Tuesday, July 25, 2017

Zimbabwe Mobile Industry Generates $200m in Revenue
By Taurai Mangudhla

Zimbabwe's mobile network industry has grown to become a significant sector of the economy, generating close to $200 million in quarterly revenues and a sizable profits for the three network operators.

The recent acquisition of Telecel Zimbabwe by the Government and successful completion of a $220 million network expansion exercise by state-owned NetOne has changed the industry's landscape.

The two Government owned players are battling against listed Econet Wireless which accounts for close to 50 percent of the 12,7 million active subscribers as of March 2017. The new turf has been around data and other additional products such as mobile money and other initiatives.

Telecel, the smallest mobile network provider, has increased its share of postpaid subscribers, defying the odds in a market reeling from dwindling disposable income among subscribers. It reported a 13,1 percent growth in post-paid customers to 18 326 active subscribers in the first quarter of the year compared to the same period prior year due to its ability to renew interest, through product innovation, among corporate clients.

Going forward, the company's fight for growth hinges on initiatives such as a focus on contract customers.

"The increase in our post-paid base is attributed to the flexibility of our product range and strategic targeting of corporate and SME clients using tailor made products like Telecel Business and Telecel Red," Telecel told the Herald Business.

"Apart from the user friendly business and high value products on offer our High Value team and customer care centres attend for the needs of our customers quickly and efficiently ensuring an improved overall customer experience. We have also seen many corporate customers coming back to Telecel as market confidence in the organisation increases," Telecel added.

In the period under review, Telecel reported a 1,1 percent decline in active subscribers to 1 785 321.

The decline in the subscriber base numbers was largely a result of a routine number range clean up exercise through a rationalsation of the subscriber base by removing inactive numbers, Telecel said.

The company was not spared by from an average 9,7 percent decline in revenues by mobile operators to $179,8 million from $199,2 million recorded in the previous quarter. The revenue decline, Telecel said, was driven by a fall in the usage of voice and SMS.

Although data revenues have been growing across the industry, the loses in voice and SMS revenues outweighed the positive performance. Voice declined by 4,7 percent at Telecel as the penetration mobile data usage and Over The Top (OTT) applications like WhatsApp over traditional voice and SMS grew.

"This trend is universal across all mobile network operators and as Telecel our approach is to embrace the emergence of OTTs and monetise the growing demand for them by customers through affordable products and service plans," Telecel said.

"Voice will continue to be a key component of Telecel's revenue base and as we move towards stabilising this key driver along with other revenue streams we are looking at ensuring that we continue to run a dynamic business model that focuses on network optimisation, service quality, tariff innovation, and creative offerings," Telecel added.

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