Showing the money
MTN has a digital plan that puts it in competition with large international brands
n pursuit of an ambitious digital strategy, MTN Group has invested in local and African versions of brands such as Amazon and Uber. It wants to style itself as an African online shopping company.
MTN is buying e-commerce companies through its stake in Africa Internet Holdings and Middle East Internet Holdings.
It is the only local mobile network operator to expand so purposefully into e-commerce.
MTN, which has a footprint spanning 22 countries, has set its sights beyond voice — whose share of telecoms revenue is shrinking — and even beyond data, which its rivals still see as the frontier of the sector’s growth.
IIt owns online platforms in financial services, music and video streaming, Internet TV, as well as online stores that sell footwear and clothes, and hotel and flight bookings. It also offers restaurant food delivery services, job sites, classifieds for car sales and a taxi service to rival Uber. It wants to extend that to include insurance and is piloting money lending in Cameroon, Uganda, Zambia and SA, to expand its mobile money service.
With its 240m customers in Africa and the Middle East, MTN Group head of digital Herman Singh says: “We can leapfrog to the front of digital e-commerce.
“We are in the fourth wave of evolution, which is digital,” he says.
Many people’s first experience of e-commerce on the rest of the continent is via their smartphones. Unlike in SA, Singh says other African countries “will never see the emergence of malls”.
MTN’s e-commerce is available beyond the list of countries where one can purchase an MTN Sim card.
Some e-commerce platforms are available in Egypt, Tanzania, Saudi Arabia and Kenya, and are offered through partnerships with other network operators. In Saudi Arabia, for example, its taxi-hailing business is one of the country’s top three. Plans are under way to launch Internet TV there, as well as in Cyprus and Iran.
MTN has build a technology platform that enables its e-commerce sites and other digital services to have a common backend. This implies single billing, which in future will make it easier for the entities to crosssell their products.
Its customers could use Travelstart to book flights, Jovago for hotels and book a ride from the airport using Easy Taxi. To pay the bill, its customers can use its mobile money platform.
MTN’s digital business could soon be valued at $1bn, with the largest contribution coming from music and also mobile financial services.
It hasn’t all been plain sailing. MTN first launched a mobile money service in 2004 in SA in partnership with Standard Bank and later in other countries. Two years ago it relaunched the service in SA in partnership with Pick n Pay.
But SA CEO Mteto Nyati