Du consolidates low-income focus

Du is adding 100,000 customers a month with new service that offers no connection or renewal fees, but charges a Dh5 monthly fee.

A man speaks to a Du representative during the Mecom 2008 Exhibition, Conference & Summit at the Abu Dhabi National Exhibition Centre.

In launching a new mobile phone service targeting expatriate labourers, du has consolidated its focus on the low-income customers that represent the majority of UAE mobile subscribers. "We want to cater better for the specific needs of different segments of the community," said Osman Sultan, the chief executive at du. "This is a specific product for their needs." The service, branded "alo", was launched yesterday in Dubai. Along with a low monthly fee, it includes a direct hotline that connects workers with the government committee responsible for labour affairs, and will be used by the committee to send news and notifications via SMS. Special shops located near labour camps will sell the package, while du is organising for construction companies to arrange for new employees to receive the product. The idea for the service, which replaces connection fees and annual charges with a Dh5 monthly payment, was developed by Dubai's Permanent Committee of Labour Affairs (PCLA), which then approached du to become the commercial partner for the project. The branding of the new service shares similarities with Mobinil, Egypt's largest mobile operator, which Mr Sultan headed before moving to du in 2006. Mobinil also uses a similar shade of orange as its primary product colour, and its prepaid service is also named "alo", a common colloquial Arabic appropriation of the English word "hello". Mr Sultan said the choice of orange was made by the PCLA and the use of communicative words like "hello" and its equivalents was a widespread branding tool in the industry. The du chief executive said he doubted he would receive any angry phone calls from his former boss, Naguib Sawiris, the Egyptian telecommunications magnate who holds a controlling stake at Mobinil. "I still have a very good relationship with Mr Sawiris," he said. "I don't think that will be a problem." Since its public launch in early 2007, du has made a point of targeting what company officials call the "budget conscious" segment of the market, offering new mobile connections for Dh55 (US$15), a third of the price of its competitor, Etisalat. The company gained popularity in the segment by being the first in the country to introduce per-second billing, a system that can lead to small but significant savings for low-income customers. The new service "corresponds completely to our positioning and our brand values", said Mr Sultan. "We hope that by doing this, the company is perceived as a better corporate citizen." Mohamed al Marri, the chairman of the PCLA, declined to clarify whether Etisalat was also approached to offer such a service, saying only that the committee was very satisfied with du's interest in the project. Both Etisalat and du have been adding almost 100,000 new customers each month for the past year, saturating the market to the point where there are more than two mobile lines for every man, woman and child in the country. While boosting their subscriber numbers, the two companies have experienced stagnation - and in some periods decline - in the average revenue earned from each user, a key industry metric for sustainable growth. [e-mail]