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How Vodacom is changing the way you use – and pay for – the internet

Market leader’s Meg Your Day prepares us for a future of snackable, app-specific bundles.

Vodacom’s Meg Your Day promotion, which offers subscribers up to 1GB of free data to use on specific services/apps, is changing the way we use the mobile internet. Of course, Vodacom is not giving away free Facebook, Instagram and video data for some altruistic motive. Rather, it is training us to get used to the idea of data bundles for specific applications or services. Here’s how (and why):

Meg Your Day, which runs from mid-June to end-September, offers Vodacom customers with a data balance (and smartphone) free data for specific apps/services on each day of the week. They need to opt-in to this daily. So, for example, on Mondays subscribers get up to 1GB of Facebook data (these bundles run alongside your ‘normal’ one and balances are available in the app). Video services (sports and YouTube) are reserved for Saturdays and Sundays when its network is generally under far less load. 

Picture: Supplied

First, this drives a change in behaviour where customers begin to get used to opening the My Vodacom app every morning. The importance of this cannot be underscored enough. This operator expects this channel to be the primary interface with customers and it is already using this to surface user-specific, personalised offers. These “Just 4 You” voice and data bundles are already being used by nearly ten million customers, with 728 million offers sold to end-March (an increase of 150% on FY2016). Behind the scenes, big data and machine learning is being leveraged to provide real-time, segmented and contextual offers to customers. This change to segmentation and accurate targeting drives spending and consumption.

The free data being offered during the Meg Your Day promotion is a tactical way to get its 20 million-plus data customers to get comfortable with app-specific bundles. Of course, this drives additional consumption on days when the data for Facebook, for example, is not free, but this is not the point.

Vodacom has quietly started promoting app-specific bundles to customers via SMS. So, for example, you might receive a message on a Saturday (because it “knows” you’re mobile and not connected to Wi-Fi, plus it has a handle on your historical usage of free Instagram data during Meg Your Day) offering 250MB of Instagram data for R12. Buying a 250MB bundle outright costs R59, so one can see the appeal here. Offers are accessible via the *634# USSD code.

These are not likely to be huge multi-gigabyte bundles. They’ll be what the operator terms “micro bundles” (think 20MB, 50MB, 100MB, etc.) and will generally expire at midnight (i.e. same day).

Picture: Moneyweb

In the bandwidth-intensive video space, Vodacom has also launched bundles for video-on-demand (VOD) consumption. So, 1GB of data to use on Showmax, for example, costs R75 (versus R149 for a ‘standard’ 1GB bundle). Expect further iteration to include other services as well as allowing for scheduled (after peak) downloads at vastly reduced prices.

Picture: Moneyweb

Given that bundles, particularly in the data space, are the cornerstone of Vodacom’s strategy, this innovation is not going to stop. It has been a trailblazer in the bundle environment (think back to the highly successful “Power Hour” and derivative prepaid bundles). Rivals MTN, Cell C and Telkom have a lot of catching up to do… WhatsApp bundles are not going to cut it. It is going to be especially interesting to see what strategies MTN implements from its other markets (where there tends to be a lot more innovation than in its home operation).

From a consumer point of view, these app-specific bundles mean lower prices. Older customers (“olds” as the millennials call them!) likely won’t fuss with this sort of thing, but the younger generation are savvy. Instagram and Facebook (with their increased focus on video) and YouTube consume a ton of data and this will help force the change in behaviour.

Finally, from a regulatory point of view, this move to app-specific bundles will see a further abstraction of tariffs, i.e. the prices we pay for data and voice, from those filed with the Independent Communications Authority of South Africa (Icasa). Already, it is entirely unclear how Icasa could hope to regulate data tariffs on personalised/segmented offers. Trying to do so, or to regulate any app- or service-specific bundle is neither practical nor constructive (or indeed desirable). Let consumers choose. 

*Hilton Tarrant works at immedia. He can still be contacted at hilton@moneyweb.co.za.

*He owns shares in Vodacom, first purchased in June 2013.

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Prefer to stick to Telkom data – just can’t figure out what Telkom means by “night surfer” data.

But Vodacom also gives free airtime; if you’re pay-as-you-go, and buy R50 airtime, for instance, you get 50% (R25) of the purchased value free. This expires midnight on the day.
It therefore makes sense to rather buy 5XR10 airtime – that way you’re more likely to get more benefit from the free airtime unless you make calls of R75 a day. Most people probably don’t use as much as R75 airtime a day, but less.
So to stock up with a whole lot of R10 slips that you use only as you need, you don’t lose much free allocation when midnight arrives.

Night surfer is data that is consumed between midnight and 7am, between those times it will use any night surfer data you have, if you have none or have used up all your night surfer it will use your anytime data. Telkom has a 500gb for R50, with 30 days expiry, night surfer data bundle for the night owls.

Rather prefer the 10GB for R199 type deals Telkom offers, I can use that data for anything. I am not a monkey that needs to be trained by Vodacom to accept short life, limited use, expensive data.

Lets use an example. R75 for 1GB of ShowMax data? So if you want to watch 10 days (about 3 hours per day, on ShowMax lowest setting) it will cost you R750. Might as well just get Telkom 10GB prepaid data for R499 that you can use for anything.

Vodacom may think this is a smart move, “training” the monkeys who subscribe to their service. But life does not happen on specific days, so I choose to pay a fair price for my data (Vodacom’s out-of-bundle data is ridiculously expensive) so I can use it anywhere, anytime, any way I like to.

Guess Vodacom is so addicted to the high profit margins of their normal bundles, they cannot even phantom the idea of just lowering their prices a bit now and then. How long has 1GB been on R149? One can by 2GB with another provider for that price and still have change left.

Very dangerous to have a ‘closed’ internet where Vodacom’s preference is what matters. Introduces a significant barrier to entry to new players. It’s a form of censorship too.

The concept of specific apps should be fought in the strongest possible terms. It is the beginning of removing net neutrality. Before you know it, VC and the service are paying each other and we no longer gain access to competiting services.
We just want cheaper data to access the net, not for VC to choose which services to access.

Vodacom data prices are quite far off market rates roughly 50% more expensive than Telkom and Cell C it seems? I guess they have very loyal corporate clients to be able to do that. Not really a sustainable or smart strategy though..

Vodacom,go kiss my dual SIM Redmi 4A smart phone with your apartheid-style “we will choose your data usage” attitude. I will use my data as, when and where I wish to, not you wish me to.

It is better to be a Vodacom shareholder than an unfortunate trained monkey client of theirs. Remember how SMS got alive? First it was for free…

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