Cell C is facing serious financial problems and has begun talks to delay debt payments and hired consultants to probe its business practices.
As part of its turnaround plan, Cell C has implemented significant austerity measures and has cut costs which do not contribute to revenue-generating activities.
One of the divisions which have been affected by the cost-cutting measures is Black, the company’s video streaming platform.
MyBroadband has learned that Cell C stopped its investment in the Black platform, which included freezing the development of its web and mobile apps.
There is a lot of speculation that Cell C may close Black, but the company said this service is here to stay.
“Cell C is not closing black. However, we will reduce future financial commitment,” Cell C spokesperson Karin Fourie told MyBroadband.
Fourie added that content is an important part of Cell C’s strategy and they use it to offer a differentiated service to their customers and as a retention tool.
Big financial challenges at Cell C
Cell C interim CEO Douglas Craigie Stevenson recently published an open letter detailing how the company will implement a new business plan to improve its current position.
Stevenson said the company faces financial and other challenges, and will implement a new business plan which will simplify its business model.
This plan includes a recapitalisation to optimise the capital structure, extracting greater value from its roaming agreement and optimising its network revenue and usage.
“The goal for Cell C is to become significantly better focused on operational performance, sound business ethics and accountability throughout the business,” said Stevenson.