19 May 2009

Operators working on their network performance in South Africa

Competition is increasing in African markets, and added to the threat of lower consumer spend due to the global economic downturn, operators need to look at how they can best differentiate. In some cases, particularly for incumbents and market leaders, network capacity and high quality of service is a strong asset for both customer acquisition and retention.
That may be the reason why MTN is so strongly supporting the move of South African regulator ICASA 's decision to make operators publish quarterly reports on their performance. South Africa’s mobile operators MTN, Cell C and Vodacom met with ICASA last week to discuss the terms of the agreement. As a result, they will have to publicly report on: network performance and availability, network parameters (including reports about dropped calls and delayed text messages) and Active Subscriber Information. ICASA’s move is “part of the broader investigation about the source of dropped calls and the delayed SMSs that cell phone subscribers have been experiencing recently”. Apparently, SMS delays became a major issue during a reality TV programme involving text voting (a sign that the reality TV format is still alive and well across the globe!).
MTN was quick to turn the decision to their advantage, with representative Tim Lowry commenting publicly on it (Lowry is MD for the South Africa operation, regional VP for Southern and Eastern Africa at group level, and a regular speaker at the AfricaCom congress). According to MTN, ICASA’s decision was based on their proposal, described as similar to the way listed companies have to report on their financial performance. A great PR move for an operator which is investing heavily on its networks across Africa this year, as mentioned in a previous post. They will undoubtedly want to avoid the situation they experienced in Nigeria last year, when the local regulator threatened to block all new subscription additions until the QOS issues were sorted.
Tim Lowry’s comments also included a snap at Telkom, saying that the most consistent area of failure occurred when its network was relying on link faults by the fixed operator. His comment was quickly picked up by Telkom’s people, who released a statement saying “Telkom rejects the claims made by Lowry where he reportedly blamed the company for their own network and capacity shortcomings as an attempt to deflect attention from MTN’s own failure to adequately service its customers”.
We’ll just have to wait and see if Telkom is asked to share its network performance too to settle the debate. In the meantime, let’s hope South African viewers get to vote safely for their favourite TV show!