MTN 79c per minute call rate paradox

Cull may be technically correct, but the article is approaching this from the wrong angle (regulatory). It's a marketing issue. It is related though :

Brand strength is what enables operators to charge a premium. MTN lost brand equity from being seen as overpriced and then from mis-handling the PR around the termination rates debacle. When brand slips, prices must drop too.

Unfortunately, having too many terms and conditions hurts the brand. Simple, transparent and broad-based pricing would have been the preferred route
 
“Throughout its 20 year history, MTN has been at the forefront of driving down the costs of telecommunications through innovation and smart solutions, we have introduced this flat rate because we understand the needs of our customers,” Gouldie said. “This exciting promotion is a response to the voices of our customers who have been clamouring for a simple, no-frills and fixed rate.”
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The marketing speak just made me :sick: in my mouth a bit. I am surprised that he didn't include references to painting creches and hugging trees before pretending to get to the facts.
 
“Throughout its 20 year history, MTN has been at the forefront of driving down the costs of telecommunications through innovation and smart solutions, we have introduced this flat rate because we understand the needs of our customers,” Gouldie said. “This exciting promotion is a response to the voices of our customers who have been clamouring for a simple, no-frills and fixed rate.”
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:confused: HUH?
 
I love dominic's parting shot :

He added that it is possible to see from MTN’s retail rate cuts who the real winners were.

“For the next six months at least,” Cull said.
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:D:D:D:D
 
entrepr said:
Cull may be technically correct, but the article is approaching this from the wrong angle (regulatory). It's a marketing issue. It is related though :

Brand strength is what enables operators to charge a premium. MTN lost brand equity from being seen as overpriced and then from mis-handling the PR around the termination rates debacle. When brand slips, prices must drop too.

Unfortunately, having too many terms and conditions hurts the brand. Simple, transparent and broad-based pricing would have been the preferred route
Click to expand...
Do I understand this right, a month or so ago MTN and VC complained about loss in revenue due to CTR cuts. Now after the cut they drop the prepaid call rates with 20c/min resulting in an even bigger loss of revenue :wtf:

This was done from a marketing perspective hoping to draw in volume clients and stabilizing or upping their income?
 
Falco said:
This was done from a marketing perspective hoping to draw in volume clients and stabilizing or upping their income?
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And they probably still make a profit even if MTN clients call Cell C or TM numbers.
 
Falco said:
Do I understand this right, a month or so ago MTN and VC complained about loss in revenue due to CTR cuts. Now after the cut they drop the prepaid call rates with 20c/min resulting in an even bigger loss of revenue :wtf:

This was done from a marketing perspective hoping to draw in volume clients and stabilizing or upping their income?
Click to expand...

Im feeling :sick: because as a contract person I pay more than double their promotional rate, so I am definitely going to change to pay as you go or which ever package gives me the best rate. Wouldn't it be the day that ICASA says that their 75c should be standard across all their packages. But I guess I can only dream.
 
Nefertiti said:
Im feeling :sick: because as a contract person I pay more than double their promotional rate, so I am definitely going to change to pay as you go or which ever package gives me the best rate. Wouldn't it be the day that ICASA says that their 75c should be standard across all their packages. But I guess I can only dream.
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Well I moved to Cell C a while ago, not regretting it for one day.
 
... Brian Gouldie, said that market demand drove the change.

“Throughout its 20 year history, MTN has been at the forefront of driving down the costs of telecommunications through innovation and smart solutions, we have introduced this flat rate because we Brian Gouldie, said that market demand drove the change.

“Throughout its 20 year history, MTN has been at the forefront of driving down the costs of telecommunications through innovation and smart solutions, we have introduced this flat rate because we understand the needs of our customers,” Gouldie said. “This exciting promotion is a response to the voices of our customers who have been clamouring for a simple, no-frills and fixed rate.”,” Gouldie said.
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Please explain why there was no "market demand" previously?
When did MTN get to "understand the needs of our customers"?
So your client were not previously "clamouring for a simple, no-frills and fixed rate."

Only a chief marketing officer or the King of Nkandla can spew such drivel and believe it...:sick:
 
entrepr said:
Cull may be technically correct, but the article is approaching this from the wrong angle (regulatory). It's a marketing issue. It is related though :

Brand strength is what enables operators to charge a premium. MTN lost brand equity from being seen as overpriced and then from mis-handling the PR around the termination rates debacle. When brand slips, prices must drop too.

Unfortunately, having too many terms and conditions hurts the brand. Simple, transparent and broad-based pricing would have been the preferred route
Click to expand...

agree that regulatory is not the best angle to view things from but when you say "MTN lost brand equity from being seen as overpriced" what was it that caused them to be seen as overpriced? i would argue the Cell C 99c which was offered as a direct result of the previous termination rate cuts. so while they have made errors (and continue to with their overly-complicated terms and conditions) and appear increasingly out of touch with the changing consumer reality, regulatory action is at heart of it.

note: "regulatory action" in the context of the 2010 regulations should really read "political action" as the fact that the cuts happened then was more a function of political will than ICASA actually getting it right
 
Didn't CellC state that they desperately needed the asynchronous termination rates to stay in business. I recall them saying something like their 99c/minute rate was only sustainable if the new rates were implemented. Now I'm wondering, is this not a ploy by MTN to test the truth in CellC's statements... kind of like, how low can you go... and if you go this low, is it sustainable??

I doubt very much so that MTN (really,seriously) intend to make this 79c permanent... cause now the new termination rate is klapping them, and they given up some revenue to keep market share... it's going to hurt them pretty badly should the new termination rates be made permanent!
 
Nefertiti said:
Im feeling :sick: because as a contract person I pay more than double their promotional rate, so I am definitely going to change to pay as you go or which ever package gives me the best rate. Wouldn't it be the day that ICASA says that their 75c should be standard across all their packages. But I guess I can only dream.
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Why stay with them, then?

Falco said:
Well I moved to Cell C a while ago, not regretting it for one day.
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This.
 
on the "political action" front we also have to understand that the lag to a third mobile operator and the division between fixed line operators and mobile operators was a "political action" whether CellC has been particularly smart is completely irrelevant to the fact that the presence of additional players in the market not forced to terminate at prices determined by entrenched incumbents should lower the pricing.

Almost the entirety of MTN and Vodacom's brand strength is a product of monstrous advertising spend and more than half a decade head start which was supported by "political action".

The contract vs prepaid clash really is interesting.
 
RichardG said:
Cut on advertising more like it...

Still not convenienced at the rates becoming permanent more like keeping their current customers happy before they port away.
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As somebody else said there brand is really where there power lies. The reality is that they are trying to keep high branding spend without loosing the market looking for the cheapest product temporarily. VC and MTN know long time customers stick unless they get seriously pissed while network hoppers and multi sim users are hooked by pricing. Vodacom's on net promotions attract a fair number of people with a Vodacom sim just for Vodacom calling.
 
Falco said:
Well I moved to Cell C a while ago, not regretting it for one day.
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Yea, I am waiting for them to get the Sony Xperia Z2 :D

though as a side note, Im going to get a new number, not porting the mtn one (but still have a small amount there). Splitting business and personal activities :)
 
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