Telkom’s fixed-line subscriber numbers have been on a steady downward trajectory for over two decades, and according to the feedback of voice-over-Internet protocol (VoIP) providers, the newer technology is replacing traditional calling.
The partially state-owned company’s fixed-line customers have dropped from a peak of almost 5.5 million in March 2000 to less than 800,000 in March 2023.
The decline was gradual initially, with subscriber numbers falling from the peak to around 2.7 million in March 2018.
However, from 2019 onwards, the decline accelerated, with Telkom losing an average of almost 300,000 subscribers yearly.
The telecoms company suffered the most significant fixed-line subscriber loss between March 2019 and March 2020, losing approximately 665,000 fixed-line customers.
The total decline between March 2019 and March 2023 was approximately 1.75 million subscribers or 295,000 per year.
The graph below shows how Telkom’s fixed-line subscribers declined yearly between March 1993 and March 2023.
There are several reasons why fixed-access lines in South Africa have seen such significant declines, including cable theft and vandalism, the uptake of mobile devices, and fibre replacing DSL as the preferred form of fixed home broadband connection.
Copper cables can fetch high prices through illegal trade, making them susceptible to theft, and Telkom has been actively replacing its copper infrastructure with fibre.
The theft of cables can result in extended periods of network downtime, frustrating consumers and businesses. In addition, maintaining and protecting these networks is expensive.
Increased adoption of mobile phones has also eliminated demand for residential landlines, and many businesses have moved away from traditional calling to voice over IP.
VoIP gives businesses a voice
Before the rapid adoption of VoIP technology, South African businesses relied on fixed access lines for communication channels to support their customers and make sales.
In the not-so-distant past, the newer technology had a reputation for poor call quality.
However, this is no longer the case. Advancements in network infrastructure and new technologies have helped it evolve to a point where it is overtaking traditional calling.
Nic Laschinger, chief technology officer at Euphoria Telecom, previously told MyBroadband that VoIP call quality has improved significantly over the past decade.
“Voice call quality on VoIP and mobile calls in South Africa has progressed to the point where digital calling has largely overtaken analogue channels in both the commercial and residential markets,” he said.
“We think nothing today of making a WhatsApp voice call, something that even a few years ago would have been buggy and frustrating, for example.”
Laschinger added that call quality over Wi-Fi networks is expected to improve further as 5G becomes more accessible in the country.
“More and better bandwidth has improved call quality even over Wi-Fi networks. This improvement will continue as 5G rollouts accelerate and fibre completely overtakes its older copper competitors,” he said.
Switch Telecom director Gregory Massel said the Covid-19 pandemic resulted in an exponential increase in demand for the company’s services.
He also argues that Telkom’s copper networks were effectively obsolete.
“For business use, subscribers have switched from aged and costly on-site switchboards to cloud telephony solutions,” Massel said.
“VoIP Providers have specialised in providing cloud telephony solutions for many years and have a significant competitive edge over Telkom in terms of service offering, customer care experience, and price.”