Vodacom vs MTN vs Telkom vs Cell C – how much money mobile networks make per subscriber in South Africa

 ·17 Nov 2021

South Africa’s major mobile networks have published their financials for the most recent reporting period – revealing how much money they make per subscriber.

Two of the key metrics used by South Africa’s mobile networks to track results are subscriber numbers and ARPU (average revenue per user).

This ARPU figure is further split into how much money an operator makes from pre-paid subscribers and ‘post-paid’ or contract subscribers. Together, these two figures give a ‘blended ARPU’ number, which is effectively how much money an operator makes per subscriber.

MTN reported a subscriber base of 33.5 million in its quarterly update for the period ended 30 September 2021. Despite being substantially lower than its primary competitor, Vodacom, the group claims the most money per customer, with a blended ARPU of R98.

MTN’s post-paid customers contribute an ARPU of R255 per month, while the group reports a pre-paid ARPU of R76 per month – the highest among the four major networks.

Telkom reported a subscriber base of 16.3 million for the six months ended 30 September 2021. The group recorded a post-paid ARPU of R217 and a pre-paid ARPU of R67, bringing the blended ARPU to R92.

Vodacom was the latest mobile operator to publish its results, with the group reporting that it now has 45.4 million subscribers for the quarter ending 30 September 2021. The group recorded a post-paid ARPU of R299 and a pre-paid ARPU of R56, bringing the blended ARPU to R90.

At the end of October 2021, Cell C reported its financials for the six-month period to June 2021, showing that the group now has just under 12.9 million subscribers – a 10% increase compared to the first half of 2020 (11.7 million). The group reported a prepaid ARPU of R66 and a post-paid ARPU of R305 over the reporting period.

The table below outlines the ARPU for the four networks, including the subscriber numbers at the time of reporting.

Network Subscribers Pre-paid ARPU Post-paid ARPU Blended ARPU
MTN 33.5 million R76 R255 R98
Telkom 16.3 million R67 R217 R92
Vodacom 45.4 million R56 R299 R90
Cell C 12.9 million R66 R305 N/A

While the major operators do not provide a breakdown of how many customers are on which package, the post-paid figures are not totally reflective of what high-end South Africans can end up paying for a contract.

The most expensive contract deal available to purchase on Vodacom’s website shows that customers can spend more than R3,800 a month on a new top-end phone, bundled with a smartwatch and large data allocation.

Similarly, MTN offers an unlimited voice and data plan on some of its contracts, which can cost well over R3,000 a month.

Data and lockdown

All four operators have said that the lockdown restrictions have amplified demand for data in South Africa, with South Africans increasingly working and studying from home.

Regulator Icasa initially helped ease this burden by freeing up temporary spectrum to the operators during the lockdown period, but this is scheduled to end in the coming months.

“In the face of continued data demand and the uncertainty of the ongoing pandemic, we are encouraged by Icasa’s proposed licencing of provisional spectrum in South Africa,” Vodacom said in its results on 15 November.

“It is estimated that circa 10 million South Africans have benefitted from the service that operators have been able to provide as a result of the temporary spectrum allocation.”

Operators have also noted that the easing of lockdown restrictions and a return to the office is likely to result in more competition. In its results presentation on 4 November, MTN also warned that the country’s high unemployment rate could have an impact on mobile operators.

“South Africa, rising unemployment is a concern and may impact growth from prepaid customers in the lower-income segment in the near-term, if measures such as the temporary employee relief scheme (TERS) benefit are withdrawn.

“With the economy opening up and some prepaid customers now travelling to work, there is competition for share of wallet from other spend categories,” it said.

Read: MTN in takeover approach for Telkom: report

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