Unless you fell down and got stuck in a crevasse in the middle of nowhere you should have noticed that Virgin is attempting to enter two “fiercly competitive�? (*laugh*) markets, namely those of cellular operators and banking.

Virgin’s recently launched credit card offering (Virgin Money) is actually pretty competitive, at least for their intended target market from what I understand. Obviously they can’t beat the platinum card offerings for those of you who earn in excess of R400kpa?

On the other hand, I’m not so sure about their cellphone offering (Virgin Mobile). Sure, having a fourth network operator should improve competition and (hopefully) drive down prices in the long-term, if not the immediate short-term, but right now their prices don’t appear to be that much better than the competition.

I can’t quote any statistics or numbers, but I’d be willing to bet that a large amount of the people who would switch to Virgin Mobile are locked into these ridiculous 24 month contracts (16 months left on mine). This, in my opinion, is one of the major stumbling blocks and a serious problem that inhibits proper competition in South Africa. Big companies just want to lock you into contracts, with ridiculous penalty clauses for exiting early if you choose to go that route (most people I would guess just get other people to take over their contract).

Half the problem is that the actual cellphones are too expensive. It generally works out cheaper to buy a contract than to buy the cellphone up front and use prepaid. It might not be significantly cheaper, but when you throw in the “free�? minutes, you can’t argue that it’s not a better deal. When you think about it like this, it’s not really surprising that there’s so much cellphone theft.

Personally, I will be applying for a credit card from Virgin (if their site ever starts working for me) seeing as there don’t seem to be any lame charges to have one, whether it gets used or not. Their mobile offering is obviously a non-issue for me seeing as I’m locked into my existing contract with MTN. It’s a pity they haven’t launched into the market with some really competitive vehicle finance offering, as by the looks of things I’m going to get crucified by the climbing interest rates.