MTN subscriber base up by 3.7 percent in December quarter (Africa)
MTN Group recorded 170,573,000 subscribers at 31 March 2012. This is a 3.7 percent increase for the quarter from 164,501,000 subscribers recorded at 31 December 2011. The Group delivered a satisfactory performance notwithstanding continued high levels of competition in key markets.
Consistent with the new management structure, this commentary includes detailed analysis of each of the five larger operations (MTN South Africa, MTN Nigeria, MTN Irancell, MTN Ghana and MTN Syria) and highlights from the rest of the operations. However, a schedule of subscriber and ARPU numbers for all operations is also given.
MTN South Africa contributed 13.3 percent to Group subscribers and delivered a sound performance in a mature market. It increased its subscriber base 3.2 percent for the quarter. The postpaid segment performed well, increasing its subscriber base by 4.4 percent mainly due to attractive data propositions. The prepaid segment increased its subscriber base by 2.9 percent despite increased competition. This was attributable to competitive promotions including the continued success of MTN Zone through improved informal distribution channels. Blended ARPU declined 7.9 percent mainly due to a reduction in interconnect rates to 56 cents in March 2012 from 73 cents previously. Postpaid and prepaid ARPU decreased 6.7 percent and 8.1 percent respectively.
MTN Nigeria contributed 25.1 percent to Group subscribers and increased its subscriber base by 3.0 percent for the quarter. Net connections of 1,258,000 were negatively impacted by a nationwide strike in January and aggressive competition. Slower net connections at the beginning of the year resulted in a marginal loss of MTN’s share of the market. However, corrective measures enabled the operation to increase network capacity and improve net connections later in the quarter. No clarity has yet been provided on the deadline for SIM registration. The harmonizing of MTN Nigeria’s database of registered subscribers with the NCC database is in progress. Local currency ARPU declined by 1.1 percent for the quarter.
MTN Irancell contributed 21.6 percent to Group subscribers. On a proportional basis, reflecting MTN’s 49 percent ownership, its contribution was 11.9 percent. It continued to deliver a solid performance growing its subscriber base by 6.2 percent and increasing its share of the market for the quarter. This was mainly due to attractive value propositions including 2-in-1 SIM packs and various seasonal promotions. At the end of March, MTN Irancell recorded 213 000 WiMax customers. Local currency ARPU increased 3.7 percent due to improved network quality. The third mobile operator is expected to launch commercially in the second quarter of 2012.
MTN Ghana contributed 6.1 percent to Group subscribers, increasing its subscribers 2.3 percent for the quarter and maintaining market share in a competitive environment. This was due to attractive promotions as well as the implementation of a regional structure to better manage sales and marketing. Local currency ARPU increased by 3.4 percent mainly because of revised value propositions. The deadline for SIM registration was 1 March 2012 resulting in a disconnection of 21,237 subscribers representing 2 percent of the subscriber base. The sixth mobile operator had its commercial launch at the end of April 2012.
MTN Syria contributed 3.3 percent to Group subscribers. Its performance continued to be hampered by civil unrest in the country, which resulted in a reduction of subscriber numbers of 23,000 subscribers and a decline in local currency ARPU of 8.5 percent.
The rest of MTN’s operations contributed 30.5 percent to Group subscribers, representing an increase in users of 3.5 percent. MTN Uganda increased its subscriber base by 1.2 percent as the market slowed due to SIM registration. MTN Sudan continued to show good progress, increasing its subscriber base by 5.3 percent for the quarter attributable to attractive value propositions and improved distribution. MTN Cameroon also performed well and increased its subscriber base by 9.8 percent. This was attributable to a more aggressive informal distribution strategy and attractive value propositions. MTN Cote d’Ivoire increased its subscriber base marginally by 0.5 percent because of the removal of 200,000 non revenue generating SIM cards and lower gross connections due to SIM registration.
