Cell C is seeking new deals in ‘fibre space’

MOBILE network Cell C is on the prowl for acquisitions in the fledging fibre-to-the-home (FTTH) sector as it ramps up its transformation into a full-service telecoms group.

“We are in negotiations to acquire a few exciting opportunities in the fibre space,” Cell C chief executive Jose Dos Santos said yesterday.

“The company’s new C-Fibre connections increased from 3 733 to 16 425. The offering was launched in 2016 with open-access Fibre Network Operators and has continued to grow by launching four new open-access networks earlier this year.”

The company said it would pursue organic and acquisitive growth to shore up its fibre business in the next few years.

The Department of Telecommunications in June said 280 000 homes were connected to fibre in South Africa as of March 2018. This was more than 191 000 more homes since 2017. Telkom has previously said the company had connected 109 336 homes with Openserve fibre.

Ofentse Dazela, a director of pricing research at Africa Analysis, said fibre was an important growth area for the industry.

“Currently, all big four mobile network operators have invested in the FTTH market and are participating as both infrastructure and service providers. This will help them to offset the impact of the declining voice revenues, a strategy intended to open new revenue streams,” Dazela said.

Cell C also saw a marked uptake in its much-punted entertainment platform, Black, which it launched last year. The firm said its customers made up 70 percent of subscribers on Black with 30 percent of subscribers belonging to other networks.

The service has 260 000 on free trial, while 2.5 million people have browsed the service to date, generating R3.1 million in revenue.

Smaller loss

The company reported a net loss of R645m in the six months ended June, an improvement of 33 percent compared with a loss of R968m in the prior year.

The group’s service revenue increased 11 percent from R6.2 billion to R6.9bn, while earnings before interest, taxes, depreciation and amortisation increased 16 percent to R2.4bn.

The group said its total active subscriber base increased by 600 000 customers to 16.3 million in the six months.

However, the group saw its total active data subscribers decline from 12.6 million in the comparative period to 12.1 million in the six months under review.

The group’s data revenue, however, increased from R2.4bn to R2.9bn, comprising 52 percent of the group’s total revenue in the period.

A Deloitte mobile consumer survey released yesterday found that when it came to customer retention, value for money for access to data and the internet, trumps everything across all age groups, geographic areas and genders.

The report further found that South African mobile subscribers are looking for cheaper data prices – to the extent that large-scale consumer activist movements have been formed.