MTN joins price hike train

As industry watchers predicted, MTN has followed the "trend" of upping mobile rates.

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MTN has become the latest operator to announce price hikes, to its subscription fees for contract customers and prepaid data bundles.

This comes, as predicted by industry watchers, in the wake of both Cell C and Vodacom hiking their prices in sudden turnaround moves that have elicited the ire of consumers.

Yesterday MTN SA marketing chief Larry Annetts said the operator "strives to remain competitive" and indicated the company would make an announcement "at an appropriate time" regarding its plans on pricing.

In a media statement sent out today, the operator says: "MTN's prices have been relatively stable despite the challenging economic environment and the substantial investment MTN has made on its network.

"In 2014, MTN underwent a process of reviewing its operations which was aimed at increasing efficiencies and reviewing its costs. This exercise was aimed at mitigating the impact of the challenging environment MTN operates in. The reduction in mobile termination rates, coupled with the increased costs of network investment, has necessitated a review of pricing."

MTN notes it has not increased contract subscription prices for over a decade "despite rising operational costs, distribution costs, transport costs, handset price increases, infrastructural costs, falling exchange rates and an increase in taxes".

The company adds that, recently, it has had to invest substantially in generators and back-up batteries to power its base stations during power outages. "All these cumulative costs have compelled the operator to review its pricing as the last resort.

"In accordance with the Consumer Protection Act and MTN's subscriber agreement terms and conditions, MTN will give its subscribers 20 working days' notice prior to effecting the price changes for contract customers."

ITWeb is awaiting details of MTN's price increase margins. Vodacom's contract subscriptions are set to go up by an average of 5%, an increase that will affect about two-thirds of its contract subscribers.