Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      How the Post Office plans to rise from the dead - Fathima Gany

      How the Post Office plans to rise from the dead

      17 July 2026
      iOCO snaps up ERP firm as acquisition machine cranks up - Rhys Summerton

      iOCO snaps up ERP firm as acquisition machine cranks up

      17 July 2026
      Meta AI will now tell parents if their teen is in crisis

      Meta AI will now tell parents if their teen is in crisis

      17 July 2026
      Tap to pay is finally coming to the Post Office

      Tap to pay is finally coming to the Post Office

      17 July 2026
      Xi pitches China as the world's AI liberator - Chinese President Xi Jinping waves as he arrives at the opening ceremony of the World AI Conference in Shanghai. Ng Han Guan/Reuters

      Xi pitches China as the world’s AI liberator

      17 July 2026
    • World
      Swingeing jobs cuts at Microsoft's Xbox unit

      Swingeing jobs cuts at Microsoft’s Xbox unit

      6 July 2026

      SK Hynix ends Samsung’s 26-year reign at the top

      22 June 2026
      Google on the hook for what its AI tells users, court rules

      Google on the hook for what its AI tells users, court rules

      15 June 2026
      How Russians juggle VPNs to outwit the Kremlin

      How Russians juggle VPNs to outwit the Kremlin

      15 June 2026
      Amazon CEO flagged Anthropic AI risks to Washington - Andy Jassy

      Amazon CEO flagged Anthropic AI risks to Washington

      14 June 2026
    • In-depth
      AI boom sparks rally, frenzy and fear

      AI boom sparks rally, frenzy and fear

      11 June 2026
      Every plug-in hybrid on sale in South Africa, ranked by price - Lamborghini Temerario

      Every plug-in hybrid on sale in South Africa, ranked by price

      7 June 2026
      What Wi-Fi 8 will mean for wireless networks

      What Wi-Fi 8 will mean for wireless networks

      1 June 2026
      Alfa's electric rebel - Alfa Romeo Junior Elettrica Veloce

      Alfa’s electric rebel

      29 April 2026
      Africa switches on as Europe dims the lights

      Africa switches on as Europe dims the lights

      9 April 2026
    • TCS
      Watts & Wheels S1E7: 'Ferrari's EV breaks the internet'

      Watts & Wheels S1E7: ‘Ferrari’s EV breaks the internet’

      8 July 2026
      TCS+ | How Tracker is turning vehicle data into business strategy - Silvia Schollenberger

      TCS+ | How Tracker is turning vehicle data into business strategy

      1 July 2026
      TCS+ | IBM Bob: an AI-powered 'development partner' for the enterprise - David Spurway

      TCS+ | IBM Bob: an AI-powered development partner for the enterprise

      30 June 2026
      Watts & Wheels S1E6: 'A flawless Alfa and a bakkie that divides'

      Watts & Wheels S1E6: ‘A flawless Alfa and a bakkie that divides’

      17 June 2026
      Watts & Wheels S1E6: 'A flawless Alfa and a bakkie that divides'

      Watts & Wheels S1E5: ‘A Bentley of the bush and a car that swims’

      8 June 2026
    • Opinion
      The author, Fanie van Rooyen

      South Africa can still catch the AI wave – here’s how

      7 July 2026
      The author, Fanie van Rooyen

      The AI utopia South Africa can’t afford

      1 July 2026
      Selling vapour is corporate suicide in slow motion - Jannie van Zyl

      South Africa’s broadband future is being decided in orbit, not in Pretoria

      30 June 2026
      The author, Pambos Soteriades

      The pivot South Africa’s MVNOs cannot afford to miss

      23 June 2026
      Brazil's online gambling crackdown is a lesson for South Africa

      Brazil’s online gambling crackdown is a lesson for South Africa

      22 June 2026
    • Company Hubs
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CM Telecom
      • Contactable
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
      • Watts & Wheels
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Opinion » Craig Wilson » Gloves off in mobile price war

    Gloves off in mobile price war

    By Craig Wilson17 May 2012
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    It’s no secret that despite having the longest-standing mobile networks on the continent, SA still has some of the highest mobile call rates in Africa. This week, Cell C went some way to correcting that when it announced it was cutting prepaid rates, and hinted that new post-paid pricing will follow soon, but there’s arguably still a long way to go.

    On Wednesday, Cell C announced it was dropping prepaid call rates to 99c/minute regardless of the time of day or destination network. Within minutes, Vodacom responded with its own price cut, that appeared, at first glance, to match Cell C’s rate.

    Vodacom’s offering, however, sees customers billed 99c for the first minute, and then in 30-second increments thereafter. Cell C’s new prepaid plan, on the other hand, is billed per second from the first second, making it much better priced and, more importantly, the more transparent of the two offerings.

    Some of the reason Cell C was able to make the price cut is that it enjoys preferential mobile termination rates — the fees networks charge one another to field calls on their networks. Because Cell C has less than 20% market share, it pays a lower fee to Vodacom when receiving a call from a user on the latter’s network than the fee it has to pay when the reverse takes place.

