Telkom’s broadband plans

Telkom recently released its annual results for the year ending March 2009, and these results included the company’s latest broadband and ADSL figures.

Over the last twelve months the number of ADSL subscribers increased by 33% – from 412,190 in 2008 to 548,015 in March 2009.  The number of Do Broadband subscribers increased by 58.1% to 188,540 over the last year while TelkomInternet’s all access account subscribers increased 18.2% to 423,196.

Telkom’s 548 015 ADSL users are fewer than Vodacom’s 720 000 3G/HSDPA data subscribers.  Vodacom has claimed the crown as the country’s largest broadband provider, something which Telkom may not be happy about.

“In line with our strategic intention to lead the market in affordable access to broadband, we consolidated our position as South Africa’s largest broadband provider and by year end had over 720,000 broadband customers,” Vodacom CEO Pieter Uys said.

Telkom CEO Reuben September is also after the title of broadband champion in South Africa, and recently said that he would like the group to be known as the leading provider of broadband services.  Telkom may however find the going tough in an increasingly competitive broadband market.

ADSL installation and growth plans

The fixed line provider said that it installed 91% of ADSL lines within 21 working days where no network build is required, compared to 79% in the year ending March 31, 2008.  Telkom further said that 74% of ADSL lines were installed within 21 working days where network build is required compared to 66% in the year ending March 31, 2008.

“The ADSL Self Install option is expected to continue to improve the installation times. As of March 31, 2009, 57% of all ADSL installations were being done through the Self Install option,” Telkom said.

Telkom announced that it has increased DSLAMs throughout the country by 50.4% to 4,000 sites.  The company further highlighted that their current broadband line penetration rate is 15%, and that their targeted penetration rate is 25% by 2013/14.

The broadband line penetration rate is however influenced by the number of fixed lines, a figure that has been steadily declining over the last few years.  The current number of fixed lines, 4,451,000, is significantly lower than the 4,726,000 operational fixed lines in 2005.  The declining number of fixed lines may give a slightly skewed view of the broadband line penetration rate growth in South Africa.

W-CDMA Mobile Data

Telkom launched its 7.2 Mbps HSDPA data offering towards the end of 2008, and despite lower prices than competitors Vodacom and MTN, the company only managed to sign up 5,253 by March 2009. 

The poor uptake of Telkom’s mobile broadband offerings may be related to its limited coverage – something which the company says it is actively addressing – and the relatively difficult signup process compared to that of Vodacom and MTN.

Telkom has rolled out 141 W-CDMA sites in major metropolitan areas throughout South Africa. Their initial focus has been on theft, breakages and incident-prone areas, customers waiting for services and Greenfield areas where Telkom has no copper infrastructure.

“In essence, the W-CDMA technology allows Telkom to deploy fixed-line lookalike services with regional fixed numbering plans instead of deploying copper, especially in high copper theft areas or areas where copper deployment is not feasible or too slow to roll out,” Telkom said.

“Our move into offering a fully fledged mobile service is dependent on the finalisation of market research and the outcome of pilot and customer trials planned for the end of 2009.”

Telkom’s broadband plans – give your views