HomeOld_PostsIt’s dog-eat-dog in the telecoms sector

It’s dog-eat-dog in the telecoms sector

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COMPETITION in the telecommunications industry is forcing operators to reduce prices and introduce enticing packages as they battle for customers.
In the face of liquidity crunch, slowing consumer demand, tariff reduction and the substitution of traditional mobile services with over-the-top (OTT) applications such as whatsapp and facebook, prices are coming down across the industry.
OTT is defined as the delivery of video, audio and other media form from a third party to a mobile phone which leaves the mobile phone network only responsible for routing messages.
Competition is getting stiff with each passing week.
The scramble for customers is leading to significant price cuts from operators as part of efforts to maintain or increase their market share.
Companies are also trying to stimulate demand and counter stiff competition.
In the past five months, telecommunication operators have launched more than 20 packages that seek to offer more for less.
Last month, NetOne launched a new home WiFi product called One-FI described by acting chief executive officer Brian Mutandiro as meant to ‘meet the ever-changing needs of our consumers and the insatiable quest for innovative technologies’.
Since January this year, this is the sixth new product from NetOne as it seeks to lure many consumers.
Last year, NetOne also introduced an integrated prepaid package called OneFusion, which gives subscribers a comprehensive communications plan, with bundles for on-net and off-net minutes, data, sms, whatsapp, facebook, twitter and international minutes.
NetOne’s internet package, OneFusion, has been a game-changer for the operator with a minimum package of US$5 which caters for the monthly needs of a subscriber.
This package saw massive migration of consumers from other mobile networks to NetOne.
Data from POTRAZ show that in 2016, NetOne added 577 690 new active subscribers, while Econet and Telecel’s numbers declined by 341 787 and 114 387 respectively.
The growth in active subscribers saw NetOne’s market share increasing to 36,6 percent in the fourth quarter ended December 31 up from 36,4 percent in the previous quarter.
To counter the competition, other telecommunication operators are sharpening their pencils, bringing innovative packages to the table.
Just a week after NetOne’s OneFi’s launch, Econet, the country’s largest mobile network operator launched Econet Zone Mobile WiFi on the go, which gives internet access to commuter omnibus passengers on selected metropolitan routes.
Econet Zone Mobile WiFi on-the go is a service enabling subscribers to use WiFi when travelling in a Kombi.
“We are keenly aware of the important role that access to internet has, not only to our lifestyles, but to the development of today’s society in line with our commitment to meeting Sustainable Development Goals,” said Econet chief executive officer Douglas Mboweni.
“Through our services, we want to give or customers’ value, convenience, access and choice.”
And Telecel Zimbabwe has not been left out in the race.
A few days after, Telecel launched its WiFi Zone service, which allows subscribers to connect to internet via WiFi hotspots using their mobile phones or any other WiFi compatible devices. Telecel launched more than 70 WiFi hotspots.
Telecel is, however, entering a market that is already dominated by internet service provider ZOL.
ZOL currently has 670 hotspots around the country.
The internet service provider recently slashed prices for its capped fibroniks packages which includes moving up the roof of the packages.
For instance, the cheapest package which was previously priced at US$29 for 15GB has seen the cap pushed to 25GB for the same price.
In March, ZOL launched a product whose speed, chief executive Denny Marandure said, brings internet speed that equals ‘a cheetah driving a Ferrari’.
Marandure said Zimbabwe cannot ignore the internet of things but this can only be achieved by super-fast FibroniksFast speeds.
ZOL has also introduced ‘Night Owl’ which is an optional off-peak pricing for browsing between 11pm and 6am.
The Night Owl packages start at US$6 for 25GB essentially making ZOL Fibroniks the cheapest broadband connection in the country.
This month a new package is expected to be launched by TelOne. TelOne is in the final stages of launching a video streaming broadband for its ADSL and fibre customers.
The package will allow TelOne customers to stream movies by paying for streaming in addition to the regular packages.
“The pricing pressure is bound to continue as consumers are now demanding more for less; this is the reality telecommunications operators in Zimbabwe are already experiencing as they compete for customers,” said TelOne managing director Chipo Mutasa.
The stick is now left with Africom, another local internet provider, which is yet to introduce new packages since 2015.
Africom has maintained the MiChoice tag for its internet bundles, with the packages falling into three categories- MiChoice Unlimited, MiChoice Regular and MiChoice night Browser.
Last week, its subscribers switched on to new Subscriber Identity Module (SIM) cards after POTRAZ, the national telecommunications regulator snapped up the huge chunk which Africom was sitting on as they re-allocate frequency, to accommodate more 4th Generation (4G) players and Long-Term Evolution (LTE) players.
For the past years, Africom has been enjoying a 800mhz frequency, the only range that has 4G speeds possibilities over long distances.
Africom had 4G possibilities of one base station beaming between 15 to 21km whereas mobile network operators in Zimbabwe under Global System for Mobile communication (GSM) frequency 1800 -2100 beam a maximum of three-to-four km per base station.
However, this move means more aggressive competition to them as many players can now broadcast cheaply in their frequency range.
Its dog-eat-dog in the telecommunications sector.

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