MTN breaks five-million mark

Johannesburg, 21 Aug 2002

M-Cell, parent company of the MTN group, said yesterday it had broken the five million subscriber mark with a total of 5 078 000 at the end of June.

In a quarterly trading update to analysts, the company said it had 1 113 000 users in its operations in the rest of Africa, an increase of more than 24% since March.

In stark comparison, the flagship South African operation increased subscribers by only 6.4%. Much of that growth was in the prepaid sector, with growth in the crucial postpaid or contract base barely clearing 1%. Last year, SA contract subscribers on average spent more than R500 a month with the company, while prepaid users spent R100.

Despite a worldwide fight against declining average revenue per user (ARPU) as operators recruit clients who spend less, MTN says its local ARPU (prepaid and contract) remained steady at R208 a month.

"While postpaid ARPU has increased, prepaid ARPU declined during the first quarter," it says. MTN is focusing on data and other value-added services in an effort to increase contract spending.

Spending in the other countries where it is active continues to vary wildly. In Nigeria, where it was recently under fire for what protestors called profiteering, the average customer spends $60, or more than R600 a month with MTN. Despite high prices, which the company attributes to the massive capital spending, Nigeria reported 454 000 subscribers, an increase of nearly 40% since end-March.

"The group remains well positioned to achieve its objective of generating around 35% of its revenue from operations outside SA within the next two years," says CEO Phuthuma Nhleko.