Vodacom barely caused a ripple with its announcement last month that it would start subsidising computers in the same way it has cellphones in an effort to increase data use on its network.
Beaming from a 19,5% leap in profit to R27, 3-billion and dividends of 61,9% to R3, 4-billion in the year to March, Vodacom is also hoping to boost its data traffic. Vodacom’s data revenue increased 29,1% to R1,3-billion, but mainly due to growth in SMS traffic. It carried 2,4-billion SMSs over its South African network during the year ended March, up 25,2% from the previous year.
The country’s largest cellular network operator is hoping to capitalise on its third-generation (3G) data services, cognisant that voice subscribers will eventually dry up.
“We have to find additional revenue streams for the next few years when we reach saturation level,” chief operating officer Pieter Uys told the Mail & Guardian.
But to create more data users and to make full use of the Internet people need a computer, which is often too expensive. Hence the subsidy plan.
Uys last month demonstrated an enhancement to Vodacom’s 3G broadband service that will increase data speeds from 384 kilobytes per second to one megabyte per second. Dubbed “3G on steroids”, high-speed downlink packet access can eventually offer download speeds of 14 megabytes per second.
So while South Africans wait for the benefits of recently liberalised voice over internet p rotocol, the most immediate advantage might well be from the opposite direction in the form of cheaper and faster mobile data services.
After Vodacom dropped its data prices to R2 a megabyte in November, MTN and Cell C followed suit this year.
Telkom officials confirmed that it is investigating providing credit-approved customers with packages, including a computer, but that it won’t subsidise the entire package.