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Smaller cellphone providers struggle

Jun 09 2013 19:28

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Johannesburg - Virgin Mobile South Africa CEO Jonathan Marchbank has blamed Vodacom and MTN and their “unregulated, anticompetitive behaviour” for making it tough for smaller players to enter the market. This is according to a report on BDLive.

According to the report Virgin Mobile SA, with only 500 000 customers, is finding it challenging to enter the retail market.

Retailers, said Marchbank, are reluctant to offer Virgin Mobile products to customers because they will lose ‘trailing revenue’ from existing partnerships with Vodacom and MTN.

According to the report Marchbank said that he has given up trying to compete against Vodacom and MTN, and is rather trying to build a loyal Virgin Mobile brand following.

Marchbank was named Virgin Mobile SA CEO in August 2012.

His appointment followed a significant investment into Virgin Mobile South Africa, with Marchbank being tasked with accelerating the growth of the company.

Meanwhile Thandeka Gqubule of City Press writes that as consortiums involving the world’s largest telecoms groups compete for two new mobile licences in Myanmar this month, leading global human rights organisations have cautioned against the race to invest in the tentatively reforming east Asian country.

MTN, a member of one of the 10 consortiums still in the running, has gone large by launching a nationwide awareness campaign there.

Actions

A consortium led by Digicel Group, billionaire George Soros and Myanmar property developer YSH Finance punted its bid the last few days, promising to invest $9bn in Myanmar’s new cellphone network if it is granted a licence, according to Bloomberg.

The world’s two largest mobile operators, China Mobile and Vodafone Group, both pulled out of the process, saying the returns do not justify the investment needed in the severely under-connected country.

MTN’s experience in Iran, where it beat rival Turkcell to win a mobile licence, illustrates the intensity of the competition for national mobile licences.

Turkcell has accused MTN of a wide array of corrupt actions, but its allegations are still to be tested in court.

Three weeks ago influential international NGO Human Rights Watch published a detailed report cautioning against investments in Myanmar’s telecoms sector.

In its report, it details abusive telecoms and other legislation in Myanmar.

The Human Rights Watch report was a plea directed at the South African government and the governments of other multinational bidders.


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mtn  |  johanesburg  |  myanmar  |  telecommunications
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