MTN Rwanda Expands Airtime Credit to Data Bundles

MTN Rwanda announced that MTN Ihereze, the company’s prepaid credit service that gives customers advance airtime when their balance runs low, has been upgraded to include data borrowing. Customers dial a short code when their bundles deplete and can pay back the data on their next airtime recharge. The Ihereze service attracts a 15 percent charge on borrowed airtime, but a promotional offer of 7.5 percent will be applied on borrowed data until 30 June. 

Customers can borrow up to nine advances, subject to the subscriber’s eligibility. Once the oldest loan has been repaid, they are open to borrow again. 

This data borrowing concept is certainly innovative and may constitute a solution for cash-strapped mobile users in Rwanda’s prepaid market, but it also contains a feature that may alienate users.

Advancing airtime for voice services makes sense in that voice is traditionally the most basic service, and therefore the expectation is that it is the service that impecunious prepaid users would most want to safeguard in the event of depleting their allowances. The idea of extending this to data reflects the fact that data is now a critical plan feature even for those budget-oriented lower-end users who might want to borrow against future payment periods.

While users may not have a problem borrowing data now with the understanding that they will have a smaller allowance in the next recharge, they may well balk at the notion of paying interest on this data loan. A 15 percent rate might be seen as too onerous, and even the 7.5 percent promotional rate could come across as rather unkind. MTN could be undermining consumer loyalty and tarnishing its image to some extent by charging its prepaid customers interest on data. Time, of course, will tell.

Tarifica is a global SaaS company and a market leader in the real-time collection, analysis and delivery of telecom plan and pricing data worldwide. Through a mix of AI, modeling and market expertise, Tarifica tracks hundreds of thousands of plan and pricing data points daily. No other company tracks more. Tarifica's mission is to continuously convert data into the dynamic intelligence that fuels opportunities for its clients, the world's leading operators, regulators and consultants. 

Learn more about Tarifica at www.tarifica.com.

Extra Spectrum Assigned Amid Data Demand Surges in South Africa

The Independent Communications Authority of South Africa (ICASA) has granted mobile operators MTN, Vodacom and Telkom emergency spectrum to deal with an increase in data demand during the coronavirus lockdown.

ICASA said it considered applications for temporary radio frequency spectrum assignments in the 700 MHz, 800 MHz, 2300 MHz, 2600 MHz and 3500 MHz bands, including the use of television white spaces (TVWS), in an effort to ensure connectivity during the National State of Disaster. 

The aim is to ease network congestion, maintain good quality of broadband services for consumers, and enable service providers to lower cost of access.

While the lockdown has been extremely damaging or even fatal to many businesses, the mobile telecom sector has proved resilient and even has benefited to some extent, due of course to the greatly increased demand for mobile services for remote working, personal communication and entertainment to pass the time while in quarantine.

The benefit, though, would remain potential only if networks were not able to meet the data demands in a timely and efficient manner. So the freeing up and allocation of spectrum by national regulatory authorities is key if congestion is to be avoided or even mitigated.

In South Africa, Vodacom for example has recorded a 40 percent surge in data traffic since the start of the coronavirus lockdown in that country three weeks ago. While it is true that some of this growth can be attributed to the fact that Vodacom, MTN and some other operators recently zero-rated a number of websites, including university portals, Vodacom said that working from home and home entertainment drove most of the new demand. The trend may even continue a restrictions are loosened and even after the lockdown ends completely, if usage patterns change due to the change in habits. 

Tarifica is a global SaaS company and a market leader in the real-time collection, analysis and delivery of telecom plan and pricing data worldwide. Through a mix of AI, modeling and market expertise, Tarifica tracks hundreds of thousands of plan and pricing data points daily. No other company tracks more. Tarifica's mission is to continuously convert data into the dynamic intelligence that fuels opportunities for its clients, the world's leading operators, regulators and consultants. 

Learn more about Tarifica at www.tarifica.com.

