(Business in Cameroon) - On January 30, 2015, mobile phone company Orange made its first manoeuvre against its main competitor in lowering calling rates in Cameroon. While it is true that both telecom companies have been reducing their per-minute rates, it should be noted that this reduction does not involve the whole minute. With both companies there are conditions that apply.

On its website, Orange indicates that the per-minute rate of 15 FCFA is only available after activating a short code along with adding more than 500 FCFA in credit. The 15 FCFA is also only for domestic calls within the company’s network. Outside the network, the rate per minute is 60 FCFA. With less than 500 FCFA worth of credit, the plan subscriber can no longer receive the 15 FCFA per-minute rate. The rate would be 20 FCFA. After activating the plan, the offer is only valid for two days.

At MTN, the set-up is similar. The MTN 25 plan is also a package that can be activated using a short code. The difference with Orange is that it local per-minute rate is 25 FCFA, regardless of the amount of credit the customer has. The rate to even other networks is 60 FCFA and the plan is valid for three days.

By slashing prices, the MTN and Orange seem to be using a dumping-oriented competitiveness strategy. They are lowering their rates to go on the offensive on the market knowing that they will have easy profit margins. The price of voice communication, though included in the plan, lowers and raises the consumption levels of customers who wish to chat longer. The short term limit on these plans encourages renewals. This is certain to have a ricochet effect on the companies’ average revenue per user (ARPU).