Telecom market sentiments change

Dar es Salaam. Until last year, the telecommunication market was basically a field for five major players, with Vodacom, Airtel and Tigo dominating.

During those days, the coming of new players could, in no way, be seen as a serious threat to the three established firms.

The sudden death of Dovetel, which traded as Sasatel, Excellentcom which would have traded as Hits and with the sudden demise of Benson Informatics, very few would have fathomed that new players like Vietel (which trades as Halotel) and Smart would give the established operators a run for their money.

But latest figures by Tanzania Communications Regulatory Authority (TCRA) point to the fact that the market sentiments are changing.

The operators registered a total of 2.787 million new Subscriber Identification Module (Sim) cards during the last quarter of 2015 to snatch a combined seven per cent market share from the established players.

For instance, Halotel- which officially started its operations in the country towards late last year – acquired 793,383 new subscribers during the last quarter of 2015.

This brought the total number of the company’s live Sim cards to 1,226,678 at the end of December 2015.

However, these figures are nothing to amuse the established operators, with Vodacom – whose subscription market share has gone down from 45 per cent in December 2007 to 32 per cent in December 2015 – saying though any new player may be a threat, a change in strategy, with a particular focus on other revenue generating streams, would see them remaining on top of others.

“New players in the market are a threat but as far as we have good strategies in our business, we have all what it takes to maintain our status as leaders in the industry,” Vodacom Tanzania chief executive officer Ian Ferrao told The Citizen recently.

In a bid to remain on top, the company is now focusing on strengthening its M-Pesa and data services.

It has lowered its M-Pesa transaction costs by up to 40 per cent when transferring any amount not exceeding Sh40,000, said Mr Ferrao

It has over 85,000 M-Pesa agents countrywide, transacting a total of Sh2 trillion through M-Pesa per month.

Airtel’s public relations manager, Mr Jackson Mmbando believes the new players have little to bother them since all existing operators have their own targeted audience.

“Halotel has its own targeted audience and so is Airtel and this means that the players are not a threat to us,” Mr Mmbando told The Citizen.

Airtel posted 32,839 new Sim cards during the three months ending December 2015. It had a total of 11,047,505 new subscribers to occupy the third slot in a market of 39.8 million live Sim cards. And, according to Mr Mmbando, the company now focuses on making its services more – particularly, internet, call and short messaging service bundles as well as Airtel money transactions.

“Our success story is always chained to good services, affordability, nationwide coverage, use of latest technology, innovation and being close to the customers,” he said.

As for MIC Tanzania Limited – which trades as Tigo, it is all smiles as the company’s live Sim cards has been on the increase during the past few years to the extent that it now occupies the second position in terms subscription.

The company accounted for 34 per cent – or 488,866 of the new subscribers during the last quarter of 2015.

Tigo’s general manager, Mr Diego Gutierrez believes the company’s growth during the past few years has been fuelled by a number of innovative factors. “The company’s success story is anchored in good service, affordability, nationwide coverage, use of latest technology, innovation and being close to customers,” Mr Gutierrez told The Citizen yesterday.

Some of the innovative products that are driving the growth, according to Mr Gutierrez, include a number of applications such as interoperability, banking integration, international money transfer and the Tigo Pesa quarterly profit share scheme. “We also have the digital inclusion initiatives which include free access to the social media initiative, our Facebook in Kiswahili product, Smartphone with menu in Kiswahili and the free WhatsApp which we launched two months ago,” he said.

The company, according to Mr Gutierrez, is investing a total of $120 million this year in a number of areas that seek to increase area coverage and improve its services.

The company’s Fourth Generation/Long Term Evolution (4G/LTE) technology has so far been rolled out to a total of six regions in the country as plans are on the cards to make sure that it reaches capitals for all of Tanzania’s regions by the end of this year.