South Africa’s small and medium enterprises (SMEs) are reaping big rewards from the billions of rands invested by telecoms groups in laying new networks and upgrading existing infrastructure.<\/p>\n
The SME sector is important to the economy as it is the biggest employer. It is also the country’s fastest-growing sector, contributing more than 40 percent to South Africa’s gross domestic product.<\/p>\n
Telecoms companies such as MTN, Vodacom, Telkom and Neotel are pumping in an estimated R40 billion to lay new fibre networks and upgrade existing networks to increase bandwidth capacity, and to meet rising demand for high-speed services.<\/p>\n
Vodacom will set aside R2.5 billion for its fixed-line network project to provide data to the corporate market. MTN spent R1.2 billion last year to lay fibre cables between Rosebank and Sandton.<\/p>\n
Telkom has set aside R30 billion for its own infrastructure investments, which will see the firm moving from its old legacy network to the latest next generation network.<\/p>\n
Neotel is planning to spend R11 billion in the next decade, while Cell C is doubling the company’s capital expenditure to more than R2 billion.<\/p>\n
What is also fuelling these investments is the fact that the voice market, especially in the cellular sector, is reaching saturation, and many analysts in the industry are predicting growth in the data market.<\/p>\n
Bertie Grobler and his partners could not have chosen a better time to enter the telecoms space.<\/p>\n
Their company, Pretoria-based Regro, is one of the 150 SMEs sharing millions of rands being invested in the upgrading of telecoms networks.<\/p>\n
In less than three years Regro, which provides telecoms equipment, maintenance and support and installation, is one of the first beneficiaries of the investment by the new kid on the telecoms block, Neotel.
Regro declined to say how much the contracts were worth, and would only say the firm’s policy was "to keep a low profile and get the job done".<\/p>\n
Another benefactor is Dark Fibre Africa, which was formed by Community Investment Ventures and Venfin to build a carrier-neutral, dark fibre infrastructure for the transmission of metro and telecom traffic.<\/p>\n
Dark Fibre is doing work for Vodacom and Neotel through its sister company, Mukoni Veltex.<\/p>\n
Bennie Langenhoven, the director of Tellumat Telecoms, agreed that the massive infrastructure projects had created opportunities for small firms.<\/p>\n
Langenhoven said that it was unlikely that business would dry up for these small firms because there were also opportunities for upgrades, expansions and outsourcing.<\/p>\n
"The secondary effect will bring new opportunities … communications is always required, especially when you have a growing economy," said Langenhoven.<\/p>\n
Big firms have not been left out. Firms such as Cisco and Nokia Siemens Networks are deriving opportunities and they, in most instances, sub-contract to small players.<\/p>\n
JSE-listed technology companies Reunert and Jasco benefit mainly through their subsidiaries CBI Electric and M-TEC, respectively.<\/p>\n
Jasco recently bought 34 percent in M-Tec, which was recently awarded a supply contract by Neotel. It was awarded a R2.5 billion supply contract by Eskom.<\/p>\n
Reunert said that it had seen a high demand for fibre from firms such as MTN.<\/p>\n
Other internet providers such as Verizon Business and Internet Solutions are waiting to be licenced, so that they can deploy networks.<\/p>\n
This will see more money pumped into the sector.<\/p>\n