The Group continues to prioritise key initiatives to better manage the business as consumer trends evolve and competition intensifies. Data and related products and services continued to gain momentum. Data, including SMS, contributes 14.4 percent to revenue, driven mainly by MTN South Africa. Mobile Money has now been launched in 13 countries. At the end of March 2012, MTN had 6.2 million Mobile Money subscribers. Initiatives to optimise costs continue to be rolled out and the centralized procurement initiative is showing solid progress.
Network quality and capacity remains a key imperative for the Group. The majority of the operations continued to aggressively rollout network and achieved satisfactory progress for the quarter.
Vodafone India raises call prices for postpaid segment by 20% (India)
Telecom operator Vodafone India Ltd. has increased the call rates for its local and national calls, for its postpaid segment, by 20 percent. According to reports, the change rates are effective from May 1 and highlight the decline of price wars in the country.
According to a report by DJN, in July last year, Bharti Airtel Ltd, along with Idea Cellular Ltd. and Vodafone India hiked call rates for some of their services. In August, second-ranked Reliance Communications Ltd. said it had also raised call tariffs.
As per the report, the development is likely to add to a view chorused by the industry that high minimum prices proposed recently by India’s telecom regulator for the auction of second-generation bandwidth will lead to higher prices for customers. Stiff competition and lower entry prices have led to call rates remaining as low as less than a U.S. cent a minute.
Sprint report net loss of $863 million in Q1 2012, adds 1.1 million subscribers (USA)
Sprint Nextel Corp. announced its Q1 2012 results wherein it reported a net loss of $863 million and a diluted net loss of $.29 per share for the first quarter of 2012. The company had wireless service revenues of $7.2 billion during the quarter, an increase of more than 7 percent year-over-year, driven primarily by Sprint platform postpaid ARPU growth of $4.03 – the largest year-over-year increase on record for the U.S. wireless industry. The company reported total net subscriber additions of nearly 1.1 million during the first quarter, bringing total ending subscribers to a record 56 million.
The total number of customers on the Sprint platform grew almost 4 percent sequentially including 263,000 postpaid net subscriber additions, 870,000 prepaid net subscriber additions and 785,000 wholesale and affiliate net subscriber additions. Sprint recorded more than 1.5 million iPhone sales in the first quarter with 44 percent going to new customers. Prepaid churn on the Sprint platform improved to 2.92 percent, the tenth consecutive quarter of year-over-year improvement.
According to Dan Hesse, Sprint CEO, the continuing revenue growth on the Sprint platform, which represents the future of the company, driven by record ARPU improvement and strong net subscriber growth, contributed to the Adjusted OIBDA performance of $1.2 billion. He added that the value and simplicity of their unlimited data, talk and text plans, combined with an unsurpassed customer experience and their increasingly robust device portfolio make for a strong combination.
In terms of customer experience, during the first quarter, Sprint recorded its lowest level of calls to customer care per postpaid subscriber on record, consistent with more third-party recognition of Sprint’s customer experience.
Sprint also launched several innovative products and services in addition to its 4G LTE devices. Sprint introduced its first tablet for under $100 with a two year agreement, ZTE Optik as well as ZTE Fury, a family-friendly Android-powered device. Boost Mobile began offering LG Rumor Reflex – the fifth device from Sprint with eco-friendly attributes and the second from Boost. Additionally, the company introduced Sprint Complete Collaboration, the most comprehensive hosted and fully managed unified communications bundle available for businesses and launched additional Sprint Biz 360 solutions, phone and applications for small businesses. Sprint also created New Ventures, a new organization focused on delivering new business models that leverage open platforms to drive revenue and overall customer satisfaction for the global marketplace.
Smart observes sustained growth in postpaid segment (Philippines)
Leading wireless services provider Smart Communications Inc. expects the continued expansion of its postpaid segment this year as it gears up for the launch of exciting handset deals and voice and data plans.
Smart and Sun Cellular ended 2011 with a combined postpaid subscriber base of nearly 2 million, following the success of their best-value offerings. Smart’s parent company Philippine Long Distance Telephone Co. (PLDT) acquired a majority stake in Sun Cellular operator Digital Telecommunications Philippines, Inc. (Digitel) last year.
