Cell C wants to buy your old contract

Cell C. (Duncan Alfreds, Fin24)
Cell C. (Duncan Alfreds, Fin24)

Johannesburg - Cell C’s chief executive says an initiative to give customers up to R10 000 to help buy themselves out of contracts with other networks could last longer than just four months.

The mobile network on Wednesday announced the launch of its contract "buy-out" proposition, which aims to help the company win over more contract subscribers.

According to data released by Cell C on Wednesday, prepaid makes up 60% of its overall service revenues.

To expand its customer base, Cell C says the biggest barrier to customers switching contracts are cancellation fees for early termination. And the company says postpaid and TopUp customers from other networks can qualify for amounts of between R1 000 and R10 000 “plus a new handset” if they sign up for Cell C’s new Epic plans.

Cell C CEO José Dos Santos told Fin24 that the initiative is planned to last four months, but that it could be extended if proved to be successful.

“The portion of actually buying out a contract, you know, we've just said look we're going to make this available for the next four months or so,” Dos Santos said.

“But if the consumer responds then, then the consumer supports us. Then why would we stop? Anything like this is based on the demand,” he added.

Mobile networks typically launch promotions in a bid to win over customers in the short-term.

But Dos Santos said that the buy-out offer is not a promotion.

"This is not a promotion hey. You can't call this a promotion,” Dos Santos told Fin24.

"The regulator says a promotion is only allowed for three months,” he said.

"The whole objective here is ...how do I get the next three, four, five hundred thousand contracts onto Cell C over the next couple of months,” he added.

No increases

Regarding its buy-back plans, Cell C is also promising that customers who sign up for the Epic contract packages will not be subject to any price increases for the duration of the contract.

Current Cell C customers will also be eligible to migrate to the Epic packages, the company has said in a statement.

Meanwhile, Cell C’s push to win over contract customers comes as it also says it is beefing up its data network.

"There's no point in me paying you R10 000 to get on board, and then I don't have the service, right. Then what's the point. Then I'm just taking good money and throwing it after bad," Dos Santos said.

"The Epic is a new tariff. The new tariffs that are data centric tariffs,” he said.

Cell C this year has finally joined the LTE race, after rivals Vodacom and MTN launched the high-speed mobile broadband offering in 2012.

Cell C is building an R8bn LTE network that is intended to connect urban areas in South Africa - such as Gauteng, Cape Town and Durban - to high speed internet.

Would you take up Cell C's contract buy-out offer? Tell us your thoughts by clicking here.

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