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MTN in full scale digital service drive as voice revenue plummets

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MTN, the largest telecommunications operator in Nigeria, Africa’s largest economy by GDP, is engaging in a full scale incursion into the digital business landscape, an industry estimated to generate $1trn by 2015.

This move, according to market observers, has become imperative in view of dwindling revenues from voice oriented services, and the need to maintain customer loyalty whilst delivering growth in the face of fierce competition. According to estimates, as at December 2012, the monthly Average Revenue Per User (ARPU) was N912 ($6), an 87.5 percent decrease from its 2003 level of N6,384 ($48).

The telecoms firm, with 60 million mobile customers, says it fully focusing on data, digital services and leveraging the power of the internet. Funmi Onajide, general manager, corporate affairs, MTN, confirmed the development at the launch of the company’s BetterMe campaign in Lagos.

“In the past the focus was on voice- that is the ability to connect people so that they could make phone calls. This industry has achieved that well over 100 million active subscribers in Nigeria of which MTN has 60 million mobile subscribers as at the end of 2014. That dispensation was Telco 1.5. Now, we are moving to Telco 2.0 which is characterised by full scale focus on data and digital services leveraging the power of the internet,” she said.

With Nigeria recording a 200-percent increase in internet users between 2009 and 2013, market observers are of the view that expansion of broadband infrastructure across the country is driving up adoption of digital services. The emergence of powerful new players that successfully leverage or bypass network operators such as Apple and Google, with their smartphone and applications ecosystem, has become a matter of grave concern for operators.

Matthew Reed, principal analyst, Middle East & Africa, for Informa, said “mobile operators are not only experiencing and seeking to further encourage a burgeoning demand for data, they are also looking to develop new offerings in areas such as mobile financial services, electronic commerce, mobile payment, digital media, such as music, gaming, and video, and enterprise services such as cloud and Machine-to-Machine (M2M)”.

In view of this, many telecoms companies are currently engaging in fresh initiatives, including acquisition of digital businesses and content distribution platforms. Others are forging stronger ties with the mobile applications development community by opening up their networks to software developers. Speaking during the launch of BetterMe in Lagos on Tuesday, Onajide, further said the campaign will expose Nigerians from all walks of life the potentials of the internet.

“With the new product, MTN will introduce to Nigerians, internet content that they may not be aware of e.g local content websites like pidgin based websites, local language news and a variety of useful information which should help people to see the positive value in the internet,” Onajide disclosed.

While shedding more light on the new product, Bayo Adekanmbi, chief marketing officer, MTN Nigeria said in the product is MTN 2015 app which is an aggregator app that brings together all the everyday websites that an average Nigeria needs for a better 2015.

He added that it curates websites on business opportunities, deals and even collage of the predictions of respected authorities on key outlook of the year. According to Adekanmbi, “The product is available in BetterMe Daily offering users 20minutes, 15MB and 35SMS at N250; BetterMe Monthly data offers users 2015MB at N2,015 and BetterMe Monthly bundle offers 100minutes, 100SMS and N2,015.”

 

Ben Uzor