In January, Orange, the French telecommunications company, is set to open a store in Cape Town, and according to reports it promises to cause a stir in the local cell phone market by undercutting prices. Orange already sells cell phones, tablets and other electronic goods through its online store.
Vodacom and MTN have also introduced more affordable smartphones; to not only connect everyone more effectively, but to make the mobile market more affordable in South Africa.
With Orange already having an online store, and now a physical one, the competition in the South Africa mobile sphere might be heating up.
"The response to the Orange online store from the South African market exceeded our expectations," says Orange Horizons CEO Sébastien Crozier in a media statement.
"This led to a local warehouse being established to service this market, and now the opening of our first retail store in the country," added Crozier.
Besides selling the usual gadgets, as well as being a point to pick up and drop off phones for repair, the Orange store will provide international mobile options for South Africans travelling abroad.
The competition
"The affordable smart device range captures the consumers wishing to migrate from a feature phone to their first smartphone, data usage from these consumers is growing depending on their needs," said Larry Annetts chief marketing officer of MTN South Africa.
Vodacom shared these sentiments with MTN, also introducing more affordably priced smartphones.
"Introducing high-quality, low-priced devices is just one leg of our three-part strategy to connect South Africa. The first leg is the network itself – we're investing R9 billion across South Africa this year [2014] to expand both the reach and quality of our coverage," said Phil Patel, Vodacom's chief commercial officer.
MTN went on to say that they welcome the competition that Orange will bring, by opening a physical store.
"MTN welcomes the competition new entrants bring into the telecommunications space. This is indicative of an open market and showcases the abundance of opportunities that are available in the telecommunications industry even for companies who do not have any investment in South Africa," said Ahmed Farroukh, the CEO of MTN South Africa.
However, Vodacom told Justmoney that they are "very much focused on [their] own business and can't really comment on what other companies may be planning."
Affordable devices
MTN pointed out to Justmoney that it too has similar affordable devices, such as the R499 Steppa smartphone.
"MTN has introduced a bouquet of low end devices such as the Pixie 7 and the immensely popular MTN Steppa that appeal to the needs of the lower end of the market," said Annetts.
Mobile providers are trying to boost revenue with lower data costs, entry-level smartphones and tablets to meet consumers' growing technological needs.
The added competition by Orange could mean that South Africans can look forward to cheaper smartphones and tablets in the near future.