Why Safaricom is keen on growing data usage, and a snapshot of MSwari - Safaricom CEO Bob Collymore answers
How do you see proportion of voice and non-voice revenues?The proportion of voice to total revenues has steadily been going down over the years. It was 65 per cent last in 2012 and is now at 62 per cent. It probably will go down further to 60 per cent this year.
Inevitably over time, we may have voice revenues account for less than half of revenues, but we can’t tell when.
But voice will not decline. Voice is growing at a slower rate than non-voice streams. Voice grew 13 per cent compared to non-voice revenues which grew 29 per cent to account for 33 per cent of total revenue.
M-Pesa grew by 29 per cent, SMS 30 per cent, mobile data 21 per cent and fixed service 54 per cent. That means we need to innovate more products such as M-Pesa, data and SMS.
What is your plan in growing mobile data revenues?When a consumer upgrades from using a feature phone to a smart phone, the (average revenue per user) ARPU more than doubles from Sh500 to Sh1,200 the first time the consumer moves.
This is a one-time ARPU change. Moving on, the spend may not alter much. Upgrading customers to smartphones helps drive other streams such as data and SMS.
We have managed to grow the number of smartphones in our network from 400,000 to 1.3 million last year. We spent a total of Sh400 million to subsidise the devices.
We are creating the Safaricom appstore to have locally relevant applications for our users. We will be holding the Safaricom AppStar competition to drive and reward innovations in mobile applications.
Give an update on your metro fibre networkWe have just begun a five year programme to build our nationwide metro fibre network with the goal being to connect all of our metro sites and customer offices to fibre. It is a Sh10 billion project.
So far we have done 76 kilometres. It’s been a slow start because getting way leaves has been a problem. We plan to lay 550 kilometres of fibre this year. This will position us to earn more from data.
What are your revenues from M-Shwari?We already have 1.2 million active customers using M-Shwari, but the revenue from the service is very small. It would be immaterial to include it in the financial statement.
We don’t see it as a material revenue stream for us now. It’s a long term product, and we give it 2-3 years to mature and contribute significantly to our earnings.
But for us, its value addition to M-Pesa to allow users to save, earn interest and access micro loans using their mobile phones. It’s a financial inclusion tool.
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