ICT Policy



City Profiles

PBS Newshour examines SA’s ‘technical divide’

July 6, 2010  »  MobileOne Comment

[If you have Flash Player 10, then you can watch the embedded video here. If not, head over to the PBS site to watch the video, listen to an audio file, or read the transcript of the interview.]

In light of the World Cup, PBS Newshour has created a segment examining mobile costs and how one telecom company competes with Vodacom and MTN. It seems as if the folks at PBS sought an innovative story, hence the selection of nascent Dabba Telecom.

For better or for worse, the piece acts as a marketing tool for Dabba, painting South Africans as ordinary people who are simply trying to make ends meet. As such, they should not be held at the mercy of a non-interventionist government or large telecoms who play the cost blame game. The founder of Dabba is even likened to Robin Hood.

Regardless of the tone, PBS has the ability to reach a broad stateside audience. Awareness of the current mobile cost structure and the fact that innovation is happening in Africa are undeniably positive takeaways for typical viewers. Plus, Dabba’s business model is actually interesting:

  1. Dabba buys airtime in bulk at one rand, for example, and sells it at 1.2 rands. MTN and Vodafone charge upwards of 3 rand using this scenario.
  2. Dabba installs relay antennas in as many buildings/apartments are willing and routers connect the buildings to the Internet. Internet-based phones are made possible in this manner.
  3. Dabba provides customers with free phones.
  4. Dabba recovers its costs when customers purchase the requisite pre-paid airtime.

The company is experiencing rapid growth and expects to recoup its investment within a year-and-a-half. The ultimate goal, given a positive user experience and proven financial viability, is to apply the model to rural areas and other nations.