Mobile operators must step up their focus on data offerings if they want to stay alive in the market, says MTN.
Speaking exclusively to ITWeb, MTN SA MD Karel Pienaar said that, without a compelling data offering, mobile companies are “dead in the water”.
Over the last few months, SA's Internet landscape has seen some dramatic changes, not in the least a wireline (ADSL) bandwidth price war, which seems to have passed the mobile operators by.
MTN has been slightly ahead of its mobile competitors on producing a rate cut on its mobile offering; however, Pienaar admits these drops need to be more compelling. “We are having to really make significant investments in upgrades for data now,” he adds.
Telecoms operators have long been pegged as the possible leaders of the Internet space, since mobile devices with Internet access are so prolific among the South African population. Across the continent, the mobile solution is more popular than wired products.
International Telecommunication Union figures show fixed-line access currently has around 3.9 million subscribers, while wireless access accounts for 4.2 million Africans. However, following MWeb's announcement last month, chased by a stream of bandwidth price cuts, mobile operators were left reeling.
Catching up
According to MTN, the company's recovery on the investments it has made in data will take time to recoup, which is why the current offerings are priced as they are. Pienaar says as people start using the cabled and base-station services, the prices will drop more.
The operator recently hacked its out-of-bundle data prices by 84% and introduced a time-based Internet package, and a semi-uncapped offering. However, Pienaar says there will be more to come as it receives the density it needs to lower the cost of use of the infrastructure it builds.
Getting there
Even with the slow start, Pienaar is adamant the mobile operators will become the definitive providers of broadband in the country. “In 10 years, everyone in SA will have Internet access, and I have no doubt about our competitiveness in this space,” he adds.
He likens MTN's broadband drive to the successes it has had in voice, saying mobiles will be able to reach 100% penetration in broadband as it has with mobile SIMs. “We need to get people on the Net, not just for our revenues, but for the economy of the country,” he adds.
MTN competitor Cell C has also recognised the need to join a growing Internet revolution in SA, and has plans to roll-out a high-speed data network. The announcement brings a new focus for the company that previously had little to do with the Internet space.
Vodacom has made more subtle moves, with it dialling up access speeds over the last few weeks, allowing all customers on its network to connect at 14.4Mbps.
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