Telkom bleeds fixed-line users, but eyes acquisition

Telkom’s recently released results show that fixed-line broadband subscribers – which include ADSL, VDSL, and fibre-to-the-home customers – declined from 974 181 in September 2018 to 781 255 in September 2019.

This means Telkom lost 192 926 fixed broadband subscribers over the last year, which equates to a 19.8% decline in its customer base.

However, the struggling telco has offered to buy Cell C and combine South Africa’s two smallest mobile network operators to better compete against larger rivals.

The bid includes a plan to reduce Cell C’s debt and renegotiate contracts with suppliers, the people said, asking not to be identified because negotiations are ongoing. Telkom wants to take over the management of Cell C’s business.

The approach comes as Cell C explores options with MTN and local investors known as the Buffett Consortium to recapitalise the company, which may include the sale of some of its assets. The two offers will be considered side-by-side as Cell C and its owners try to restructure R9-billion of debt.

This comes after Telkom recently announced that it will become the first national telecommunications operator in South Africa to switch off its legacy 2G network.

The company will terminate 2G services in March 2020, according to CEO Sipho Maseko.

The company has about 250 000 2G-only users left on its network, out of a total subscriber base of 11..5-million, as most have migrated from 2G to 3G.

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My Office News Ⓒ 2017 - Designed by A Collective


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