MTN South Africa Must Withdraw Advertisement That Claim “Unlimited” Minutes

South Africa’s Advertising Regulatory Board (ARB) has found mobile operator MTN’s use of the term “unlimited minutes” in its mobile contract advertising to be misleading. MTN has been given two weeks in which to remove the claims that its MTN Sky packages have unlimited voice minutes, which actually amount to 3,600 minutes a month, ARB ruled. The ruling was in response to a complaint lodged with the board.

MTN advertised its Sky packages at a discount during Black Friday in November 2019, in which the claim that they supplied unlimited voice call minutes was followed by an asterisk. The asterisk at the bottom of the advertisement showed that this was subject to a “fair use policy.” It later emerged that “fair use” actually meant 3,600 minutes a month.

The operator responded to the complaint by saying the term “unlimited” has become common in the industry as a way to refer to products that offer excessive allocations of voice, data or SMS. These products are typically top-tier and more expensive, which means that customers make comprehensive comparisons before they enter into the contract. Reliance on asterisks for this purpose is common in the advertising industry, MTN said, and consumers would instinctively understand the intention behind such an asterisk.

The ARB previously ruled that asterisks are used to alert consumers that material terms are applicable and terms and that conditions apply to the promotion. The ARB said it found in previous rulings that the term “unlimited” should refer to offerings where there is no limitation.

We have written in this space about various controversies involving misleading claims of unlimited service. In the U.S., for example, government regulators delivered stern warnings to the major operators on the subject, and various changes were made in order to come into compliance. However, in most cases where complaints are lodged on the subject, the term “unlimited” applies to data; generally the scenario is that there is no upper limit on the allotment of megabytes, but that after a certain level is reached or under certain circumstances such as high usage volume within a given area, the speed is dramatically reduced, making the service of less value to users. The throttling, as it is called, may in some cases be so great as to render high-speed data service essentially useless for the purposes it is intended for.

This case involving MTN is somewhat unusual in that it applies to voice minutes, which is not typically a service that operators want to market as unlimited when they do not have the intention of providing an indefinite amount of it. In that sense, such a setup may grate on users even more than data-speed throttling would. Furthermore, the objection from users would likely have been on grounds beyond simply that of principle; 3,600 minutes a month translates to about two hours a day, which is an amount of conversation that quite a few users are likely to surpass under normal conditions.

The reaction from ARB should be taken a cautionary tale by mobile operators. The regulator did not look kindly on the operator’s explanation that “small print” to which the asterisk directed customers was a sufficient explanation, not only because of the principle involving the uses of such disclaimers, but also because the quantity of 3,600 minutes a month was not actually referred to in the text, which only used the words “fair use” without clarification. True, the regulator imposed no punishment but only ordered MTN to remove the advertisement and not use the term “unlimited” in this case, some damage has been done to the operator’s public image.

The lesson here is simply that operators tend to do themselves more harm than good with deceptive, or at best ambiguous, uses of the term “unlimited” and would do better to simply state clearly what the limits are. Customer confidence is a key ingredient in customer loyalty, which in turn is a key ingredient in a steady, long-lasting revenue stream.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.  

To learn more about Tarifica, please visit www.tarifica.com 

MTN South Africa Introduces “Smart” Feature Phone

MTN South Africa has launched the MTN Smart S device, a new feature phone manufactured by U.S.-based KaiOS Technologies. Priced at ZAR 249.00 (US $17.47), the phone supports popular apps such as WhatsApp, Facebook, YouTube, Google Maps and Google Assistant. It also has a web browser and is 3G-enabled. MTN is bundling Smart S with an allocation of 100 MB of data valid for 30 days for the first six months and 1 GB of WhatsApp bundles valid for 20 days for the first six months.

The device follows the recent launch of MTN Chat, which enables customers to top up airtime and data bundles via WhatsApp. MTN Smart S is available at selected MTN retail stores and major retail partners.

