Vodacom grows customer base
In South Africa the total number of customers increased by 15.3% to 23.3 million (September 30, 2006: 20.2 million) for the six months ended September 30, 2007.
The number of prepaid customers increased by 13.5% to 19.8 million, while the number of contract customers increased by 27.4% to 3.4 million.
Disconnect rule
It is Vodacom’s policy to disconnect inactive prepaid SIM cards after seven months without a revenue generating activity on the Vodacom network, e.g. making or receiving a call, sending or receiving an SMS or transmitting data. Network activities relating to call forwarding to voicemail are classified as revenue generating activities.
Since implementing this rule, prepaid SIM cards remaining in an active state on the network, with only call forwarding to voicemail and no other revenue generating activities, increased significantly.
It has therefore been decided to implement a supplementary disconnection rule that will disconnect inactive prepaid SIM cards after 13 months of being kept in an active state by call forwarding to voicemail only and not having had any other revenue generating activity on Vodacom’s network.
The implementation of the supplementary disconnection rule has led to the disconnection of an additional 2.9 million prepaid SIM cards in September 2007, increasing churn on the prepaid customer base to 51.9% for the period under review.
This rule change is expected to increase prepaid churn, but provides a better reflection of active prepaid SIM cards on the network and hence results in a higher average revenue per user (ARPU).
The implementation of this supplementary rule has no impact on the financial performance of Vodacom South Africa.
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