MTN GROUP LIMITED - MTN South Africa announces outcomes from engagements with the Competition Commission

MTN South Africa announces outcomes from engagements with the Competition Commission

MTN Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1994/009584/06)
(Share code MTN)
(ISIN: ZAE000042164)
(“MTN” or “the Group”)

MTN South Africa (“MTN SA”) announces outcomes from engagements with the Competition
Commission (“CompCom”)


Further to the announcements on 4 December 2019 and 12 December 2019, MTN SA has today
announced the outcomes from its engagements with the CompCom and response to its Data Service
Market Inquiry (“inquiry”). MTN SA has developed a set of voluntary undertakings in the form of a social
compact to further address the affordability of data services for its customers and MTN remains in
discussion with the CompCom on the options to formalise these elective solutions and the
implementation thereof.

Included in these initiatives are three areas which focus on deepening MTN’s ongoing drive to reduce the
cost to communicate. These are: the affordability of monthly prepaid bundles, lifeline data and the zero-
rating of data for public benefit service websites.

With regard to monthly prepaid data bundles, MTN SA will, in April 2020, reduce the price of its monthly
bundles of 1GB and below by between 25-50% and specifically the 1GB monthly bundle will decrease by
33% to R99. This continues the work MTN SA has done to improve the affordability of data for its
customers, having already brought the effective rate of data on its network down by 76% between
February 2017 and February 2020.

In terms of lifeline data, MTN SA will provide each of its customers 20MB of free data daily – or the
equivalent of 600MB per customer every month – through its instant messaging platform, Ayoba. Ayoba
currently has 500 000 customers in South Africa and is expected to continue to scale through the lifeline
offering.

MTN currently offers zero-rated data access to a range of websites which includes schools, and
universities. These will form part of the broader public benefit website service. In April 2020, MTN will
extend the websites that form part of the public benefit service to also include health, public universities,
vocational colleges, educational resources as well as employment sites based on terms and conditions
and criteria defined by MTN and after application and approval from MTN.

From April 2020, MTN will launch the OpenTime service, which will be enable free access to public benefit
services through a link on this website. MTN SA will offer a monthly 500MB free data access to public
benefit services websites every month, amounting to 6GBs per year, for each of MTN SA’s 29 million
customers.

While there will be pressure on MTN SA’s short-term financial performance from these initiatives, MTN
believe that the reduction in pricing will be compensated over time by elasticity and customer growth,
and growth in prepaid data service revenue will return in a couple of quarters.

Radio spectrum is the digital highway upon which we depend to carry increasing mobile data at more
cost-effective prices. This is acutely felt in South Africa, which has among the lowest spectrum allocation
in all our MTN markets. The release of new spectrum in South Africa is urgently needed and will greatly
assist our ability to service increased customer demand in a more cost-effective manner.


Fairland
20 March 2020


Lead sponsor
Tamela Holdings Proprietary Limited

Joint sponsor
JP Morgan Equities South Africa Proprietary Limited

Date: 20-03-2020 10:37:00
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