The Smart S device is a “smart feature phone,” a hybrid or intermediate device category that has appeal in developing and budget-oriented market sectors. Running on KaiOS, an open-source, Linux-based operating system, it is a white-label feature phone that is capable of accessing certain apps that require data, such as WhatsApp, Facebook and YouTube. The KaiOS company’s technology, which is also found in phones branded by Nokia and Alcatel, enables simple lightweight flip phones to perform tasks previously available only to smartphones, and at a very low price point. KaiOS is also behind the JioPhone, a similar white label device that is offered by Indian operator Reliance Jio.

By producing the Smart S device and self-branding it, MTN is making a savvy move. The device has the potential to bring the use of universally popular apps to a huge customer base that previously lacked access altogether. Furthermore, since such users are likely only familiar with feature phones, aside from the price issue, the Smart S will make it easier for them to make the transition to using data.

Ultimately, that is very likely to lead them to want fuller use of mobile data, with more better interface. That means that many Smart S users will eventually upgrade to true smartphones that cost more and use far more data, thus driving more revenue to the operator. In the meantime, by making this smart feature phone available, MTN will likely attract many new customers, sell more data and lay the groundwork for future profits by cultivating these new data consumers.

Tarifica’s products and services are powered by large-scale data from the global telecom industry and a deep level of expertise gained from our singular focus. We leverage these core attributes to help our clients understand their markets and answer their most challenging questions. Our team of analysts, software engineers and data scientists deliver real-time dynamic solutions for the telecom industry. Our software and state of the art data extraction techniques enable our clients to make smart decisions in real-time based on insightful, actionable data.

We are the telecom plan & pricing experts.

 If you have any questions about this article, feel free to contact our Editor-in-chief John Dorfman at jdorfman@tarifica.com

To learn more about Tarifica, please visit www.tarifica.com 

MTN South Africa Discontinues Free Twitter Data

Operator MTN South Africa is ending its offer of zero-rated data for Twitter, saying that it is no longer feasible because of the growing use of video on the messaging platform. MTN also announced changes to its WhatsApp and Twitter bundles, with more data to become available beginning in October.
 
MTN began to offer free Twitter data in May 2014, as a 90-day promotion, and extended the offer over the years. The operator said it was necessary to end the offer as of 25 September 2018 due to the cost and the demand it places on the network. In August, the number of free Twitter users on MTN’s network reached 13 million, using 1.9 petabytes of data.
 
At the same time, MTN also announced changes to its WhatsApp and Twitter bundles, effective 1 October. The weekly WhatsApp bundle increases from 100 MB for ZAR 5.00 (US $0.35) to 250 MB for ZAR 10.00 (US $0.70). The daily offer increases from ZAR 1.00 (US $0.07) to ZAR 2.00 (US $0.14) and from 20 MB to 50 MB. MTN’s Twitter bundles now come with 100 MB for ZAR 5.00, rather than 20 MB for ZAR 1.00, and the weekly rate will change from 100 MB for ZAR 5.00 to 500 MB for ZAR 20.00 (US $1.40).

Mobile operators’ promotions often go from temporary to long-term, acquiring the feeling of permanence. While they are initially advertised as short-term, they tend to be extended because of their ongoing efficacy in bringing in new subscribers, and because existing subscribers come to expect that the services will be continued at the same price. And when the costs to the operator are small or vanishingly small, it is no problem for that operator to continue the “promotion” package indefinitely.
 
However, if the costs change due to external factors, it becomes necessary for the operator to re-evaluate whether it still makes good business sense to maintain the promotion. In the case of MTN South Africa, it is clear that when the nature of the use of the application changed, the cost to the operator increased. When the promotion was first offered, Twitter was used mainly for text content; over time, more and more data-consuming video content came to be posted on it, to the point where it was not only costing the operator in terms of data not charged for, but actually overburdening the network. Almost 2 petabytes of data is indeed a huge number. Under these circumstances, the operator could no longer afford to keep the zero-rating of Twitter data going, and therefore terminated the promotion.
 
