MTN lags in Nigerian market
LOSS of market share in Nigeria, one of MTN's most lucrative markets, is a huge concern for the telecoms giant, CEO Sifiso Dabengwa said at the release of MTN's interim results this week.
MTN held half of the market in Nigeria at the end of last year, but now only holds about 48%, after MTN subscribers in the country grew at only 3.7% from about 41.5million to 43million.
Dabengwa said there was aggressive price competition in the region, which meant MTN's prices were about30% higher than competitors'.
The effective tariff in Nigeria also decreased, affecting MTN's revenue growth in the area negatively.
Dabengwa said MTN had reduced its tariffs in Nigeria, but they were still at a 10%-15% premium to competitors'.
In the South African market, MTN grew its subscribers from 22million in December 2011 to 23.5million by June 2012.
However, MD of MTN SA Karel Pienaar said the South African operation might be unable to sustain current profit levels due to the rising price competition in the market that had resulted in declining tariffs, particularly of rivals Cell C and Vodacom.
The subscriber base in Iran rose 10.4% from 34.6million subscribers to 38million.
Dabengwa said the company experienced difficulty getting money in and out of Iran as the US tightened sanctions against Tehran.
"At this stage, because of the discussions we have been having with the US and SA authorities, we have not done any transfers for about six or seven months, but we are getting a good response from the authorities," Dabengwa said.
Syria was also a concern for the group, but Dabengwa said the safety of staff and their families was prioritised above all else.
MTN now has 176million subscribers and reported revenue of about R66-billion for the first half of the year, an increase of 17.5% on that of the previous first half.