Dubai: Emirates Integrated Telecommunications Company (EITC), the parent company of du, said that its prepaid mobile segment is continuing to decline in the UAE but its focus on premium prepaid subscribers is bearing fruit.
Osman Sultan, CEO of du and EITC, said telecom operators are witnessing the same trend of falling prepaid revenues globally, due to the use of internet voice applications.
He said that the company is always in talks with Microsoft and WhatsApp for voice and video calling, but did not throw more light on the matter.
“We are closely monitoring this. Our strategy is to focus on high-end prepaid customers and the post-paid segment and that strategy are working well. That is why it is interesting to have a brand like Virgin Mobile, as it allows us to address some segment of the high end prepaid market,” he said.
The number of subscribers is not on their radar, he said, but the top priority is how to increase the value of shareholders and to increase operational efficiency.
In the third quarter, the operator has seen a 3.3 per cent decrease in third-quarter mobile subscribers to 7.71 million, compared to 7.97 million a year ago, but its mobile revenue increased marginally by 0.3 per cent to Dh1.78 billion in the third quarter.
Despite a significant drop in the number of mobile subscribers, Sukhdev Singh, executive director of market research and advisory firm Kantar AMRB, said that du has maintained its revenues due to a good traction among postpaid subscriber base among whom the ARPU (average revenue per user) is often much higher.
Sultan said that du is simplifying more and more of its plans and putting more offers in the market and facilitating the channels for postpaid.
“We cannot increase the prices as this is the trend in the telecom industry. We are working very aggressively to take customer experience to the next level and with the “more for more” option, we are offering much more for people who are ready to pay a little more. People who were using 1GB data before need 3GB, 5GB or 10GB now and that is paying results,” he said.
For the fixed-line segment, he said that increasing more of its reach in the country and adding more relevant content to its customers is their strategy.
The operator has a 16 per cent market share in the fixed-line segment in the UAE. “It is not surprising to note that the major impetus to growth for du has come from the fixed line, where it has witnessed not only a solid growth in subscribers, but also a strong improvement in revenues. The growth is likely to come from winning competition customers in traditionally Etisalat areas, in addition to tailwind from new subscriptions in new communities,” Singh said.
Sharing of fixed network infrastructure by both the telecom operators began in 2015, so that both etisalat and du could eye each other’s market share.
Both operators have marked their area of coverage, as du primarily serves the newly developed areas and free zones in Dubai and etisalat serves the rest of the UAE.
Singh said that with new real estate developments coming up in Dubai, du is expected to benefit the most and that is showing in its results.
The Dubai-based telecom operator said its capital expenditure has reduced this year, to around Dh900 million, but the investment is going to increase next year with 5G coming in.
“Operationally, we made excellent progress during the quarter in advancing our digital transformation agenda and cementing our growth to a fully integrated ICT player,” Sultan said.