eBusiness Weekly
Subscriber numbers tumbles 50 percent to 2,63 million
Loss of benefits under OneFusion cited as main factor
Golden Sibanda
The subscriber numbers for state-owned mobile network telecommunications company NetOne, plunged nearly 50 percent in the first quarter of this year after customers deserted the network following problems encountered on its once popular “bundled” product, OneFusion.
The mobile network operator’s subscribers dropped a staggering 47 percent to close the quarter ended March 31, 2018 sitting at 2,63 million from 4,95 million at the end of 2017, according to the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ).
The sharp decline in subscribers for NetOne also negatively impacted the sector’s overall customer numbers, which fell 16,8 percent in the first three months to 11,7 million, it said.
As a consequence, POTRAZ said, the mobile penetration rate also fell 18,1 percent to 84,6 percent, after retreating from an average of 102,7 percent in the prior year comparative.
POTRAZ said the country’s smallest mobile network and another state owned network, Telecel Zimbabwe, also saw it subscribers drop 12,4 percent to 1,443 million in the first three months, partially contributing to the sharp decline in overall active subscribers in the industry.
But it was the plunge in the number of active subscribers for NetOne, Zimbabwe’s oldest but second largest mobile network operator, which caught the eye after its customers it deserted en mass.
POTRAZ director general Gift Machengete said NetOne lost subscribers partly due to the reason that the industry regulator asked all operators to clean up all inactive subscribers.
Inversely, while the two smaller networks saw customers leaving, Zimbabwe’s largest mobile telecoms network, Econet Wireless, saw numbers bulge 2,2 percent to 7,448 million.
Why subscribers deserted NetOne
“NetOne’s subscriber decline is attributed to the challenges it faced with its OneFusion product, which resulted in many subscribers abandoning their network,” Dr Machengete said. “The decline also reflects that NetOne had a lot of dormant subscribers who did not perform any revenue generating activity in the first quarter of 2018,” he added.
Dr Machengete said NetOne de-registered all subscribers who did not perform any revenue generating activity for a period of three months, as per the regulatory dictates of POTRAZ.
“As shown…NetOne and Telecel experienced a decline in mobile subscriptions whereas Econet experienced growth in the active data base.” Analysts noted Econet registered growth in subscribers given its dominance in the field of mobile money transactions, through Ecocash.
Analysts said NetOne suffered significant decline in customers after withdrawing and reducing benefits and period of validity for benefits under the OneFusion product offering.
“An active mobile subscriber is one who has used their network (simcard) for three or less months, but some bought their lines when OneFusion was hyping, but when the benefits became less in March (2017), the majority of subscribers exited,” said one analyst.
Other reports indicated that the State owned mobile operator’s customers were frustrated by the fact that their complaints about unexplained loss of data were not responded to.
“OneFusion reduced its offer and benefits and it became less attractive,” the analyst added.
In fact, POTRAZ reportedly had to intervene, ordering the network operator to compensate all customers who had reportedly lodged complaints about mysterious loss of data.
Impact on the mobile network operator
The marked decline in the number of customers for NetOne also had devastating impact on the network’s market share, which fell by 12 percent in tandem with the drop in numbers.
Telecel’s market share also declined by similar margin of 12 percent while Econet was the biggest beneficiary of the shift in the industry during the quarter, as its market share rose from 53 to 65 percent.
Further, NetOne saw its share of the revenue for mobile networks fall from 11,3 percent in the 2017 fourth quarter to 10,8 percent during the first three months of this year, as subscribers declined.
Other industry highlights
Meanwhile, in terms of other major highlights, the mobile penetration rate decreased by 18,1 percent to reach 84,6 percent in the first quarter of 2018 from 102,7 percent recorded in the last quarter of 2017 following a 16,8 percent decrease in active mobile subscriptions.
The mobile telecoms industry’s active internet penetration rate increased by 1,3 percent to reach 52,1 percent in the first quarter of this year from an average 50,8 percent recorded in the last quarter of 2017 following a 3,6 percent increase in active internet subscriptions.
POTRAZ said total mobile voice traffic decreased by 1 percent to record 1,10 billion minutes in the first quarter of 2018 from 1,12 billion minutes recorded in the last quarter of 2017.