While Twitter-intensive customers may be unhappy about this change, there are reasons to believe that by finally ending the promotion, MTN may be activating one of the main purposes of data-oriented promotions, that is, to grow the data-consumption habits of subscribers by offering the data free, and then charging for it. After more than four years of ever-increasing data use over Twitter on its network, MTN may be able to realize a return on that investment.
 
And, of course, it is still offering its subscribers deals on Twitter, as well as on WhatsApp, by way of discrete packages in two tiers, daily and weekly. The WhatsApp deals are slightly more generous, in terms of economies of scale, which makes sense in light of the fact that the OTT messaging service is likely less heavily used for video than Twitter is.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.  

To learn more about Tarifica, please visit www.tarifica.com 

Lumos, MTN Partner in Solar Power Service in Cote d’Ivoire

Nigeria-based Lumos Global has officially launched a new, nationwide solar electricity service for Cote d’Ivoire, in partnership with mobile operator MTN Cote d’Ivoire. The Lumos Mobile Electricity Service aims to bring power to people who do not currently have access to an affordable, reliable or clean energy supply. The service is paid for using mobile phone credit and is available to all of the approximately 10.5 million MTN Cote d’Ivoire subscribers.
 
Minister for Economic Infrastructure Amede Koffi Kouakou, Lumos and MTN Cote d’Ivoire announced that the service will now be available in MTN stores across the country. The Lumos service has been available in neighboring Nigeria since 2016 and has experienced rapid growth; over 65,000 systems have been sold, providing 250,000 people with electricity. The service is enabling thousands of children to study into the evening, and it powers clinics and community centers across Nigeria.
 
 
Lumos’ solar energy product is aimed at providing electricity to people who live “off the grid” of conventional electricity suppliers. In rural Africa, large proportions of the population live off the grid, in remote areas, so initiatives like Lumos’ will be welcome, and solar energy in particular is appropriate to the climate.
 
Partnering with a mobile operator is an innovative and interesting approach for Lumos. It is not strictly speaking necessary in order for the service to be established, but it seems to us like an excellent synergy. In sub-Saharan Africa, making payments for a wide variety of goods and services via mobile money services linked to MNOs has become a way of life for many, especially in the rural areas. In this partnership agreement, solar-generated electricity will be paid for by MTN subscribers directly through their mobile credit with the operator, not through a broader mobile-money service such as M-Pesa.
 
For MTN (whose parent company is based in South Africa), the deal is a promising branding opportunity that associates the operator with a social good in Cote d’Ivoire and will likely create positive perceptions. Beyond that, though, it could have positive effects on the operator’s subscriber base. Consider that lack of electrical power in a region could have a very adverse effect on mobile subscriptions—without the ability to easily charge devices, people may not believe it worth their while or even possible to have a subscription. And since in order to pay for electricity in the underserved regions, an MTN account is necessary, the initiative stands to significantly boost uptake for the operator.
 
For now, at least, the deal is an exclusive for MTN. But since that limits access to the service, it seems that it would be in the interest of Lumos to expand the arrangement to include subscribers of other operators, in particular Orange, the country’s other major MNO. But at least for now, the initiative represents an important opportunity for MTN. 

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. 

To learn more about Tarifica, please visit www.tarifica.com 

Cell C to Address Concerns Over Data Expiration

South African operator Cell C plans to tackle the problem of expiring mobile data, according to a report. CEO Jose Dos Santos said that the operator is committed to doing the right thing, following proposed changes to national regulator ICASA’s End-User and Subscriber Service Charter Regulations. ICASA (Independent Communications Authority of South Africa) wants mobile operators to warn customers when their data bundles are about to expire, to block automatic out-of-bundle billing for data, and to allow data bundles to last longer.

