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Telcos embracing once-feared OTTs

15th October 2018

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

     

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South Africa’s mobile operators are seemingly starting to embrace over-the-top (OTT) services, with offerings of OTT-related bundles with lower effective rates per megabyte of data, the Independent Communications Authority of South Africa’s (Icasa’s) latest tariff analysis report shows.

The bi-yearly report, published on Monday, is an analysis of the 134 tariff notifications submitted by operators, highlighting their different tariff plans, their prices and product offerings in the market from January 1 to June 30.

“There are positive developments regarding the initiatives by operators to embrace OTTs,” Icasa said, highlighting Cell C’s Shap bundles, Telkom’s FreeMe bundles, Vodacom’s Ticket bundles and MTN’s Social bundles, which are designed for social networks.

OTT services, which include WhatsApp, Skype and Google Hangouts, are favoured by mobile users as a cheaper, more modern alternative to sending messages, making calls and interacting online.

OTT services make use of a mobile operator’s data networks, allowing users to bypass SMSing or traditional voice calls to communicate using data tariffs, which previously left South Africa's mobile network operators concerned about the impact on their revenues and carrying the data services on their bandwidth infrastructure with limited benefit to the bottom line.

“To capitalise on the growth in uptake of OTT services, licensed operators have launched various product offerings so as to maximise their data revenues,” the authority pointed out in the report.

Cell C’s Shap bundles are available as permanent prepaid data products to all customers on Cell C prepaid tariff plans, while Vodacom’s Ticket bundles enable customers to stream or get access to services such as Video Ticket, Music Ticket, Gaming Ticket, Social Ticket, Chat Ticket, Sports Ticket and Cloud Ticket.

MTN’s Social Bundles offer daily, weekly and monthly social prepaid bundles with data bundles that enable them to share, chat, go live on Facebook, WhatsApp, YouTube and Twitter.

TARIFF INCREASES

Meanwhile, a trend analysis of five years for the standard prepaid voice and data was done, showing that most prices increased between 2017 and 2018, Icasa said.

The tariff analysis report shows that the headline standard voice prepaid tariffs for Vodacom and MTN have increased by 2.5% and 25.3%, respectively, as a result of the increase in the value-added tax rate to 15, as well as owing to commercial reasons.

Cell C has the lowest per second tariff plan at 66c per minute, followed by MTN with a tariff plan of 99c per minute.

Vodacom charges R1.23 a minute, which is the highest when compared with the other licensees’ tariff plans. Telkom Mobile does not offer a flat rate tariff plan.

Data shows, however, that customers who signed up for various promotions in the market may have benefited from lower tariffs and value-adding services.

Further, during the period under review, Rain entered the market with disruptive and innovative data offerings, enabling customers to only pay for data they have used at the end of the month.

“There are no contract lock-ins and no regular monthly fees. It offers a 1GB data bundle at a price of R50. This has a positive impact on customers who are now paying less when compared to similar bundles in the market,” the authority noted.

Edited by Creamer Media Reporter

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