Economy

Nigerian Hosting Firms Blame Power, Forex and Foreign Competition for Sector Challenges, Call for Government Support

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The Chief Executive Officer of HoganHost and ZuumHost, Joseph Hogan, has raised concerns over the rising threat of illegal websites, cybercrime, and structural challenges facing Nigeria’s web hosting industry, while calling for stronger regulation and government intervention to boost the sector’s contribution to the economy.

Speaking in an interview, Hogan explained that hosting companies operate strict policies to combat fraudulent websites, noting that platforms found to be involved in scams are typically investigated and shut down when verified.

According to him, his companies have taken down about 15 fraudulent websites in the last two years as part of efforts to maintain digital safety and protect users from cyber threats.

He warned internet users to be cautious of suious links, noting that cybercriminals often exploit human error rather than technical weaknesses to gain access to personal data such as passwords and financial information.

Hogan acknowledged growing concerns about data protection, stating that web hosting is a critical backbone of digital business and that lapses in uptime, security, or support can result in significant losses for clients.

He emphasized the need for improved regulatory standards in Nigeria’s hosting sector, particularly around service accountability, uptime guarantees, and data protection, while stressing that regulation should support industry growth rather than restrict it.

On concerns about why many Nigerian developers prefer foreign hosting services, Hogan attributed the trend to historical limitations such as infrastructure gaps, inconsistent uptime, and slow customer support within the local industry.

He noted that although this perception persists, local hosting providers are now investing in stronger infrastructure and improving service delivery to compete globally and rebuild trust among users.

Hogan also addressed criticisms of poor service in the sector, arguing that unreliable providers damage business confidence but insisting that industry consolidation and expansion can help improve service quality and sustainability.

He revealed that his company recently acquired another hosting firm as part of a strategy to strengthen infrastructure and improve customer experience rather than a response to financial distress.

Highlighting operational challenges, he pointed to high power costs, foreign exce pressures, and infrastructure limitations as major obstacles facing Nigerian hosting companies.

He explained that unlike foreign competitors with le electricity and large scale infrastructure, Nigerian firms must rely on alternative power sources, significantly increasing operational costs.

Despite these challenges, Hogan maintained that local hosting companies have strong growth potential if supported with le power supply, improved infrastructure, and government policies that encourage data localisation.

He urged the Federal Government to invest more in digital infrastructure and encourage ministries, departments, and agencies to patronise local hosting providers in order to strengthen the domestic tech ecosystem.

According to him, increased local patronage would reduce foreign exce pressure, improve industry sustainability, and boost Nigeria’s contribution to gross domestic product through the digital economy.

Hogan also pointed to international partnerships and certifications across African markets as evidence that Nigerian hosting firms are gradually aligning with global standards despite existing constraints.

He concluded that with the right policy environment and infrastructure support, Nigeria’s web hosting industry could become a major driver of innovation, employment, and economic growth.

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