Under the proposed regulations, mobile operators Vodacom, MTN and Cell C will have to stop customers from continuing to use data and being billed after a bundle is depleted. The operators must also extend the validity of a data bundle if a subscriber loads a new one before their current one has expired, and must warn subscribers before their bundle expires.

As a general principle, it is a good idea for operators to “get out ahead” of impending regulatory changes, voluntarily changing their own behavior before they are actually forced to do so by law. Such an approach serves as a demonstration of goodwill to customers and therefore shores up loyalty and helps with retention. In addition, the operator that makes the change first achieves a kind of first-mover advantage in terms of public images, especially if the change involves something that is particularly dear to customers’ hearts.

Not running out of data and not being charged excessively are certainly in that category. If Cell C in fact implements data-expiration warnings and stops out-of-bundle billing, it will most likely get an image boost. Deferring making changes and waiting for the inevitable cannot genuinely help an operator in the long run. And speaking of the long term, by building customer goodwill on the subject of data use, operators will actually encourage greater data use, which stands to increase revenue more than a strategy that relies on hoping that customers will run out of data unexpectedly and then be charged for it.



Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. 

To learn more about Tarifica, please visit www.tarifica.com 

     

MTN Uganda Launches Customized Offers on Voice Bundles

Mobile operator MTN Uganda has launched daily voice bundles custom-designed to fit the budgets and communication needs of MTN customers at an individual level. With the new package, called MyPakaPaka, the operator is using each customer’s usage behavior and average spend to craft three 24-hour bundles, unique to each customer. MyPakaPaka bundles cost from UGX 250.00 (US $0.07) to UGX 3,000.00 (US $0.82) for durations varying from 5 to 100 minutes and can be used to make calls to any other customer on the MTN network, valid within a 24-hour period. The package is an enhancement to the existing PakaPaka bundle. MyPakaPaka is available to both prepaid and postpaid customers.   As we have been charting in recent articles, and as Tarifica’s research shows, MNOs are slicing their portfolios thinner and thinner, creating focused offerings that address the needs of very discrete portions of the customer base. This is being done in response to perceived customer demand for flexibility and plans tailored to them in terms of features and price. MTN’s new customized offering in Uganda fits the bill exactly—and takes customization and focus to a new level. Instead of simply creating several plan modifications aimed at the aggregate usage behavior of variously defined demographics, MTN is creating packages that match up with the usage behavior and spending patterns of individual people. Not only that, by making them extremely short-term (micro-offerings with 100 minutes or less valid for 24 hours only), it is responding to the well-known commitment phobia of today’s users. Furthermore, as consumer behavior is constantly shifting, MyPakaPaka bundles can be constantly tweaked to reflect the customer’s needs at any given time—if the offer continues. We think this is a savvy (and low-risk) idea on the part of MTN. Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. To learn more about Tarifica, please visit www.tarifica.com

Cell C to Invest ZAR 8 Billion in LTE Network

South African mobile operator Cell C has said it will invest ZAR 8 billion (US $667 million) in building an LTE network over the next three years as it seeks to improve its position in the country’s highly competitive market. Cell C is South Africa’s third-largest operator. The MNO, which has partnered with Chinese vendors Huawei and ZTE as its primary network equipment suppliers, plans to deploy more than 4,000 LTE sites; however, it will continue to use 3G service in the country’s less populated areas. According to Cell C CEO Jose Dos Santos, the operator wants to ensure that every LTE site is linked to its fiber backbone in order to provide customers with the highest level of service.

South Africa’s dynamic mobile market has one of the most robust mobile broadband infrastructures on the continent, despite its lack of LTE licensing due to a year’s delay in spectrum allocation. According to recent reports, all of South Africa’s operators have been making heavy investments in mobile networks. In addition to Cell C’s ZAR 8 billion deployment, Vodacom, which has the largest number of LTE sites (about 2,000 stations), is investing ZAR 8.5 billion (US $708 million) in its network. MTN currently has 1,000 LTE sites and it is investing ZAR 10 billion (US $833 million) to improve its grid. This amount almost doubles MTN’s capex in 2014. Telkom has around 1,300 LTE sites and a very extensive fiber network.

