Telenor’s latest earning report said that the company’s ARPU (Average Revenue Per User) for both prepaid and post customers declined during 2016 when compared to last year due to increased data usage.
The company’s ARPU by the end of 2016 stood at Rs. 205 per user per month, down from Rs. 212 per user per month a year ago.
This potentially translates into an equation which will mean that increased investments in 3G / 4G networks are ultimately going to hurt telecom operators. “Sadly, this could be the case if operator’s don’t stop their ongoing price wars and battles”, said an analyst who wanted to remain unnamed.
Not to mention, Telenor invested $395 million for 4G spectrum in August 2016 and has been spending money for last two years to stretch its 3G and 4G footprint.
“You need to be worried when telecom consumer’s average spending per month on telecom services is not more than four cups of tea”, said a high-up of telecom company while speaking with ProPakistani yesterday.
He pointed out that telecom revenues are on a decline for last two years despite network upgradation worth several hundred million dollars and other valuable offerings.
This calls for actionable measures from operators to deal with the situation before it’s too late. We are hearing that their headquarters are already rejecting — or the very least, not encouraging — any new investment plans.
Its time that telecom operators start thinking of things beyond number of subscribers and start offering quality and more sustainable services that could grow their business, not just the subscribers.
Telenor Q4 2016 Highlights:
Number of subscribers grew 14% (as compared to previous year) that resulted into 12% increase in revenues
EBITDA decreased by 4%
Capital expenditure increased due to 3G and 4G network roll-out, following the acquisition of new 4G spectrum earlier in 2016
More in below table:
We have successfully upgraded 3G services in Lahore and surroundings including Kasur, Sheikhupura, Raiwind and all the highways in the area”, said Rainer Rathgeber, CEO Ufone, while speaking with ProPakistani.
Rainer said that Ufone customers in these cities are already experiencing better speeds and quality on company’s 3G network.
CEO said that along side refarming spectrum, his company also invested on network expansion in Lahore region as Ufone has become first and only operator to have converted all cell sites in the city to 3G.
Mr. Rainer explained to ProPakistani that this will mean only better services and enhanced speeds throughout the city.
Ufone’s network in Lahore — during peak hours — gave us following speed-test results
Ufone said that it had already enhanced the network in Islamabad, Rawalpindi, Abbottabad, Sialkot and Quetta where its subscribers are now enjoying clear voice and faster 3G internet experience.
The CEO confirmed to ProPakistani that Ufone will be upgrading and refarmed its 3G network in other parts of Pakistan within the next few months.
Mobile Network is a Living Animal
Mr. Rainer said that they will continue to work and enhance Ufone’s cellular network. He said his company is constantly working on optimizing the network with an aim of offering best-in-class services to customers.
Without sharing any numbers, since Ufone is a private company, Rainer said that they will keep investing into network to make it a better offering.
Subscribers’ Numbers are Not Relevant
When we asked Rainer Rathgeber about decreasing number of Ufone’s customers, he said that SIM numbers are not relevant because they do not necessarily mean new customers due to the fact that now customers carry multiple SIMs in their name.
“Our focus is on real customers who enjoy our services and remain with us for a longer duration”, said Rainer.
Increasing the number of SIMs is not difficult, the CEO said, adding that ‘what’s the use of customers who sign-up, consume free resources and then leave your network without growing your business?’
“That’s pure dumping and wastage of resources”, he added.
“Luckily PTA has realized this now as well and that is why they removed ZERO priced SIMs from the market”, said Rainer.
He told ProPakistani that his company is doing better than before in terms of revenues and ARPU and that he is very satisfied about how his company has been performing lately.