Mobile services firms feel the pinch as social media eats into voice revenue

A smartphone user. Social media platforms are eating telecom companies’ revenue collections from voice services. FILE PHOTO | NMG 

In Summary

• Mobile services subscribers say WhatsApp calls and Facebook Messenger are cheaper than normal voice calls and text messages.
• Nearly all smartphones have OTTs, specifically WhatsApp and Facebook pre-installed.
• Statistics show that Facebook Messenger has a higher membership rate but a lower user percentage than WhatsApp.

Calls between Vodacom numbers outside the bundle are charged at Tsh4.5 (0.195 US cents) per second all day, while those to other networks cost around Tsh5.5 (0.238) US cents per second. Local text messages outside the bundle to any network in the country are charged atTsh50 (2.1 US cents) each.

Internet access providers

Telecom industry watchers say if this trend continues across Tanzania, it will ultimately see mobile service operators turn into Internet service providers and charge flat fees for connectivity, while leaving communications services to OTTs.

Nearly all smartphones have OTTs, specifically WhatsApp and Facebook pre-installed.

Statistics show that Facebook Messenger has a higher membership rate but a lower user percentage than WhatsApp.

Data from the GSM Association shows that there are around 4.9 million active social media users in Tanzania, 4.4 million of whom have access to it through mobile phones.

Meanwhile, overall Vodacom Tanzania service revenue rose by 5.4 per cent on a year-on-year basis, to $441.551 billion (Tsh1.019 trillion) driven by strong growth in M-Pesa, mobile data and messaging revenue.

M-Pesa revenue grew by 14.5 per cent to $144.512 million (Tsh333.5 billion), largely attributed to significant growth in its customer base and an increasing uptake of mobile money products as the ecosystem continues to expand, the telco said.

The Tanzania Communications Regulation Authority says that although Vodacom remains the number one mobile services provider in the country with 14.1 million subscribers — 32 percent of the overall market share — it lost some 15,535 voice subscribers between November and December 2018.

Tigo Tanzania comes in second with 12.6 million subscribers (29 per cent market share) after adding 29,703 new voice subscribers in December.

Airtel Tanzania holds a 25 per cent stake with just under 11 million voice customers as of December 2018.

In mobile money accounts, Vodacom M-Pesa leads with a 39 per cent market share (around 9,014,088 subscribers), Tigopesa comes in second with a 32 per cent stake (7,586,240 subscribers), while Airtel Money is third with 21 per cent stake (around 4,848,545 users)