We believe it is not only smart but also necessary for Cell C to invest in LTE infrastructure. As the demand for data services continues to increase in South Africa, we will not be surprised to see all of the country’s operators making further investments. As South African consumers experience their first access to the internet, spurred by the uptake of affordable smartphones, and learn that mobile data can be used to access financial services as well as information and entertainment content, their demands for larger data packages are increasing. Additionally, South Africans’ increased use of OTT services has led to the need for larger data allowances. While mobile packages that satisfy users’ demands for larger data allowances will bring in revenue for the country’s operators, there is the risk that this demand will outpace investment. So while Cell C is trying to bring its level of LTE deployment up to that of South Africa’s other major MNOs, its strategic rollout, particularly in heavily populated urban areas, is a good way to justify and receive a better rate of return on its investment. As time progresses the country’s operators may engage in network sharing as a way to build out infrastructure in rural areas.

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues or to speak with the research team: Click here.

Telkom Ramps Up Support Solutions for SMB Sector

South African operator Telkom has made the delivery of accessible and value-adding functionality for information and communications technology (ICT) systems specifically tailored to small and medium-sized businesses (SMBs) a priority for 2015. The operator considers the SMB sector to be a leading contributor to the country’s economic growth. Telkom plans to provide converged offerings of fixed, mobile, data, cloud and IT solutions to its business customers. According to Thami Magazi, managing executive of Telkom’s SMB service division, the products that are being developed will go a long way in enhancing efforts aimed at bringing the second economy into the first. In other words, helping these businesses grow will result in less of a disparity between South Africa’s wealthiest and poorest people.

As we have written previously, the telecom industry plays a major role in the economic growth of developing countries. In this environment, Telkom will most likely create new revenue sources with the creation of services for SMBs. As the country’s incumbent fixed line provider, but smallest mobile operator, Telkom is wise to expand its offerings for SMBs. From recent reports, it appears that all of South Africa’s operators have begun to follow a dual strategy of fixed and mobile. Its second-largest national operator, Neotel, has been gaining market share in the fixed line sector, and Vodacom, the country’s largest mobile operator, is awaiting final approval for its planned acquisition of it. The government has created Broadband InfraCo, a national infrastructure company, to provide inexpensive backbone network capacity to service providers. Additionally, Vodacom and MTN have moved into the fixed line and national fiber sector under a converged, service-neutral licensing arrangement, and lastly all of the major players have access to the various international submarine fiber optic cables that are now available in the county. While fixed line is still a small sector in South Africa, these recent events make it a competitive one and Telkom is smart to focus on new services for its business customers, not only to produce new revenue but also as a way to remain as the country’s fixed line leader.

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues or to speak with the research team: http://www.tarifica.com/contactus.aspx

