Telkom’s killer mobile growth in charts

While Vodacom and MTN are still the dominant mobile network players in South Africa, Telkom has made substantial gains in sheer customer numbers over the last few years.

Comparing the latest available active subscriber data from the interim financial reports of the four biggest mobile networks showed Telkom significantly outpaced its mobile competitors when it came to new sign-ups.

Between the publication of their Q2 financial results for 2018 and 2019, Vodacom, MTN, and Cell C lost subscribers. This was again the case between 2019 and 2020.

Cell C’s performance was the worst, with a tumble from 16.3 million to 11.72 million. The operator was also forced to close several stores and retrench employees.

Whereas Vodacom and MTN generally compete on quality, Telkom and Cell C’s main value propositions are in their pricing, which means they generally compete for similar customers.

While customers wouldn’t expect to have the high network quality of the heavyweights, they do expect more affordable packages.

Evidently, Cell C’s loss was Telkom’s gain.

In stark contrast, it surged year on year, more than doubling its subscriber count over the same period and surpassing Cell C’s position to become the third-largest mobile network in the country.

Between September 2018 and September 2020, Telkom’s subscribers jumped from 6.55 million to 13.69 million, an increase of 148%.

Vodacom saw small growth of around 3%, while MTN managed 8%.

The table and chart below show how the subscriber numbers of the four major mobile networks changed between 2018 to 2021.

Telkom’s aggressive pricing and clear focus on high mobile data value are among its strongest selling points.

The company first ventured into South Africa’s mobile market under the 8ta brand in October 2010.

From the onset, it struggled to compete with the consumer trust entrenched in Vodacom and MTN. At the same time, Cell C had also become more well-established as an affordable alternative.

Three years after its launch, the company had still not turned a profit.

However, Telkom did not give up on its mobile ambitions and decided it might be best to leverage its well-known brand to grow customers, renaming 8ta to Telkom Mobile in 2013.

It took another five years to double its subscriber numbers, but after 2018, Telkom’s subscriptions accelerated.

Outgoing Telkom Group CEO Sipho Maseko has repeatedly emphasised the company’s clear shift from a singular focus on fixed-line, to mobile connectivity.

The company has invested heavily in its mobile network, while its wholesale fixed-line division has taken a beating.

Out of the four big mobile network operators, Telkom now accounts for more than 15% of subscribers, almost half of MTN’s customer base.

It achieved this feat in about 11 years, while MTN has been around for 27 years.

The portions of mobile network subscribers under each of the big four networks are shown in the chart below. Note that the percentages might not add up to 100% due to rounding.

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