TOWARD THE WIDER USE OF DATA

Mozambique 2020 | TELECOMS & IT | VIP INTERVIEW

TBY talks to Jerry Mobbs, CEO of Vodacom Moçambique, on 2020 strategies.

What is Vodacom's strategy for 2020?

The three pillars of our strategy are to build more coverage, increase our customer base, and get them to use 4G data. The more people have smartphones, the more they can access the entire app ecosystem in the world. We have over 7.5 million voice customers, 4 million of which use data. A major push is to get them to use 4G. We started subsidizing 4G phone because the data rate in 4G is significantly better than 3G; so far, we have over half a million 4G phones. In terms of extending the network coverage, this is a balancing act. We continue to grow our coverage aggressively and add capacity to the existing coverage to accommodate the growing number of users, the increased consumption of data, and the rising demand for speed.

How do you measure against the competition?

The Mozambican market is dominate by three operators, which represents about the right balance. One is a monopoly, two is a duopoly, while too much competition means no one makes money, and therefore no one invests. In Mozambique, the competition keeps us awake at night and pushes us to constantly innovate and keep up with the innovations. We are pushed to bring prices down, extend coverage, and deliver a competitive service. The government also needs revenue and extended coverage for its own programs, so this is a win-win situation for all. In terms of our competitive advantage, we have the largest 4G network and the highest number of 4G sites. We are catching up quickly with coverage and high-quality service in the rural areas. The M-Pesa platform, where we have put in extensive effort over the last six years, acts as an important differentiator.

How do you leverage opportunities offered by the M-Pesa to increase competitiveness?

We have rapidly come to see M-Pesa as a distribution platform that services a social good; for example, financial inclusion of the unbanked. Around 60% of M-Pesa customers do not have a bank account. We are now introducing a Learn Market Place, whereby our 4.3 million M-Pesa customers can access loans from Mozambican banks and repay them, all through their mobile phones. We want this to be an open platform with all banks competing for our customers, thus providing competitive deals. Often, people in unbanked areas end up paying high charges because of the lack of competition; we want to provide a service that promotes financial inclusion and launch this in 2020. We signed an agreement with the first bank and are finalizing work on the platform, which will serve as a pilot. Based on default rates and risk levels, we will extend the network of banks offering loans through the platforms. The beginning will be slow, but we expect the take-off rate to increase through word of mouth. We are constantly looking at ways now where our M-Pesa platform can facilitate the growth of other sectors. For example, we are launching a partnership with energy company Fenix International to put in a high-capacity high-quality solar panel system repaid over M-Pesa. A great solar power system can cost up to USD100, which is a large sum of money when income is measured on a short daily or weekly basis. The goal is to make the daily usage of this solar system and collection down. This is where M-Pesa plays a role.