South African Startup Offers Unlimited Data Package

A new South African company, DATA SIM, has launched a data-only SIM card offering, with unlimited internet browsing, social media access, Skype calling, and file downloads, for ZAR 149.00 (US $12.93) per month. The service is available on a month-to-month basis, with no contract, and there is no throttling of data speeds. The SIM cards also allow tethering but block certain services such as YouTube and movie and music downloads. DATA SIM claims that its service is provided via MTN’s 3G and LTE networks, although MTN has denied that it has any relationship with the company. In a statement to a South African news website, MyBroadband, DATA SIM founder Saeed Moosa said that his company has partnered with an unnamed entity that has an MTN access point name (APN). As data overtakes voice and SMS as the key mobile commodity, demand for data-only offerings is on the rise. Especially in developing markets, data SIMs are very attractive due to their low prices and flexibility. By offering unlimited, un-throttled access, DATA SIM is presenting consumers with an appealing product, and its aggressive pricing could very well establish a niche in the marketplace for the new company. The high data speeds are achieved at least in part by eliminating certain services that can use too much bandwidth. The low price, however, appears to have been achieved by a strategy that is innovative but risky—the use of a third-party reseller to gain access to the network of a major MNO. MTN South Africa’s chief enterprise officer, Alpheus Mangale, said, “MTN can categorically state that it has no working relationship with this entity [DATA SIM], and neither has it endorsed a product offered by this company,” and advised consumers to exercise caution before subscribing to DATA SIM. So even if the use of a reseller’s APN turns out to be free of any legal complications, DATA SIM may have trouble attracting enough customers if MTN’s warning is taken seriously by the South African public. The above item appeared in a recent issue of Tarifica's "The Story of The Week", a weekly report that analyzes noteworthy developments in the telecoms industry from around the world. For past issues or to learn more about The Story of The Week or to contact the Tarifica Research department:  http://www.tarifica.com/contactus.aspx

Global Developments in Telecommunication

Asia/Pacific

Singaporean operator StarHub has partnered with multinational social ebook reading service Bookmate to offer StarHub customers a book streaming service of over 500,000 ebooks from 600 publishers. Users need to download the Bookmate app for iOS or Android and can subscribe to either the Standard tier or Premium tier service. The Standard tier, which costs SGD 9.98 (US $7.61) per month, provides fiction and non-fiction titles. The Premium tier’s monthly cost of SGD 15.98 (US $12.19) adds business and professional books.

Europe

From early 2015, French mobile operator Bouygues Telecom will offer Sweden-based Spotify’s music streaming service to subscribers of its higher-end mobile plans. Through its Spotify offerings, Bouygues Telecom is trying to introduce more customers to its 4G service and encourage them to switch to larger data packages.

Latin America

Brazilian mobile operator Oi has reached the 1 million mark for the deployment of Wi-Fi hotspots across Brazil. This represents a 112 percent year-over-year increase over the number of hotspots deployed at the end of 2013. Users can connect to Oi’s Wi-Fi network via the operator’s Wi-Fi app, which they can download at no cost for iOS and Android. Oi’s hotspots are located in restaurants, airports, shopping malls, public places and tourism sites.

Middle East/Africa

The Cameroonian government has partnered with mobile operators MTN and Orange to launch a tax service called Mobile Tax. The service will enable those of Cameroon’s taxpayers who are subscribers to either operator to pay their property taxes through mobile money accounts. The government has experienced a good deal of property tax evasion. While property taxes will be the first type of taxes that can be paid through mobile money accounts, the Cameroonian government will eventually expand Mobile Tax to enable users to pay all types of Cameroon’s taxes.

North America

U.S. regional mobile operator C Spire has introduced Pay-As-You-Go Rolling Data plans, which will enable its subscribers to roll over any unused data—up to the plan maximum—to use during the following month. The plan’s monthly costs are US $40.00, US $55.00 and US $65.00 for 2 GB, 4 GB and 6 GB of rolling data, respectively.  All plans include unlimited voice minutes and SMS.

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues or to speak with the research team: http://www.tarifica.com/contactus.aspx

Telkom Expanding Lead in Plans’ Consumer Value

A new Tarifica study shows Telkom expanding its lead over competing mobile operators in terms of providing the most consumer value for contract plans in South Africa. The results are based on value as measured by the Tarifica Score™, a proprietary algorithm that comprehensively weighs every feature of a mobile plan (including usage allotments, geographic coverage, data speeds, value added features and promotional elements) against the plan’s total costs in order to determine its precise consumer value relative to all other offers in the market. Scores range from 0 (worst) to 100 (best). The Tarifica Score™ was first deployed in South Africa in July 2014 and has been used to rank every contract mobile plan on a monthly basis since.  

