Vodacom said On Tuesday, they have begun locking the network of several smartphone devices for the first time in years.
The chief officer of the company's Consumer Business Unit, Jorge Mendes, told reporters at a media briefing that, contrary to popular belief, there are no regulations preventing South African operators from cellphone locking networks, preventing them from being used outside the network where they are sold.
This practice is common in many markets, including the US.
Mendes stressed that the Vodacom move should not be seen as anti-consumer, but rather as a way for operators to subsidize handsets more aggressively, especially at the initial level where affordability is the main problem.
First National Bank's virtual cellular network operator, FNB Connect, became the first market player in at least a decade to sell network-locked phones when introducing new models about two years ago.
The main operators have moved away from doing this after the "men's agreement" between them that they would no longer do it.
But Mendes said the market had changed and there was a need to make smartphones more affordable for end users. One way to do this is to lock the cellphone for a period of, say, 12 months. He said Vodacom's main rival was also experimenting with "small amount" network locking.
He said the company had begun locking thousands of devices for a one-year period to test consumer reactions. Users can unlock the device if they want, provided they pay a "small fee".
"This gives consumers a choice – to pay R799 / month for open devices or R599 for network-locked devices," he said. "If you have made the choice to be on the network, the R599 proposition attacks you immediately."
Consumers, he stressed, would have the choice to choose an unlocked cellphone, but might have to pay more for it than the network-locked version.
"We are ready to invest more aggressively to reduce prices, but we need protection so we can get a recovery from that investment," Mendes said.
Meanwhile, Vodacom said it hopes to shut down most of its inherited 2G network in the next five to six years after transitioning all of its retail clients to 3G and 4G handsets.
"There is a significant investment to accelerate the plan; we see what we can achieve. This is a big investment and needs to be an industry-led initiative, "Mendes said.
Vodacom will continue to maintain "very thin" 2G so services such as vehicle tracking and water and electricity measurements, which used the previous 2G carrier, were not affected. – (c) Media News Center 2019