Vodacom records 4 million new subscribers in Tanzania (Africa)

Vodacom Tanzania has claimed that it has added over 4 million customers in the past year and plans to spend about $94 million over the next one and a half years to expand network and data services, according to a report by Reuters.

Rene Meza, managing director, Vodacom Tanzania, has said the increase in users came from new customers joining its M-Pesa money transfer service, which has an 85 percent share of the total mobile commerce transactions in the country.

Meza said that they added over 4 million customers in one year, with M-Pesa acting as the biggest driver for such a growth.

Further, Meza revealed that Vodacom Tanzania had invested over US$ 627.5 million over the past decade to make it the biggest mobile operator in the country. Also, they have very ambitious plans for expansion; with the next 12 to 18 months seeing an investment of US$ 94.1 million for network coverage expansion.

The mobile internet penetration in Tanzania is no more than 3 or 4 percent as compared to the 15 percent in neighbouring country Kenya, so there is tremendous opportunity for growth. Meza said just a third of the 42 million people in east Africa’s second largest economy were connected to mobile phones.

The report reveals that communications is the fastest-growing sector in Tanzania, accounting for 20 percent of gross domestic product. Other major players in Tanzania’s mobile phone industry are Bharti Airtel, Millicom’s subsidiary Tigo Tanzania and Zantel.

Meza said inflation and exchange rate fluctuations were pushing up costs. He said the company paid its frequency fees to the mobile sector regulator in U.S. dollars while it charged users in shillings.

Meza said he does not expect further reduction of mobile phone tariffs in the country after a fierce price war in the past few years stifled new investments in the sector.