falcon786
Honorary Master
Exactly,same here.Plus I'm on contract for the convenience and MTN contract rates are still terrible.
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MTN hits Cell C where it hurts
- Thread starter QuintonB
- Start date
Exactly,same here.Plus I'm on contract for the convenience and MTN contract rates are still terrible.
Nephew_
Senior Member
It looks like someone made a nice picture (Cell C stabbed by MTN), then realised they could write an article to go with it.
How many hoops do you need to clear to get that 79c/m?
How many hoops do you need to clear to get that 79c/m?
When MTN started the court case against ICASA Cell C said that if the new MTR rates come into operation they will be able to cut the call rates to 79c a minute. If they do that we'll have two cell providers with the same price but the one price is promotional only and the supply is full of T&Cs.
I am with you there, esteemed sir.
jannievanzyl
Telecoms expert
I'm surprised Cell C did not use the opportunity to drop first. They said, if they get the new MTRs, they'll drop to 79c. They got it and now it seems the big players are going to beat them to it.
Think it's a really big lost opportunity for them.
That is not exactly what they said
They suggested that the full 3 year CTR schedule - with growing asymmetry - would allow them to drop to 79c and that they would be able to have introduced a shake up Infinity product. They don't have growing asymmetry but rather a mere 100% asymmetry over large mobile operators and 400% on fixed line. Therefore they can't finance dropping call prices to 79c and it wouldn't make sense to go into a market share war for CellC (growing asymmetry would justify a strategy of burning cash to poach volume)
Asymmetry is here to help cellc, they simply need to capitalise on that! no reason they end up loosing more money with the new termination rates, if the likes of VOX can offer people a credit on receiving calls, why can't cellc do the same? With it they will be able to get more people to their network, the more calls they receive from outside of Cellc the better it is for them.
Wake up!! MTN / VC manipulated the playing field for long enough, right now the referee is on your side, take the game, control it and nail them with it.
Wake up!! MTN / VC manipulated the playing field for long enough, right now the referee is on your side, take the game, control it and nail them with it.
Rather end a promotion than have a blanket price increase on standard pricing.
Cell C has one foot on the grave now.
Polymathic
Honorary Master
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well I hardly ever make phone calls .
10i
Expert Member
MTN is 79c on promotion, Telkom Mobile Simsonke is 79c per minute with loads of extras like free SMS and free WiFi and free calls to Telkom numbers when you recharge. All for 79c and you don't have to jump through hoops. And if you are lucky enough to phone a fellow Simsonke member, the cost is 29c.
So, with no free airtime, SMS, WiFi, etc. Only the airtime you load - is MTN really cheaper than Telkom?
So, with no free airtime, SMS, WiFi, etc. Only the airtime you load - is MTN really cheaper than Telkom?
Captain Beer
Executive Member
IIRC, calling it a promotion is just a way of avoiding having to get the new rates approved by ICASA. I'm pretty sure we'll see this promotion continue indefinitely.
Colin62
Executive Member
Just what I was thinking. I wonder how many people spend more money on mobile data than they do on voice calls? I reckon quite a few, although I suspect that doing a quick survey of MyBB members will be skewed.
plugger123
Senior Member
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MTN & Vodacom kills Cell C.
Cell C is dead.
MTN & Vodacom back to their old tricks.
Cell C is dead.
MTN & Vodacom back to their old tricks.
It will be a tragic if we repeat the airline story, where premature talk of bankruptcy ends up becoming a self-fulfilling prophecy.
Voice calls are highly elastic (in economics speak: elasticity much greater than one) so if MTN drops rates by 20% they get far more than 20% incremental minutes to compensate and Cell C actually increases revenue significantly. More relevant is whether or not Cell C's network can handle the extra traffic.
MTN and Vodacom will squeeze distribution channels and Cell C will therefore also be able to reduce distribution costs.
We've been saying for years that these costs are way too high and needed to come down and the market should be able to support 4 players as well as competitive pricing.
Data is going up exponentially and still way over priced so Cell C should be able to survive and thrive
Voice calls are highly elastic (in economics speak: elasticity much greater than one) so if MTN drops rates by 20% they get far more than 20% incremental minutes to compensate and Cell C actually increases revenue significantly. More relevant is whether or not Cell C's network can handle the extra traffic.
MTN and Vodacom will squeeze distribution channels and Cell C will therefore also be able to reduce distribution costs.
We've been saying for years that these costs are way too high and needed to come down and the market should be able to support 4 players as well as competitive pricing.
Data is going up exponentially and still way over priced so Cell C should be able to survive and thrive
The_Unbeliever
Honorary Master
Another scenario is that one of the overseas operators buy CellC over, and start going at the SA market hammer and tongs...
...which will disadvantage Voda & MTN...
...which will disadvantage Voda & MTN...
medicnick83
Paramedic
The more they fight, the more they drop their prices, the better for us at the end of the day.
If Cell C was to fail, don't fear, there will always be another to replace it.
If Cell C was to fail, don't fear, there will always be another to replace it.
I think you need to exclude consideration for the ability of CellC's network to handle the extra traffic because the article works on an assumed constant on that front - the real issue being the cutting of 18.9c of gravy money which CellC would use to avoid "burning the furniture"
I am not sure that it should be assumed that voice traffic is always highly elastic and there is a factor by which the elasticity of voice traffic changes its elasticity - and the extent to which there are substitutes and social pressure needs to be borne in mind. However the point is that if MTN drops off their rates by 20% and thereby increases minutes sold by 30% then CellC gets a portion proportionate to their market share and the benefit of asymmetry so they are winning all they way around. Dropping prices to a point at which the total social demand for call volumes is saturated will lead to a very inelastic situation.
The real problem is that CellC has successively (and no particularly successfully) embarked on low price orientated competition which attracts it lower ARPU sectors and their financial muscle simply isn't there. They are essentially requiring a situation where competition is imposed onto their competitors in order to use their nimble edge. CellC is in trouble - and they have been for a while - but it is misguided to hold them as dead in the water or in a perilous position if CTRs are determined in a rational fashion. Even without asymmetry the reduction would probably benefit CellC's strategy because of the elasticity.
MTN & Vodacom kills Cell C.
Cell C is dead.
MTN & Vodacom back to their old tricks.
Cell c was stupid to bully MTN & lie to the public the way they did.
MTN replied.
Jose was stupid to say they "would" reduce their prices to 79c when he knew full well it would be financial suicide to do.