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01.02.2005 Feature Article

Spacefon: Shrewd Business Vs. Ignorant Consumer Society.

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There was no particular secret, as far as I knew, about where the finance for Sandcastle had come from, but it was up to Oliver Knowels to reveal it, not me. I thought Calder would have been interested, but bankers' ethics as usually kept me quiet. [Dick Francis, Banker, Putnam, 1982, p. 106]

I have opened my short expose with the above quotation not because I abhor industrial secrets but some can be potentially exploitative in societies that have ignorant consumer based associations. Unfortunately in Ghana we do not have any credible consumer associations. In the absence however, every individual has a duty to ensure he or she is not cheated. Quite recently I chanced upon a discussion involving a close relation and an official of Spacefon, undoubtedly Ghana's best wireless telecommunication company. My relation was buying the wireless telephone set ingeniously introduced by Spacefon for consumers who operate the “Mobile to Mobile” service.

It was pointed out to the official that there was no substantial difference in their credit billing of ordinary handset users and that of the “Mobile to Mobile” operators. Let's illustrate. A 250 credit card for an ordinary personal phone costs ¢75,000.00 and 3000 credits for “Mobile to Mobile” operators costs ¢870,000.00. When you divide 3000 units by 250 you get 12. Multiply 12 by ¢75,000 and you get ¢900,000.00. This is only a ¢30,000.00 difference between the two users. Spacefon exacts 4 units per minute across board even if you took care of peak charges and off-peak charges. I have also learnt from the operators that Spacefon's per second billing only applies to personal handset users. So in the end there is no difference at all. Yet, the impression is created that substantial profits accrue and the machine is sold currently at ¢7,000,000.00 while a Nokia 3310, the most popular mobile phone in Ghana which can serve the same commercial purpose goes for ¢950,000.00. “Ah well” the Spacefon official sighed “Its your fault, you Ghanaians do not ask questions. You take everything brought to you”. He went on. I will take the case up with management but I would be asked what concerns me if people are buying and my salary and other benefits are not threatened”.

Without any cynicism I decided to do this write up with the intention of bringing the matter to the fore so consumers would pressurize the communication giant into doing differential pricing of its credits for users of the “Mobile to Mobile” since they employ people to operate so they can give them decent wages after sitting under the tropical heat the whole day. Secondly, to reduce the price of the machine as I have heard in some quarters that the true price is ¢4,000,000.00 or less. Even though I agree that the distribution chain could drive prices up, it should not be to such ludicrous levels. It is only in Ghana and perhaps most parts of Africa that when a product becomes popular an artificial shortage is created in order to drive the price upwards whereas in the West, it means economies of large scale, reduced prices and maximum profits.

I do recognize the corporate social responsibility role Spacefon plays and the innovation is welcome, since the inefficiency of the state's Telecom operator made it difficult technically and financially to access mobile phones from a landline. Many Ghanaian youth have been employed as operators are dotted all over the major cites of Ghana. Commerce is brisk, but it can be better and with a humane face.

A Philosophy lecturer quoting from the work of Forest MacDonald, Novus Ordo Seclorum once said “In 1769 [Benjamin] Franklin had written to his friend Henry Home, Lord Cames, the Scottish jurist and philosopher: `There seems to be but three ways for a nation to acquire wealth. The first is by war, as the Romans did, in plundering their conquered neighbors. This is robbery. The second is by commerce, which is generally cheating. The third by agriculture, the only honest way....'"

Spacefon like all economic entrepreneurs may believe in the creative power of cheating which is not essentially a bad thing for instance, when it undercut the state monopoly's hoodwink on communication costs, but they have a duty to listen to the consumer especially when he becomes aware and wants to maintain the good will. Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.

Franklin Cudjoe
Franklin Cudjoe, © 2005

The author has 119 publications published on Modern Ghana. Column Page: FranklinCudjoe

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