Onic help : Ads touting the “first digital telco” with the least expensive data plans in the nation have undoubtedly inundated you. With a youthful logo, an intriguing color scheme, and a lot of hype, ONIC has launched its marketing campaign and is now accessible on social media almost everywhere. However, what precisely is ONIC, and what makes it novel?
The Basics
“A digital platform that offers seamless connectivity, effortless accessibility, and endless opportunities to engage, create, and collaborate whenever and wherever you want,” is the way Onic, a “digital telco” describes itself. We achieve this by providing straightforward, worry-free, high-data plans that are offered via a digital-first interface, together with enticing lifestyle incentives and offers.
That’s a lot of corporate jargon without actually explaining anything, so let’s try to cut through. Many individuals believed that ONIC was a recent arrival in the nation, most likely a Mobile Virtual Network Operator. The Pakistan Telecom Authority, however, made it clear that this was untrue and that the brand was actually owned by Pakistan Telecommunication Company, which is Ufone’s parent company.
In essence, an MVNO is a telecom company that uses the infrastructure of another reputable operator, or MNO. By doing this, the operator can still provide creative value additions without having to incur the initial sunk cost, all while eliminating the first costly step. The main advantage for the MNO is that it can make use of extra capacity. The Framework for MVNO Services in Pakistan was unveiled by the PTA in 2009, with a $5 million license fee. | Onicinfo |
However, what is ONIC? In his bio, at least one person in a leadership position stated, “Building Pakistan’s first MVNO.” The Pakistan Telecommunication Company (PTC), which is listed on the stock exchange, is required to disclose any information regarding the acquisition of licenses of this kind, but there has been no report of ONIC obtaining any. That ONIC is merely a new brand is confirmed by this. Those who aren’t lockdown babies would be familiar with Telenor’s Djuice. It was the first to offer inexpensive SMS packages and was once the hip thing. Therefore, it resembles that somewhat.
These sub-brands are referred to as “digital attacker” brands by Mckinsey, which also asserts that within four quarters of launch, they may contribute approximately 25% of the total gross additional subscribers to incumbent operators, and that these subscribers are 5% more profitable than the regular ones.
Circles | Life x e&
Etisalat’s rebranding as the Emirati telecoms company rebranded itself as e& led to the launch of ONIC. It revealed its grand ambitions to become a worldwide technology conglomerate last year. In April 2023, it also acquired a $400 million stake, or 50.03%, in Careem’s super app business. In order to “empower its network of Mobile Network Operators (MNOs) and other operators based in the region to launch digital telco brands that deliver delightful digital experiences for the digitally savvy generation,” e& International and Singapore-based technology company Circles entered into a strategic partnership on May 24.
With the help of Circles’ technology and platform, Circles X, e& will be able to introduce digital telco brands throughout its numerous subsidiaries. CircleX claims to be able to help MNOs launch digital brands in as little as six to twelve weeks, avoiding the institutional inertia and legacy systems associated with more established networks.
The rationale behind new brands | Onic
In the telecom space, flaming brands are nothing new; operators all over the world have tried this tactic out. More than 200 of these sub-brands have already been introduced, according to GSMA Intelligence. The objective is to tap into various consumer segments, frequently by presenting oneself as a stylish substitute for younger audiences.
The question now is: What motivates PTC to take this action? To understand that, let’s take a look at some economics and history. As other telic jumped onto the 4G bandwagon, Ufone chose to stick with 3G and missed the memo. As a result, Ufone just recently reached 15 million customers across all technologies, whereas the other providers each have well over 20 million subscribers for 4G alone. | Onic |
Let’s move on to economics now. As you can see, voice sales formerly accounted for the majority of the revenue for telcos. mostly due to the fact that most people were communicating via WhatsApp and other messenger apps. In contrast to business-to-business communications, personal texting has essentially vanished, and value-added services have also begun to fade. The average revenue per user, which was just PKR 232 in July–September 2022, has been severely impacted by this as well as the depreciation of the rupee.
Increasing the number of customers who use broadband rather than just voice is necessary to push it up. And that’s where Ufone, ranked fourth, truly falters. This helps to explain the marketing campaign that emphasizes being digital first and offering high-volume data packages at low costs. How do they accomplish that?
To begin with, the packages are created with data first; even the most basic one costs PKR 890 and offers 30GB. Up to 200GB is the maximum, which is nearly comparable to some fixed broadband providers. Voice and messages are secondary and often overused among new brands, such as MVNOs. ONIC is providing 1,000 SMS and 5,000 minutes (without making a distinction between on and off-network usage). Onic
Risk and Reward
We attempted to compare ONIC’s pricing with that of existing providers and developed a simple price-competitive index1. While Telenor surprised everyone, ONIC came in second. What’s surprising, but not surprising, is that Ufone comes in last. As a result, it’s easy to see why it’d want to launch a digital brand to shake things up.
Even though initially low prices might entice customers, can they be maintained? especially in light of the fact that telcos are finding it difficult to even maintain their ARPU growth. The departing CEO of Telenor recently discussed this and their desire to concentrate on higher-value customers. That change has also been observed in tech companies. Nevertheless, e& has enough cash on hand to continue bleeding money for extended periods of time. See if they do, then.
Correction: This article originally said that Etisalat had bought a share in Careem. It was not in the ride-hailing industry, but rather in Careem’s Super App. Methodology: MBs, minutes, SMS, and price variation from the sample monthly plan were used to create a weighted multi-variable index. Using their proportionate share of telecom revenue, the weights were determined. The number of GBs in the sample packages’ plans was chosen to be close to ONIC’s standard monthly package. A weighted ratio that assigned greater weight to off-net minutes was used to standardize on-net and off-net minutes. Onic
