On the face of it, the Covid-19 lockdown was an inadvertent blessing for South Africa’s telecom operators.
With folks caught at residence for the 5 weeks of the exhausting lockdown from March 27 to April 1, it will have been simple to suppose that the likes of MTN, Vodacom and Telkom would have gained from them posting on social media and streaming exhibits to their telephones.
In contrast to different components of the economic system, the telecoms sector had a bonus in that underneath the nationwide catastrophe laws, it might proceed to function.
Operators additionally had the benefit of the federal government giving them short-term entry to a spread of radio spectrum that might facilitate high-speed broadband providers.
The operators didn’t have to attend lengthy to see the affect of the lockdown on the demand for information.
MTN SA’s information visitors was up 77% and noticed a rise of 14.1% in lively information subscribers to 14.2 million, mentioned outgoing group CEO Rob Shuter whereas on an interim results teleconference name on August 6.
There was an identical story at rival Vodacom SA. “Knowledge visitors doubled within the quarter and utilization per good gadget grew 75% yr on yr, and 22% from the March 2020 quarter to 2.2GB per consumer,” mentioned Vodacom Group CEO Shameel Joosub throughout an investor convention name in July.
“There are actually 13.2 million 4G gadgets linked on our community, a rise of virtually 30% yr on yr,” Joosub mentioned.
Telkom additionally noticed a surge in demand. “We’ve truly been seeing a really, very big surge in visitors, each on the mounted facet of the community and likewise on the cellular facet of the community. Fortunately, our community is scalable,” mentioned Telkom Group CEO Sipho Maseko on the group’s annual results presentation.
“Knowledge consumption elevated simply within the final two weeks of March by over 35% seen in context. It’s the type of typical progress that we noticed within the 11 months between April of 2019 and about February of 2020,” Maseko added.
Common visitors consumption on Telkom’s community elevated from about 94 petabytes (one petabyte equates to about 1 000 4k motion pictures) per thirty days pre-lockdown to about 127 petabytes, which is a 33% improve thus far.
The Netflix impact
“And what have been the primary drivers of visitors that we noticed over the interval?” Maseko requested. “Largely, these have been digital providers, so streaming providers.
“You see issues like Netflix and YouTube actually, actually driving high-traffic and bandwidth consumption. DStv, the streaming element of that, working from properties or conferencing functions, whether or not it’s Zoom or Groups or every other functions that have been there.”
Operators’ information numbers for this era don’t nonetheless inform the entire story.
Although visitors over their networks was sharply up, it didn’t essentially result in huge will increase in total earnings.
MTN SA, for instance, noticed information income rise 16.7% to R7.03 billion for the half-year to finish June however it had minimize information charges 32.6% since June 2019.
The rise in information income couldn’t offset the declines in voice, digital, fintech and wholesale revenues. Total, income for MTN SA was down 2.5% to R17.6 billion for the interval.
For its half, Vodacom’s Joosub didn’t disclose information income for the primary quarter, which began on April 1. He did say that as of that date it carried out value reductions of 34% on common for its 30-day information bundles, and that “the elevated demand greater than offset these value reductions in the course of the interval”.
It needs to be famous that the declines in information charges on the a part of Vodacom and MTN observe stress from the Competitors Fee to chop costs.
Maseko additionally didn’t disclose the monetary affect of the rise in information visitors for Telkom, however did say the lockdown proved simply how adaptable the group was.
“Simply earlier than the lockdown was declared, we had about not less than 80% of our staff working from residence,” mentioned Maseko. “On the peak of the lockdown, we had as much as about 94% of our staff working from residence.”
He mentioned the lockdown inadvertently propelled SA as a complete into the digital age.
“We noticed that visitors actually start to develop in the course of the lockdown. And it stays very, very excessive. And it could be that as a rustic and as an economic system, we’ve now reached a really, very fascinating inflection level by way of the function that broadband will begin to serve in a complete lot of our every day actions.”