Vodacom’s total customers at 117m as data subscription base rises
MOBILE operator Vodacom upped its data subscription base, adding new customers during the quarter to the end of December.
The increase saw the mobile operator increasing its total customer base to 117 million, setting the scene for what its operations could look like beyond the connectivity price wars.
Chief executive Shameel Joosub said yesterday that the group’s investment programme on customer experiences in all the countries it operated continued to yield results
“This is reflected in the additional 2 million customers that we connected during the quarter, contributing to growth of 6.6 percent in revenue for the Vodacom Group,” Joosub said.
Vodacom now serves more than 117 million customers across the group.
Joosub said growth trends improved across a number of metrics in South Africa following the significant impacts in the past year from their pricing transformation strategy.
“These included substantial cuts in out-of bundle tariffs and lower bundle prices, resulting in a 50 percent decline in effective data prices since March 2016,” he said.
Mobile operators in South Africa have been under pressure after the Competition Commission ordered them to reduce mobile data prices by up to 50 percent in the next two months or risk being prosecuted.
The decision came after other regulations forced the operators to roll over unused data.
Vodacom added 484 000 customers during the quarter, pushing its revenue 6.6 percent to R23.63 billion. Service revenue rose 4.6 percent. Joosub said the company’s highly successful summer campaign delivered 334 million free rewards and contributed to an uplift in activity across their customer base.
He said that data customers increased 12.5 percent to 22.9 million and overall data usage rose by 63.2 percent. Data bundles sales also inched up 20 percent to 251 million.
“This increase in data customers and usage is evidence of our success in transforming data pricing in South Africa. I am particularly pleased with the consistency in the performance of our international portfolio, which produced solid results on the back of strong demand for data and M-Pesa services, resulting in a 9 percent growth in service revenue,” he said.
Vodacom operations outside South Africa now contribute more than 40 percent to the group service revenue. In January, Vodacom had to disconnect 1.7 million customers in Tanzania as a result of customer registration requirements, primarily due to the lack of government approved identification documents.
“This will have an impact on our growth in Tanzania. However, we expect to reconnect many of these customers in the short to medium term once biometrically registered,” Joosub said.
The group said customers can expect to experience the benefit of its revised roaming deal with Rain, to expand its 4G capacity further.
Vodacom shares declined 1.03 percent on the JSE yesterday to close at R116.32.