After scoring is completed, plans are divided into two categories, “With Phone” and “SIM Only”,   then subdivided into five price segments, creating a total of 10 groups. Of these groups, Telkom’s plans led the field in October, achieving Tarifica “Top Value Plan” status in five groups. Cell C rated second best, winning three of the 10 price segments. MTN and Virgin Mobile were each able to earn just one “Top Value Plan” while Vodacom, after offering the top overall SIM Only plan in the market a mere two months ago, was shut out entirely. 

Commenting on the most notable development in the market during October, Melissa Mascarenhas, Tarifica’s South Africa Analyst, stated, “The addition of unlimited on-net data to Telkom’s SmartPlan 100, 200 and 500 plans with the purchase of a phone considerably enhanced the already solid consumer value of these offers. There simply is no similarly priced alternative in South Africa that includes the volume of allowances available with these plans. Given that Telkom already had the top Tarifica Scores in September, this new promotion served to further expand the operator’s lead.” 

“In today’s mobile marketplace, consumers are flooded with hundreds of plan variations and constantly shifting promotions and deals—the majority of which come with different costs and services and access networks of differing strengths. When making a decision that will likely impact them for up to two years, consumers can use Tarifica Scores to cut through the clutter and identify those plans in every market segment that offer the best value for the money,” stated Tarifica Program Manager, Will Watts.

To Contact Tarifica's Research Team:   http://www.tarifica.com/contactus.aspx

MTN Calls for Collaboration With OTT Players

African mobile operator MTN has called for collaboration between MNOs and over-the-top (OTT) players. MTN CEO Ahmad Farroukh, speaking at the AfricaCom event in South Africa, said that cooperation is required to develop a win-win ecosystem, as operators cannot be in complete control of the internet, and a broadband pipe that lacks appealing content and applications means little to end users. Farroukh said that mobile network operators and OTT players can either fight each other or opt to work in partnership to define access and structure a fair deal for both parties. He suggested, for example, that operators charge for value-added services and quality of service. Those that want a premium service will be willing to pay a premium, Farroukh said. He told delegates that mobile operators need to put a plan in place to avoid being forced into the role of providing a “dumb pipe,” investing to provide the network infrastructure while allowing OTT providers to own the customer and make money in the future. To be truly successful, according to Farroukh, OTT players and mobile operators have to each look beyond their own customer base and leverage global reach. He said that partnerships will play an important role in this process. Strategically positioned OTT players cooperating with mobile operators can also deepen the relationship between customers and the operator brand, build loyalty, reduce churn and help improve the customer value proposition. A little over six weeks ago, Ahmad Farroukh sounded a more combative note in remarks delivered to reporters. In late September, he characterized the relationship between OTTs and MNOs as “unfair,” in that the latter spend large amounts of money creating and maintaining mobile networks that OTTs then use to take business away from them. He criticized South African competitor Cell C’s decision to offer its customers free data for OTT messaging app WhatsApp, arguing that such a strategy amounts to giving away the store. Without giving specifics, Farroukh seemed to calling for MNOs to exact some sort of concessions from OTTs in return for access to their networks, without actually denying them access. Now, the MTN CEO appears to have backtracked to some extent, emphasizing cooperation and partnership between MNOs and OTTs rather than the application of pressure (a strategy that Tarifica also advocated in recent remarks delivered at the Pricing Mobile Data Conference in London). Perhaps he has come to accept that MNOs do not really have enough leverage to really fight OTTs and is urging conciliation rather than combat. However, reading between the lines a little bit, his latest remarks can be construed as being in no fundamental way inconsistent with what he said earlier. While cooperation and co-branding may help save MNOs from inhabiting the “dumb pipe” role, MNOs, Farroukh says, should nonetheless charge OTTs for “quality of service.” If they can indeed get OTTs to pay some sort of premium for access to premium network speeds and bandwidth, they will have made progress toward redressing the imbalance of fairness that Farroukh alluded to previously.

To Contact Tarifica: http://www.tarifica.com/contactus.aspx