Recently I had a discussion with a content distributor about the viability of Over The Top (OTT) and/or Video on Demand (VoD) content distribution models in Kenya, and the conclusion was the same story I shared here when Showmax launched in Kenya: Kenyans still don’t subscribe to OTT/VoD services; thanks largely to the absence of affordable Mobile Internet.
The cost of Mobile Internet has reduced drastically over the last decade, getting to its lowest when Airtel introduced their crazy Unliminet, but that was to be short lived as lack of revenue forced them to restructure the offer, then later do away with it altogether. Then Faiba 4G Internet happened, a low cost Internet that is based on an unpopular bandwidth, making its adoption rather lackluster.
Two years after Faiba 4G was launched it can no longer be considered the most affordable mobile internet in town. This is because from late last year Telkom Kenya decided to introduce a very appetizing internet offering – 30GB data for shs 1,000 only; an amount that gives you just 25GB on Faiba 4G.
The Telkom data offer however comes with a very big problem – the 30GBs are only available at 1GB at time for a period of 30 days. This type of delivery is not only disadvantageous to the customer, but to the provider too.
The disadvantage on the customer is that she will be forced to plan her browsing such that she has to consume the 1GB within 24 hours. If she consumes less, let’s say 700 MB, then the other 300MB will disappear just like that. If the trend continues for the next 30 days, she shall have lost almost 10GB of data. But we all know she won’t allow such a loss to happen. What she’ll do is to make sure she consumes the 1GB daily data before the 24 hours elapse (mostly by watching useless videos), then after her daily quarter is exhausted she’ll probably pay Safaricom or Airtel for the rest of the day’s browsing – and in this way Telkom Kenya shall have lost.
The loss to the provider, in addition to the little shillings the customer is likely going to give competing firms once the daily 1GB has been exhausted, is the foregone opportunity where a customer could have opted to buy the next month’s subscription after exhausting the current month’s data before the expiry date.
That is, if I were to buy Telkom 30GB data for shs 1,000, and I receive the entire data at purchase, then I would be free to use the data however I like, including the possibility of exhausting the entire 30 GB in a day, then purchase a new bundle immediately. But that cannot work because Telkom has decided to dish out only 1GB of that data per day.
In summary, the blunder Telkom made with its affordable mobile internet offering is in the decision to dish out the 30GB 1GB at a time. I cannot imagine myself using up the 1GB let’s say within the first 14 hours after purchase, then being forced to wait for 10 hours before I can browse again. If that is not psychological torture, then I don’t know what is. And as I have explained, this also cuts into Telkom’s potential revenue – where I could actually exhaust the entire 30GB before the month ends then I buy the next bundle way sooner.
So Telkom, now that you understand the blunder that you have made, can you restructure your 30GB offering so that I can jump right into it?
