SMS Subscription Services Bring In Substantial Revenues For MNOs

Mobile Phone - SMS - Zimbabwe, Mobile Penetration

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When I receive these types of message from Econet I always shrug my shoulders and think, “does anyone play this?” Well, it turns out these Value Added Services bring in significant amounts on a yearly basis.

Going through Econet’s annual report for 2019 here’s how some of the SMS based value-added services performed:

  • Econet’s music and infotainment segment which included services such as Comedy Box made ZW$7.5 million and acquired over 600 000 customers
  • Play for Free trivia contributed ZW$1.7 million revenue in the first half of the year-ending 28 February 2019
  • In the second half Spin and Win was introduced earning revenue of ZW$1.2 million
  • Play for Free and Spin and Win amassed 800 000 customers

Interestingly another SMS related product which brought in a significant amount of revenue for Econet during this time was the introduction of the Bulk Messaging Portal which brought in ZW$5 million.

VAS services can bring in a healthy string of income and another example of this is Telecel Zimbabwe’s deal with an Egyptian Telecoms company to help them design their VAS services.

Whilst Telecel doesn’t publicize financial and annual reports there is a way to estimate how much they might have made from VAS with one unfortunate caveat – the timeframe this money was made is not specified.

This information became public after ARPU -the company that was contracted by Telecel to make these VAS services- didn’t get their money and decided to take the local telco to court.

ARPU is owed $749 000 by Telecel which was 30% of subscription fees collected. This means Telecel made US$2.49 million from subscription services that rely on SMS’. Obviously, without a timeframe it does make it a bit cloudy but that’s still a lot of money…

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One thought on “SMS Subscription Services Bring In Substantial Revenues For MNOs

  1. I personally think some of these “services” should be regulated, requiring explicit opt in.

    In most instances subscribers have to opt out, at their own expense “SMS STOP to unsubscribe”, or they don’t even have the option, yet they are involuntary participants receiving unsolicited SMSes everyday to promote the “service”. It is effectively SPAM to be honest.

    A number of these services are also a form of gambling, whilst being peddled lightly as games.

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