    Vodacom argues it’s sweetened the deal by offering customers who recharge with R12 or more an additional 60 minutes of talk-time between midnight and 5am. The problem is, these bonus minutes are only applicable to on-net calls — that is, calls to other Vodacom users.

    While this may be of value to Vodacom users that have a long commute that requires them to rise before 5am, they still need to ensure that the person they’re calling is on the same network — and that they’re awake. With consumers having the ability to change networks and keep their number, it’s quite difficult to check if a call is, in fact, to a user on the same network — a number with a Vodacom prefix like 082 need not mean a Vodacom customer.

    Compared to Cell C’s straightforward offering, Vodacom’s is still rather opaque. And the value-add of free minutes is of limited use to most customers. Moreover, on a per-second basis, it’s simply more expensive.

    Cell C must be lauded for the simplicity of its new offering, preferential termination rates or not. Aside from the cheaper rates, it’s the lack of obfuscation that really sets the bar other operators should be aiming to match.

    MTN, meanwhile, has said it won’t be drawn into the price war, claiming that its “MTN Zone” plans mean its rates are already the most affordable in the market because it offers customers “free calls” through its “Mahala Thursday, Mahala Nights, Mahala Weekends and Mahala Day” time-based rates.

    That’s four separate pricing schemes with which consumers need to familiarise themselves if they’re to take advantage and save money. MTN’s pricing is arguably the most impenetrable of all the major players.

    It’s precisely these convoluted pricing plans that confuse consumers and allow operators to capitalise on consumers’ inability, or lack of desire, to attempt to decode the jargon and minutiae that has long pervaded SA mobile services.

    Consumers want simplicity and, in a market where disposable income and education levels span a gamut far broader than those of developed countries, the operator that can offer the most transparent and cheapest packages deserves the biggest market share.

    Cell C’s CEO Alan Knott-Craig has hinted that contract subscribers can expect price cuts soon and hopefully these will be similarly simple to understand and force both Vodacom and MTN to react. If they start seeing customers churning over to Cell C, you can bet they’ll respond in kind.

    Pricing of both voice and data needs to get to the level where operators are forced to compete on quality of service and unambiguous value-added services. With mobile termination rates set to fall again, and the Independent Communications Authority of SA having said it will continue to assess the rate beyond next year, retail price competition is going to intensify.

    At the end of the day, price cuts are good for operators and consumers alike. Consumers save money and operators are forced to innovate. In a mobile landscape like SA’s, where the incumbents have been able to make huge profit margins on voice and data for a decade and a half, this price war hasn’t come a moment too soon.

    Prices have a long way to fall, but at least someone’s made the first, crucial push to lower them.  — (c) 2012 NewsCentral Media

    • Craig Wilson is senior journalist at TechCentral
    Follow TechCentral on Google News Add TechCentral as your preferred source on Google


    Alan Knott-Craig Cell C Craig Wilson MTN Vodacom
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleEkurhuleni lifts fibre moratorium
    Next Article Smaller players back call for MTR cut

    Related Posts

    Amazon Leo all set for South African launch - From left, Maziv CEO Dietlof Mare, communications minister Solly Malatsi, Herotel CEO Van Zyl Botha and Amazon's David Zapolsky

    Amazon Leo all set for South African launch

    15 July 2026
    Industry to Icasa: punish municipalities that stall network roll-out

    Industry to Icasa: punish municipalities that stall network roll-out

    13 July 2026
    The fragile joint in the Capitec machine

    The fragile joint in the Capitec machine

    9 July 2026
    Company News
    Paratus again voted Namibia's most reliable internet provider

    Paratus again voted Namibia’s most reliable internet provider

    17 July 2026
    Core opens Microsoft Surface reseller programme to South African SMEs - John Press

    Core opens Microsoft Surface reseller programme to South African SMEs

    17 July 2026
    The economy the statistics miss is thriving on Spondo Street - Lesaka Technologies Lincoln Mali

    The economy the statistics miss is thriving on Spondo Street

    16 July 2026
    Opinion
    The author, Fanie van Rooyen

    South Africa can still catch the AI wave – here’s how

    7 July 2026
    The author, Fanie van Rooyen

    The AI utopia South Africa can’t afford

    1 July 2026
    Selling vapour is corporate suicide in slow motion - Jannie van Zyl

    South Africa’s broadband future is being decided in orbit, not in Pretoria

    30 June 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    How the Post Office plans to rise from the dead - Fathima Gany

    How the Post Office plans to rise from the dead

    17 July 2026
    iOCO snaps up ERP firm as acquisition machine cranks up - Rhys Summerton

    iOCO snaps up ERP firm as acquisition machine cranks up

    17 July 2026
    Meta AI will now tell parents if their teen is in crisis

    Meta AI will now tell parents if their teen is in crisis

    17 July 2026
    Tap to pay is finally coming to the Post Office

    Tap to pay is finally coming to the Post Office

    17 July 2026
    © 2009 - 2026 NewsCentral Media
    Built and maintained by Chronon
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}