Vodacom is pulling in 67,000 customers a day in South Africa as its prices fall – and it says data will keep getting cheaper

Business Insider SA
Vodacom data
  • Vodacom says it added 608,000 customers to its South African network in the last quarter – which is an average of enough people to more than fill Ellis Park Stadium every day.
  • At the same time it actually made less money from selling those customers services, in part thanks to regulations forcing down data prices.
  • But if you like cheaper data, just wait until it gets new radio frequency spectrum.
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In the three months to the end of June it added 608,000 customers to its network in South Africa, Vodacom told shareholders in a trading update on Thursday – making for an average of just under 67,000 people signing up per day.

That's the equivalent of enough people to fill up Ellis Park Stadium in Johannesburg, with many spilling out into the parking lot, activating Vodacom SIM cards every day.

Yet the company also said the amount of money it made from its customers in South Africa declined slightly. At R12.6 billion its SA service revenues were down 1.2% compared to the same 91 days in 2018, it said.

The rise in customers and fall in revenue does not seem to be unrelated. A "tough operating environment" in SA and a change in roaming partners contributed to the fall in revenue, the company said. But the just-ended quarter was also the first full three-month period in which strict new regulations intended to force down data prices were in force.

See also: Vodacom is spending billions on 'SA’s cheapest data network' Rain, while its own data prices continue to plummet

The limited numbers Vodacom released in the trading update do not show by just how much its data prices declined, but the company reported a 52% increase in data traffic in South Africa compared to the previous year – despite those tough economic conditions weighing down on consumers.

A further, and possibly steep, drop in data prices should also be coming up soon, as long as the government keeps its promises.

Vodacom is "encouraged" by the promise President Cyril Ramaphosa made to finally award new radio frequency spectrum that cellphone companies desperately need, said CEO Shameel Joosub.

This is a vital part of reducing input costs and further bringing down data prices in South Africa, where lengthy delays in completing the digital migration and allocating 4G spectrum has curbed the pace at which data prices could have fallen."

A lack of adequate spectrum in the right bands means cellphone companies have to build more towers than they would otherwise need.

See also: Yes, SA data is more expensive than it needs to be, Vodacom says – and it is all government’s fault

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