A new mobile player is about to enter SA's dog-eat-dog telecoms market, where historically mobile virtual network operators (MVNO) have been eaten alive by established players with a dominant marketing presence - a scenario it hopes to change.
While details are still under wraps - including the new MVNO's name - the new player says the time is ripe for new players to come into the market to challenge the mobile industry status quo. "Consumers are desperate for better mobile choices."
The new player, which started a "BeUnordinary" teaser campaign on 15 April - including, so far, the erection of billboards on the Gautrain line and a social media teaser campaign via Twitter - will officially launch to SA's consumers on 4 May.
It promises SA's mobile consumers "freedom, flexibility, control and a cost-effective offering, minus the 24-month contract" and is captained by Brett Howell as CEO, who is using the services of former Virgin Mobile SA boss Steve Bailey's mobile virtual network enabler, MVN-X.
Formidable forces
While the time may seem opportune - given recent moves by SA's established mobile operators to up contract prices - analysts say opportunities are still limited.
World Wide Worx MD Arthur Goldstuck points out "a similar movie" played out with the launch of Virgin Mobile a decade ago. "It really did have a competitive and differentiated offering, but that counted for little against the massive marketing presence and infrastructure of the major operators."
Goldstuck says, however, that is not to say no other player should try, or that there is no way to compete. "We still await the offering that makes a breakthrough in meeting individualised market needs the way mass-based operators cannot."
Africa Analysis analyst Dobek Pater agrees that opportunity is limited, but says it depends on what is being offered and how. "Overall, the economy is depressed and this translates into lower discretionary spending budgets. The large operators have demonstrated they are willing to go into a price war in order to limit the potential expansion of smaller competitors.
"The market is saturated; therefore, any new operator will need to win customers away from the existing operators, which is relatively expensive."
Neil Buckley, owner of Apex Business Intelligence, adds price and brand loyalty alone are no longer enough to guarantee a place as a valued player in the telecoms space. "Consumers are looking for real value from a provider who has their interests front of mind and who can provide transparency and flexibility."
For a new player to make it in the market, says Buckley, it would need differentiation so clear cut and so unique that it literally offers life-enriching benefits to the end-user. "The MVNO would need to break the mould of what has become the norm within the mobile environment."
Snubbed consumers
Consumers have hit out at Vodacom, MTN and Cell C for increasing their contract prices for both new and existing customers - a move that has many vowing not to renew their current contracts.
However, with price increases set to become the new norm - deviating from the price war consumers had come to enjoy and expect - mobile customers are strapped for viable options.
Antony Seeff, CEO of cellphone bill analysis company Tariffic, says operators are still not answering their customers' concerns when it comes to flexible contract dates, reduced pricing, improved customer service, and transparency regarding tariffs, billing, and that 'free phone'. "If anyone manages to solve these common complaints - whether it be one of the existing providers or a new player - they should be able to unlock a decent share of the market."
A game-changer may be a different approach to the market whereby an operator offers a 24-month contract with flexible prices and included value, and then allows the user to bolt-on whatever phone they like, says Seeff.
He cautions, however, not all MVNOs are created equal and customers who want to jump ship to an MVNO solution should be aware of and comfortable with the underlying network. The new player would most likely utilise Cell C's network, as the operator has partnered with MVN-X, headed by Bailey, to offer enabling services for would-be MVNOs.
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