Customers teach Vodacom a lesson

Spare a thought for Vodacom customers! At least for those who forced Vodacom Group’s CEO, Shameel Joosub, to kinda eat humble pie.

In presenting trading statement for the quarter ended December, Joosub weaved in a comment which will certainly have many in stitches.

“While customers increased, voice revenue in South Africa was impacted by more active competition in a softer economy coupled with the decision taken earlier in the year to discourage calling card1 behaviour. This was the right thing to do to improve profitability but has temporarily impacted revenue growth”.

In a footnote, Vodacom explains further: “Calling card1 behaviour arises where airtime is bundled with a starterpack and sold at a discounted price by wholesalers. This results in customers acquiring the SIM cards solely for use of the discounted airtime and discarding the SIM once the airtime value has been utilised”.

This is just a sign that competition is getting tighter within South Africa’s telecom’s market pushing players into innovation overdrive. This is slippery ground.

 

 

 

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