Mobile operator Cell C has picked up on the general disgruntlement among customers of MTN and Vodacom, who raised a stink earlier in the year when they found their contract prices were raised before the contract ran out. It’s just launched a new Epic contract offer which it says will guarantee prices for two years, and what’s more they’ll give up to R10 000 to take one out.
Cell C did however, introduce new voice and data tariffs at the start of the year. Among the changes, it discontinued the entire SmartChat product range, and hiked the contract prices of Straight Up package.
The money on the table is available, says CEO Jose dos Santos, to buy potential customers out of their existing contracts with competitor networks. It’s part of a new strategy which will see the company try to build the number of contract customers it has.
“We’ve taken the fight to MTN over prepay in the past,” do Santos told a press conference this morning, “Now we’re going to give Vodacom a good smack”.
During the briefing, dos Santos’ colleague Robert Pasley revealed some details of the company’s current financials. In the limited expose – Cell C is a privately owned business and under no obligation to publish results – Pasley said that the firm currently has 17.7 million prepaid customers and 2.2 million on contract.
Revenue from prepaid customers has risen by 17% year on year in the first quarter this year, Pasley said, and represent around 35% of all revenues. Contract revenues were flat, but data revenues jumped by 59% and now represent nearly a third of all revenues.
dos Santos said that the number of smartphones on the network was rising sharply, largely due to second hand and hand-me-down models finding their way into the prepaid market.
Overall revenues were down, Pasley said, mostly due to lower termination rates – but at the same time operating costs were lower for the same reason.
According to dos Santos, some 1 335 new LTE sites will come online over the next few months, taking the total number of sites operated by Cell C to almost 5 000. All new sites will be connected to the network backbone with fibre, and dos Santos confirmed that the company is currently ending its roaming agreements with Vodacom and aiming for national coverage.
dos Santos also took a swipe at the current state of the National Broadband Policy, urging government to adopt a constortium led model for the rollout of a national broadband network rather than handing it over to Telkom for development.
“Where is Telkom going to get the R9bn necessary for a national broadband network,” he said, “We need to incentivise international investment and local companies to come in and build, it will take two years.”