The competitive landscape for dedicated Internet Service Providers (ISPs) in Nigeria is undergoing a rapid and unsettling consolidation, with official data showing a significant contraction in the market and a handful of major players seizing control of high-speed broadband access.
This shift, driven by intensified competition, rising costs, and the aggressive expansion of Mobile Network Operators (MNOs), is shrinking the space for smaller, indigenous ISPs and raising concerns about the future diversity and affordability of Nigeria’s digital infrastructure.
Recent data from the Nigerian Communications Commission (NCC) confirms the market squeeze. Out of the over 220 ISPs registered, only about 133 were active as of Q2 2025, meaning nearly 40% of licensed providers have gone dormant.
Three major players, Spectranet, Starlink, and FibreOne, now account for approximately 65% of all ISP-connected customers (out of a total of around 313,000 ISP users).
While ISPs serve a specialized market, the larger Mobile Network Operators (MTN, Airtel, Glo) dominate the overall internet landscape, commanding over 140 million internet subscriptions, dwarfing the ISP sector.
Analysts point to four primary factors driving the contraction and consolidation. One is mobile operators are leveraging their vast financial resources and unified licenses to aggressively roll out 5G and Fibre-to-the-Home (FTTH) services, directly competing with and often undercutting traditional ISPs in the lucrative enterprise and residential fixed-broadband space.
Another is ISPs face immense structural challenges, including prohibitive Right of Way (RoW) charges from state governments, high costs of bandwidth, power supply issues, and the massive capital required to build and maintain fibre infrastructure.
There is also the case for significant consumer shift. Facing high inflation, consumers are increasingly opting for the flexibility and lower upfront costs of mobile data services over the often-premium pricing and hardware installation requirements of fixed ISPs.
Lastly, the satellite internet provider, Starlink, has rapidly captured the second-largest market share. While providing vital service, its premium pricing structure has also intensified competition among the remaining top-tier players, making it difficult for mid-sized ISPs to compete on either price or speed.
Consequently, the shrinking ISP market poses a critical risk to Nigeria’s ambitious National Broadband Plan (NBP 2020–2025), which targeted 70% broadband penetration by the end of this year (a target currently unlikely to be met).
Smaller ISPs often serve niche markets, industrial parks, specialized enterprise clients, and remote/underserved communities that are not commercially attractive to the major MNOs. Their disappearance could leave essential sectors like schools, hospitals, and local businesses underserved with the robust, dedicated connectivity they require.
The industry is drifting toward an oligopoly dominated by a few major players. While competition among the giants can be fierce, it reduces the overall marketplace diversity, potentially leading to less innovative products and higher prices for consumers in the long run.
The Nigerian Communications Commission (NCC) faces the urgent task of implementing asymmetric regulation, placing more stringent controls and obligations on the dominant players to ensure they do not stifle smaller, indigenous operators. The future of Nigeria’s robust digital economy requires a healthy, competitive mix of both large mobile operators and specialized fixed ISPs.
