Vodacom has published its interim results for the six months ended 30 September 2019 which revealed a big investment in its network.
Vodacom’s capital expenditure for the six months was R4.8 billion, which, if it continues, will push its network investment to R9.6 billion for the year.
The company said the money was used to modernise its network, increase high capacity backhaul fibre and microwave, and further enhance its IT systems.
Vodacom added that this investment forms part “of our focus on becoming smarter and more agile in delivering products and services to our customers”.
Best network battle with MTN
This large network investment from Vodacom comes amidst a fierce battle with MTN to have the best network in South Africa.
MTN reigned supreme in network performance in recent years, but Vodacom is undoubtedly keen to retain the title which it held for many years in the past.
To build the best network in South Africa requires a big investment. MTN, for example, spent around R37 billion over three-and-a-half years to ensure it has the top network in SA.
Vodacom, in comparison, invested around R30 billion in its network over the same period.
The network is now upping its investment, and the results are starting to filter through to network performance.
Vodacom had a slight lead over MTN in Johannesburg in the latest network quality results – the first time this has happened since 2018.
MTN can be expected to respond to Vodacom’s network improvement drive, as it will not relinquish its “best network in SA” position without a fight.
Good news for consumers
The battle between Vodacom and MTN for network superiority is great news for South African consumers.
Vodacom and MTN’s networks are world-class. Many independent benchmarks show that these networks are on par with or better than many first-world countries.
The two mobile operators now have excellent 4G coverage and offer their subscribers access to advanced antenna technologies like 4×4 MIMO, 3CC (3 Carrier Combining), and advanced features such as 256QAM.
It is, however, not only Vodacom and MTN subscribers who benefit from this.
Cell C and Telkom subscribers roam on MTN and Vodacom’s network respectively, which means their subscribers also benefit.
One can also expect Cell C and Telkom to increasingly rely on Vodacom and MTN for their network needs, as it is simply too expensive for smaller operators to maintain a national network.
This means that Vodacom and MTN’s continued network investments are more important than ever to ensure local mobile users continue to enjoy good service levels.