Vodacom Group CEO , Shameel Joosub, has dismissed Cell C’s new campaign to buy out its rival’s subscribers by paying them up to R10,000, calling it a “marketing gimmick”.<\/p>\n
On Monday, Vodacom Group reported a 2.7% drop in service revenue to R47 billion for its South African operation during the year ended March 2015, impacted by a 50% cut in mobile termination rates (MTRs).<\/p>\n
The group did manage to grow prepaid active customers in SA by 1.8% to 27.2 million, while contract active customers, excluding M2M, increased 2.5% to 4.9 million.<\/p>\n
Joosub however, said that the reporting period was the toughest the group had ever faced.<\/p>\n
\u201cThe key highlights of our story for the year were network investment, data growth, and pricing transformation.”<\/p>\n
“This played out against a tough backdrop. In South Africa we faced major cuts in mobile termination rates, a weak economic environment, exchange rate volatility and increased price competition,” he said.<\/p>\n
Last week, South Africa\u2019s third largest mobile operator, Cell C said it will pay new customers up to R10,000 to cancel their contract with rival operators including Vodacom and MTN.<\/p>\n
\u201cWe will buy your contract out to the value of R10,000\u201d said CEO Jose Dos Santos. \u201cNow we are going to give Vodacom a good smack,\u201d he told journalists at the company\u2019s head office Johannesburg.<\/p>\n
Joosub retorted, saying that he was not overly concerned by Cell C’s initiative, calling it a marketing gimmick:\u00a0“It presumes that customers want to leave.”<\/p>\n
He said that the impact of such a move “will be very small” adding: “we aren’t going to roll over and play dead”.<\/p>\n
Joosub said that all operators in South Africa were under pressure, but pointed to growth in data as a means to future momentum.<\/p>\n
Cell C will pay you R10,000 to cancel your contract with Vodacom and MTN<\/a><\/strong><\/p>\n