identification information.

Isoun argued that information about the phones, brands and models being used could potentially be obtained through existing structures.

He also maintained that issues involving taxes, import declarations and border controls should primarily be handled by the relevant agencies responsible for imports.

The argument highlights a broader policy challenge surrounding the DMS.

While the NCC has a mandate to regulate communications equipment and ensure that devices meet approved standards, the mobile device market also involves Customs, taxation, importation and consumer affordability.

The debate comes at a time when smartphones have become essential to everyday economic activity.

For millions of Nigerians, a smartphone is now used for mobile banking, digital payments, education, work, e-commerce and access to government services.

This means that any policy capable of increasing the cost or reducing the availability of legitimate devices could have consequences beyond the telecommunications sector.

The NCC has maintained that the DMS is not intended to create another barrier for legitimate businesses but to automate existing compliance requirements.

The Commission has linked the framework to its Type Approval Business Rules and provisions of the Nigerian Communications Act requiring relevant manufacturers, suppliers and providers to obtain approval before communications equipment is sold or used.

The rollout has been phased following stakeholder consultations, with officials indicating that existing stock would not be subjected to the device-validation fee during the onboarding period.

However, several questions remain as implementation progresses.

How will consumers deal with used phones with unclear histories? What happens when a legitimate repair changes a device’s identity? How will wrongly blocked phones be restored? And who bears the financial loss when a legitimate device is rejected?

For the DMS to achieve its objectives, the system will need to curb cloned, stolen and non-compliant devices without creating unnecessary barriers for legitimate importers, traders, repairers and consumers.

Ultimately, its impact will depend not simply on how many phones are registered, but on whether Nigerians can continue to buy, sell, repair and use legitimate devices without facing avoidable additional costs.

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