MTN adds 568,000 Visafone customers to network

• Increases mobile money users by 5.0%;
• Smartphone customers now 16m

After successfully acquiring the last surviving Code Division Multiple Access (CDMA) operator in Nigeria and subsequent upgrade to the GSM platform, MTN has added about 568,000 Visafone customers to its network.

Besides, the South African telecommunications firm, which posted a $357 million loss in its condensed consolidated interim financial results for the six months ended June 30, 2016 released last week, has also increase the number of registered accounts on MTN Nigeria’s Mobile Money offering, Diamond Yellow, by 5.0 per cent to 6.5 million.

According to the half-year report, MTN Nigeria increased market share to 46.2 per cent, despite the decline in its subscriber base by 3.7 per cent to 58.9 million (including 568 000 Visafone subscribers).

MTN had last year started the process of the acquisition of Visafone, which was completed this January. The firm had hinged the acquisition on the need to improve the quality of broadband services for its subscribers.

The firm said the acquisition, which sought to leverage resources, especially the 4G spectrum for service enhancement, was also a reflective of the company’s concerted efforts to deepen the growth and roll out of broadband services across the country.

Meanwhile, the half-year report informed that the Nigerian arm’s total revenue declined by 4.8 per cent as a result of lower outgoing voice revenue and lower data revenue.

These were impacted by regulatory requirements to seek permission to charge “out-of-bundle” data rates, multi-SIMs and delays in competitive offerings. It disclosed that data revenue declined by 2.7 per cent and contributed 19.3 per cent to total revenue.

The number of smartphones on the MTN network, according to the statement increased by 11.2 per cent to 16 million, while the digital revenue continued to gain momentum and contributed 51.7 per cent to data revenue, supported by good growth in music and other lifestyle content services.

According to the report, the EBITDA margin declined by 7.5 percent to 49.8 per cent, impacted by the transfer of the second tranche of passive infrastructure into the TowerCo as well as US dollar-denominated expenses associated with the TowerCo and build-to-suit sites.

This was further impacted by a 13.8 per cent increase in marketing costs relating to the subscriber registration process as well as a range of professional services fees incurred to the settlement of the regulatory fine.

Over the six month period, the telecommunications firm informed that in Nigeria, 428 3G sites and 507 Long Term Evolution (LTE) sites were rolled out. It disclosed that the operation experienced some delays in the network re-planning as well as delays with equipment purchases as a result of foreign exchange limitations.

According to it, Capex for the period increased by 78.9 per cent to R2 534 million. Improving the quality of the 3G co-located network and the rollout of LTE remains a priority. During the period, the operation purchased additional LTE spectrum for a consideration of R1 billion.