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Cape Town - Africa’s biggest mobile network MTN plans growing its enterprise unit faster than any potential decline in its consumer business.
This is according to the company’s group chief enterprise officer, Mteto Nyati, who joined MTN in October after taking up managing director roles for software giant Microsoft in South Africa, Africa and the Middle East.
MTN experienced subscriber growth of 2% quarter-on-quarter to reach 219mn mobile phone subscribers across its African and the Middle East operations for the period ending September 2014.
But MTN’s biggest market, Nigeria, came under pressure in the quarter where it dropped from 58.446mn subscribers in the previous period to 58.363mn. MTN in its quarterly report blamed regulatory pressures in Nigeria for the fall in subscribers.
Meanwhile, MTN South Africa’s mobile phone subscriber market in South Africa grew by 1.4mn subscribers from the previous quarter to 26.7mn. But MTN says its average revenue per user (ARPU) decreased by 4.6% to R89.26 .
MTN South Africa earlier this year also announced a job-cutting process at the company.
However, Nyati says MTN’s plans targeting enterprise clients and growing this segment to 20% of the telecom firm’s revenues in three to four years time.
Nyati told Fin24 that MTN intends rolling out cloud services to the enterprise. He also added that the company plans targeting Africa’s healthcare and education sector by helping to connect schools and hospitals across the continent.
"We have set ourselves a target," Nyati told Fin24.
"We have a company that is growing, and you have to continue to be 20% of a growing company," he said.
MTN’s move to broaden its revenue base is in line with other telecom firms in South Africa.
Converged telecommunications player, Telkom, is in a bid to buy South African cloud based service provider Business Connexion (BCX) to extend its enterprise footprint and reach into Africa.
Telecoms analyst, Thecla Mbongue of Ovum, agrees that local telecom players are actively expanding their business base.
“We forecast non-voice revenues to generate 31% of South Africa mobile service revenues (excluding equipment sales) over 2014,” Mbongue told Fin24.
“We’ll near a 50/50 contribution towards end-2017. From 2018 non-voice is expected to be the largest mobile revenue contributor,” she added.
Lehlohonolo Mokenela, ICT research analyst at Frost & Sullivan Africa, told Fin24 that South Africa’s telecom space is reaching saturation point with its declining voice revenues. And the result is that operators are focusing more of their efforts on 3G and 4G data offerings, and even fibre and Wi-Fi.
“However, they will need to move beyond just offering the pipe, and focus more on what customers can do with the data, and that is what will drive their growth, said Mokenela.
“Their fibre-to-the-home (FTTH) deployments are one step towards owning more of the customer experience, especially in the home, which will allow them to offer triple-play services, bundling voice, video and data. Machine-to-machine is another segment they have been looking to use to boost their revenues,” Mokenela added.
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