Posts Tagged ‘africell uganda’

Alternate Approach to Voice Price Wars in Telecom Industry in Uganda

My colleagues at Styx Technology Group are looking at alternate approaches to telecos in Uganda to increase their ARPU (Average Revenue Per Unit) a metric for revenue from each customer, instead of the current price war tagged to 3/= per second (US$ 0.1 per minute).

  1. Accept that voice is now commodity, being pushed further out by VOIP for both regular users and business, due to the improving Internet connectivity both via fixed and mobile connections. There is no longer a competitive edge to having cheaper voice, the revenues are fixed and can only go lower
  2. Bundled services: Currently there are separate plans for voice, SMS and data, which have to be purchased daily or when needed. The monthly plans have a premium attached, so without looking at the numbers I suspect that a majority of the regular users purchase daily plans as and when is needed. The telecoms can create bundled plans (already existing for voice) to include SMS and data without the hefty premium. Additional incentives can be provided for further discounts when a user pays consistently for a plan for 6 months, without any breaks.
  3. Smartphone Device and Service Contracts: While these are being gotten rid of in the US and Europe, the market in Uganda is ripe for disruption, where smartphones are paid over 12 to 24 months, with bundled services. Obviously the argument here is the risk associated with lending in Uganda, but options include partnering with financial institutions can help reduce the risk profile, work through employers to deduct the costs of the contract directly at source.
  4. Multiple Smartphone Data Plans: This is similar to the device plans above, however this allows the owner of the plan to register additional devices for monthly fee to share the data. This has been common with unlimited plans, and would provide a new revenue stream.
  5. Extending Mobile Money Services: The best service to copy is PayWay with a wide range of devices, and platforms on which to use the service based on what infrastructure the agent has. I would like to be able to swipe my VISA card and transfer money to my account without having to go through the bank interface which tends to be down more often than not.
  6. Bulk Sales of Devices to Schools: The new underlapped customer base, sell more devices to schools get parents to pay part of the costs to push e-education services, why do kids still have to fill Advanced Level and University Level choices on paper forms that can be lost? With powerful tablets in the $50 to $100 range only the telecoms have the clout, network and drive to push this through.
  7. Custom Devices and Services: These are for data collection needs, surveys etc, which can be accessed through third parties but pushing the envelope on what is possible. The key here is flexibility of service, enabling channel partners build and innovate by creating custom services and plans to meet their specific needs.
The telecoms need to think of blue ocean strategies to create new markets, provide ability for others to leverage their platform investments for new revenue channels, leveraging the example of Amazon that has created a multi-billion dollar technology infrastructure business based on solving internal problems.
What do you think?

UPDATE: This blog post follows the same thinking as The Telecom Wars in Uganda – Round 5 – 2015 and Beyond on this blog too

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