Asha Speckman
VODACOM has unveiled new pricing plans that offer customers bundled unlimited voice minutes, SMS and data for a fixed monthly fee.
The so-called smart plans, which are geared towards contract customers and are marketed under the portfolio name “Red”, are a reflection of the increasing alignment of Vodacom with UK-based parent Vodafone and consequent benefits of the partnership.
Red is the Vodafone group’s brand colour and the name for the plans, which aim at the higher end of the market.
The plans recognise the growth in smartphone penetration in the country and on the firm’s network, along with increased data usage.
According to Vodacom 70 percent of contract phones on its network are smartphones – led by BlackBerry’s 8520 model – and 30 percent are feature phones.
In addition to the new tariff structure Vodacom chief executive Shameel Joosub said the Red plans provided customers with the ability to back up data via cloud computing, access to a 24-hour, seven days a week technical support team, access to 50 percent more third generation (3G) internet and access to the company’s high performance long-term evolution, or fourth generation, network.
The new approach is aimed at providing a better customer experience and is expected to position the listed company for positive revenue growth in the longer term and loyalty at the higher end in an extremely competitive market.
In addition Vodacom intends to revamp its stores and has launched concept stores in Rooihuiskraal and Somerset West, which offer a more personalised customer experience.
The company said an extensive communication campaign would be launched and this would be the largest contract plan launch the firm had conducted in 12 years.
Arthur Goldstuck, the managing director of World Wide Worx, a technology research firm, said the new plans for the contract segment were not a game changer for the industry, instead it was a case of “Vodacom changing its own game”.
Goldstuck said Vodacom’s unlimited voice, data and SMS offering was similar to a plan offered by Telkom’s cellphone subsidiary, 8ta, but 8ta’s product did not include SMS and data.
On Thursday MTN and 8ta announced new packages, which Goldstuck said were more significant in terms of responding to new interconnection fees implemented by the industry regulator on Friday.
These fees, which operators charge to carry traffic on each others’ networks, have been dropped to 40c a minute.
Vodacom’s Joosub said the firm’s new pricing plan was not in response to the drop in interconnection fees.
The reduction of interconnection fees was a regulatory intervention introduced three years ago to lower the price of communications. Goldstuck said if one considered the average cost of a call then the rates for calls by consumers had reduced significantly since interconnection was implemented.
The Independent Communications Authority of SA said last week that it would conduct a market review to determine the effectiveness of the lower interconnection rate and it believed the rates could be dropped to 15c and eventually zero cents.