Presentation to PPC Cost to communicate (2) 7 November 2014

Transcription

1 Presentation to PPC Cost to communicate (2) 7 November 2014

2 Contents 1. Reflection: Cost to communicate (Cape Town 30 November 2012) 2. Cost to communicate 2012 onwards 3. South Africa achievements 4. International ranking and challenges towards available, accessible and affordable services 5. Comparison 6. Concluding thoughts

3 Reflection: Cost to Communicate Cape Town 30 November 2012

4 Reducing the cost to communicate Prices are declining and will continue to go down due to Pricing: Blended and prepaid R Pricing: Data R R R 800 R MB Price 1GB Price 2GB Price June'08 Blended ppm June 12 Prepaid ppm R 400 R 200 R 0 44% decrease in effective prepaid PPM to 79c 30% decrease in effective total PPM to 1.07c 88.5% decrease in 1GB data package from R599 to R69 (24 Month Mobile Broadband) Out of bundle rate decreased by 90% from R10 to R1 per MB. effective competition in the telecommunications market.

5 Data growth Broadband demand is Data revenue contribution Active data customers Active data devices % of service revenue Internet Users Smartphones PC Connectivity Tablets FY2009 FY2010 FY2011 FY2012 FY2010 FY2011 FY2012 FY2010 FY2011 FY % increase in data revenue service contribution for period 82% increase in active data customers 117% increase in active data devices 5. fuelled by smartphones and tablets.

6 Cost to communicate 2012 onwards Cape Town 7 November 2014

7 The journey: Significant progress in transforming pricing Investment Pricing Transformation Simplification Bundles Invested heavily in network to carry more traffic as prices are reduced. Invested in increased coverage especially 3G/4G. Substantially reduced pricing for voice and data. Much more value offered. Launched worry free innovations RED, PowerHour, My5, Everyday Extra, SMS All tariffs are simple & transparent On net, All net, Anytime offers. Old tariffs shifted to legacy. Proactive migration in place for both voice and data legacy plans. On net bundles and all net bundles to drive down cost to communicate and target low end users. Data growth Significant data growth to supplement declining voice revenues. Where to next Work proactively to build network capacity to maintain best network experience. Embed and activate new pricing through education campaigning.. delivering value to customers.

8 The journey: Prepaid pricing catering for. access and affordability.

9 The journey: Simplified and much more value Vodacom Smart/Red Subscription (no device) Subscription (with device) Voice Data SMS Smart S R149 R Smart M R229 R Smart L R379 R Smart XL R529 R Red Advantage R749 R GB Limitless Red Premium R1199 R GB Limitless Red VIP R1499 R Limitless 5 GB Limitless Simplified price plans with any network anytime pricing. Substantial value added. Integrated price plans with smartphones included driving data adoption.. to Contract customers.

10 The journey: Further price reductions and more choice Prices continued to decline Pricing: Blended and prepaid Contract: Integrated plans Hybrid: Smart and flexi plans R % Jun 13 Blended ppm 0.46 Jun 14 Prepaid ppm Voice plans Integrated plans 28% decrease in effective prepaid PPM to 46c 25% decrease in effective blended PPM to 68c 26% increase in total outgoing voice traffic Converted 63% of voice only contracts to Smart and Red plans 83% of monthly gross connections in Top Up are on uchoose plans

11 The journey: Accelerating take-up of mobile data Broadband demand is Data contribution Active data customers Active data devices 25.8% of service revenue % 48.1% 52.3% FY2012 FY2013 Q FY2012 FY2013 Q Active data customers Penetration Smartphones PC connectivity Tablets 18.4% increase in data revenue 25.0% growth in active data customers Smartphone average usage up 44.5% to 312MB. fuelled by smartphones and tablets. 12

12 The journey: Simple and transparent engagement Retail Call Centre Online Self Service Direct. towards informed decisions on service provider, service and tariff.

13 The journey: Customer satisfaction We track our net promoter score ( NPS ) on a monthly basis. our key measure of customer satisfaction.

14 South Africa achievements

15 Mobile penetration and coverage SA has a vibrant mobile market 96% 89% 79% 42% 44% 51% 55% 64% 67% 71% 25% 145% 148% 134% 126% Population Coverage 3G 94.1% Madagascar Malawi DRC (ex-zaire) Mozambique Tanzania Swaziland Angola ave Zambia Lesotho Zimbabwe Namibia Mauritius South Africa Botswana Source: GSMA, Intelligence ( estimates) Vodacom s accelerated capital investment programme Completed network RAN renewal 4G ready 2000 LTE sites 76% of sites connected to own high capacity transmission network. 3G where we have 2G. 2G 99.9%

16 International ranking and challenges towards available, accessible and affordable services

17 South Africa s ranking improved Network Readiness Index Brazil Russia India China South Africa Ranking for period Network Readiness Index SA continued to show robust growth. SA s global ranking improved based on certain important improvements in the penetration of ICTs among individuals. SA has overtaken India and ranks favourable with Brazil and China. Source: compared with Brazil and China

18 Spectrum challenge: Timely assignment is vital for growth The amount of assigned spectrum Operators & IDI Rankings (ITU) Amount of Spectrum Allocated (MHz) IDI ranking Source Vodafone and ITU IDI*: Global ICT Development Index 2012 Amount of Spectrum (MHz) IDI Ranking European Regulators assigned 800MHz spectrum between 2010 and 2013 When will Regulators in Africa follow suite? correlates with ITU ICT Development Ranking

19 Other challenges Site acquisition High rentals Cumbersome approval process Objections from public Lack of policy or alignment of policy in municipalities Long lead times to obtain AC power Fibre and microwave deployment Way leaves Cumbersome approval process One-trench policy Mast space and strength on existing infrastructure

20 Comparison

21 Comparison against peer countries Performance indicators should amongst other consider Coverage Pricing Technology e.g. LTE Investment 8.4 Speed Internet users Penetration Devices in assessing SA s global ranking.

22 Concluding thoughts

23 Concluding thoughts Prices continue to decline Increased customer centricity Increased investment in coverage and capacity Spectrum required towards further improvement Be assured of Vodacom s commitment

24 Thank you 29