SMS revenue decline to continue: Vodacom

Vodacom CEO Shameel Joosub says that, while SMS revenue will continue to decline, it will do so at a slower rate than many mature markets in Europe.

Last Monday (12 November), Vodacom noted that SMS and MMS revenue suffered a decline for the first time, albeit marginally, by 0.2% to R1.53 billion for the six months ended September 2012.

According to an article featured in My Broadband last week, industry experts estimate that the true cost for an SMS to mobile operators is between 2c and 5c, meaning that retail costs of up to 80c per SMS provide a great source of profit for operators.

Vodacom’s chief executive said that the group had managed to counter the decline in SMS revenue somewhat through an integrated price plan.

He noted that the country was still under-penetrated in terms of SMS by as much as 57-58%, while in some European countries the decline in SMS revenue was as much as 20%.

Joosub said that the arrival of devices like BlackBerry, through its messenger service, had eaten away at the group’s messaging revenue. Vodacom has 2.7 million customers using BlackBerry handsets.

Looking ahead, the company lead said in a statement: “Governments and regulators are placing increasing emphasis on delivering ICT services for all to unlock growth potential. In order to achieve longterm sustainable growth we need to align the broader visions of our business to the vision of the countries that we operate in, while keeping the customer at the heart of it all.”

“Our strategy focuses on these sustainability challenges but also on the key growth drivers of data services, International operations, enterprise services and new financial and digital lifestyle services.”

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SMS revenue decline to continue: Vodacom