Vodacom back to winning ways

Thursday February 11 2021

A Vodacom shop in Dar es Salaam, Tanzania. FILE PHOTO | NMG


Vodacom Tanzania Plc ended 2020 on a high note after a tough year following the loss of a large number of subscribers due to SIM card registration issues.

According to the company’s second quarter of the year trading update released last week, its customer database crossed the 15 million threshold for the first time in six months in December, signalling a return to winning ways despite having to bar services to 2.9 million customers between March and June.

Customer numbers rose from 14.96 million in September to 15.17 million in December, although this was still well below the 15.5 million registered in March and the year-on-year figure of 15.6 million for December 2019.

Data penetration increased to 51.9 per cent, and data customer numbers went up from 7.74 million to 7.88 million between September and December. The company said this was due to "the continued success of our personalised bundles offering to customers.

"This resulted in a healthy increase in customers in the quarter as we continue to claw back customers barred in January 2020 by heightened regulatory requirements," it added.

It said data services remained a "key growth driver" for the company for the foreseeable future.


Losses from regulations

In February 2020, Vodacom was the first Tanzanian telcom to officially forecast a significant profit slump as a result of the regulations requiring all SIM cards to be biometrically registered using national ID cards.

Most of the logistical problems caused by the introduction of these regulations have since been resolved, but the latest Vodacom update said discussions are still in progress with the Tanzania Communications Regulatory Authority and the National Identification Authority on how to improve the SIM card approval process, including managing the high costs involved.

"During the quarter (September-December) NIDA entered into agreements with all mobile network operators to charge Tsh500 ($0.21) effective from August 1, 2020 for the use of NIDA database information for subscriber verification in line with Registration and Identification of Persons Regulations 2014,” the company said.

According to latest statistics compiled by TCRA, Vodacom remains the country's market leader in terms of telcom subscription share (31 percent of total 51.3 million subscribers nationwide), followed by Airtel (27 percent) and TiGO (25 percent). Halotel has a 13 percent market share, while government service provider TTCL has 2 percent share.

In terms of mobile money transactions, Vodacom's M-Pesa platform is also comfortably the most popular available with a 41 percent market share (just over 13.1 million users), with Tigopesa running second at 28 percent and Airtel Money third at 20 percent.

Vodacom is also the only telcom listed on the Dar stock exchange, with a current capitalisation of Tsh15,053.6 billion ($6.49 million) and an equity turnover of Tsh346.88 million ($149,517).

The company’s share price dropped from Tsh850 ($0.36) in September to Tsh770 ($0.33) in October - its lowest ever - but has held steady ever since. Vodacom shares remain a popular and regularly traded item on the DSE daily counter.