{"id":102279,"date":"2014-05-21T10:02:19","date_gmt":"2014-05-21T08:02:19","guid":{"rendered":"http:\/\/mybroadband.co.za\/news\/?p=102279"},"modified":"2014-05-21T10:05:19","modified_gmt":"2014-05-21T08:05:19","slug":"cell-c-and-telkom-mobile-financially-doomed-analyst","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/cellular\/102279-cell-c-and-telkom-mobile-financially-doomed-analyst.html","title":{"rendered":"Cell C and Telkom Mobile financially doomed: analyst"},"content":{"rendered":"

Cell C<\/a> and Telkom Mobile<\/a> will never get a decent return on their investment. This is according to Wayne McCurrie<\/a>, portfolio manager at Momentum Wealth.<\/p>\n

Speaking on CNBC Africa, McCurrie said that there is no way that Telkom Mobile or Cell C are generating positive cash flows. \u201cThey must be burning up hundreds of millions, if not billions of rands,\u201d said McCurrie.<\/p>\n

He said that the \u201cglory growth days\u201d of the cellular market are over. \u201cThey hit full saturation many years ago, and the two smaller players come into the market and they want to grab 10% or 15% or 20% market share \u2013 I do not think it is viable from a shareholder perspective,\u201d he said.<\/p>\n

McCurrie said that Cell C and Telkom Mobile is in a difficult position as it is very challenging to take on Vodacom<\/a> and MTN<\/a> in a mature and saturated market.<\/p>\n

He said that the smaller players have no option other than to compete on price, because it is not possible to really offer something significantly different.<\/p>\n

However, lower prices mean lower returns, which will make it nearly impossible for the newcomers to show a good return on investment.<\/p>\n

Telkom<\/a> CEO Sipho Maseko<\/a> recently confirmed McCurrie’s view, saying that Telkom Mobile is not sustainable in its current format.<\/p>\n

\u201cOn the mobile side we experienced continued financial losses, and a standalone path is not sustainable going forward,\u201d Maseko told staff on 12 May 2014.<\/p>\n

Telkom is currently negotiating a network sharing agreement with MTN, which will limit Telkom\u2019s investment in its mobile network. Maseko hopes that this deal will make Telkom Mobile more sustainable.<\/p>\n

More on mobile services<\/h3>\n

MTN, Telkom Mobile network sharing deal here soon: report<\/strong><\/a><\/p>\n

MTN, Telkom Mobile deal to boost 4G data<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Well known analyst says that Cell C and Telkom Mobile shareholders will never get a decent return on their investment<\/p>\n","protected":false},"author":23,"featured_media":102225,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[14],"tags":[355,35,24396,42,279,689,24394],"class_list":["post-102279","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cellular","tag-cell-c","tag-headline","tag-momentum-wealth","tag-mtn","tag-sipho-maseko","tag-telkom-mobile","tag-wayne-mccurrie"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/102279"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/23"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=102279"}],"version-history":[{"count":2,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/102279\/revisions"}],"predecessor-version":[{"id":102531,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/102279\/revisions\/102531"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/102225"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=102279"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=102279"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=102279"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}