Guido Zaballero, Mobile Marketing Head, Smart, said that the company tripled its average daily postpaid activations largely because of the popularity of the Unli and All-In plans and smartphone-bundled plans. He added that they expect to top last year’s figures as they are set to launch exciting postpaid offerings in 2012. Consumers should watch out for the attractive handset deals and voice and data plans.
Among last year’s growth drivers were the Unli Plan 299, which allows unlimited texts to any Smart and Talk ‘N Text number, and the Unli Plan 599, which allows unlimited calls and texts to Smart and Talk ‘N Text subscribers. The iPhone Plans, Smart’s exclusive plans for the Samsung Galaxy Y Netphone edition and Netphone 701, and the Smart-Sun Text Unlimited 549 Plan also boosted postpaid figures.
The Smart-Sun Text Unlimited 549 Plan provides unlimited texts to Smart and Sun numbers, 2 hours of free Smart-to-Smart calls, and 4 hours of free Sun-to-Sun calls. It comes with a free dual-SIM phone. Smart’s All-In Plans were very popular as well, as these allow subscribers to choose Unli call and text packages, next-generation handsets, and mobile Internet plans.
Zaballero added that consumers got the best value from Smart’s Unli call and text offers as they have the biggest prepaid and postpaid subscriber base in the country, as well as the most sophisticated and reliable network.
Smart ended 2011 with a total subscriber base of 49 million.
KPN Q3 2006: mobile is key growth driver
KPN reported its Q3 2006 results this morning. Revenues increased 3.5% year-on-year to €3.028bn. EBITDA increased by 4.4% year-on-year to €1.198bn, whilst the EBITDA margin remained relatively flat at 39.5%. Free cash flow came in at €728m, a decrease of 5.9%. Mobile remains the key growth driver for the group, with revenues and other income up 16.6% year-on-year to €1.689bn. In contrast, revenues and other income from fixed operations fell by 3.8% over the period, to €1.63bn.
Comment: The company has successfully entered the VoIP segment by pushing its naked DSL and VoIP solutions. KPN’s retail share stands at around 25%, which is quite an achievement given the high level of competition it faces in the market. By the end of the Q3 2006, the company had over 270,000 VoIP subscribers, capturing 45% of gross additions in the market. The company has adopted the same multi-branding approach here as it has in other areas of its operations, enabling it to target a wider potential market.
KPN managed to slow net customer declines across its fixed operations during the period, with net line loss in Q3 2006 totalling 140,000, down from 165,000 in the previous quarter. Fixed revenues and other income fell by 3.8% year-on-year, to €1.63bn, with 2.5% due to regulatory MTA tariff reductions. The company’s plans for an all IP next-generation network (NGN) appear to be on track, having entered into an agreement with Lucent regarding network integration and project management in August 2006.
Mobile revenues and other income increased by 16.6% overall, to €1.68bn, boosted by the consolidation of the Telfort acquisition. The company delivered market leading growth of 28.8% year-on-year in its Dutch operations, providing further evidence that its multi-branding strategy is beginning to pay off. The company’s German mobile operations, E-Plus outperformed the market during the period, with service revenue growth of 11% year-on-year. Focus in the Netherlands remains on the more lucrative postpaid segment, and the company captured 50% of postpaid gross additions during the period.
Despite strong competition in the broadband market, the company increased its ADSL subscriber base by 105,000 during the quarter, bringing its total customer base to just over 2 million by the end of September 2006. Having agreed to acquire Tiscali’s Dutch operations (totalling 276,000 broadband customers), the company is set to achieve further (organic and inorganic) growth in the future.
Overall, KPN continues to deliver a sound performance, despite operating across some of the most challenging markets in Europe. Undoubtedly part of the company’s success is its willingness to meet its challenges head on. As we have commented on previous occasions, the company has earned its position as one of the most dynamic players in the industry, and its combination of forward-looking, innovative portfolios and sound financial management should stand it in good stead for the challenges it is likely to face in the future.
Source- http://www.ovum.com
