Vodacom’s starter packs distribution agreement with Blue Label Telecoms under the spotlight

Blue Label Telecoms’ exclusive starter packs distribution agreement with Vodacom was set to terminate at end of January 2021, but has been temporarily extended.

This is according to Blue Label Telecoms head of investor and media relations Nicola White who was responding to questions from MyBroadband.

Blue Label Telecoms is a specialist in prepaid products and the electronic distribution of virtual merchandise.

It is South Africa’s largest supplier of prepaid airtime that is done through voucher or PIN-based airtime, and PIN-less or direct top-up airtime.

In the last financial year, Blue Label Telecoms recorded R32 billion in prepaid airtime and data transactions – its biggest revenue driver.

As South Africa’s largest mobile operator, Vodacom contributes significantly to the company’s prepaid airtime and data sales.

It was therefore big news when Vodacom gave Blue Label Telecoms notice of termination of its starter packs distribution agreement in 2016, which has a five-year notice period.

White has confirmed that Vodacom has terminated its exclusive starter packs agreement with Blue Label Telecoms’ in 2016.

However, she added that this agreement has been temporarily extended to allow both parties further time to review and negotiate a permanent contract.

No comment from Vodacom

MyBroadband asked Vodacom for comment regarding its agreement with Blue Label Telecoms, but the company would not provide any details.

“Blue Label remains an important business partner. Our distribution agreements are governed by confidentiality clauses that prevent us from disclosing the terms and conditions with third parties,” a Vodacom spokesperson said.

Now read: Cell C’s true value to Blue Label Telecoms

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Vodacom’s starter packs distribution agreement with Blue Label Telecoms under the spotlight