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MTN plans more network spend

Paula Gilbert
By Paula Gilbert, ITWeb telecoms editor.
Johannesburg, 23 Jun 2017
MTN spent over R20 billion in capex in SA during 2015/2016 and plans to spend R11.5 billion locally this year.
MTN spent over R20 billion in capex in SA during 2015/2016 and plans to spend R11.5 billion locally this year.

Improving its data network in SA is a key priority for MTN, as the telco continues to invest heavily in infrastructure to win more customers.

"No other telco has spent anywhere near what MTN has invested in its network over the last few years and also this year we will be outspending the nearest rival by a few billion rands," according to Krishna Chetty, GM for network deployment at MTN.

The mobile operator spent over R20 billion in capex in SA only during 2015 and 2016, and plans to spend R11.5 billion locally this year.

In comparison, Vodacom spent almost R8.5 billion in capex in SA in the financial year ended 31 March 2017, and another R8.7 billion the previous year. Telkom's capex spend was close to R8.7 billion for the year ended 31 March 2017 and over R6 billion the previous year.

In March, Cell C revealed its capex spend in 2016 was R3.4 billion and that it had spent R11.6 billion in total capex over the past four financial years.

MTN's capital expenditure push comes as part of anextensive investment strategy that kicked off in 2015.

"The investment focused on improving mobile coverage, specifically 3G and LTE, and also ensuring we capacitate our network and build a network capacity layer that will efficiently manage network traffic whilst ensuring excellent customer experience," Chetty told ITWeb.

"The recent investment has resulted in us being ranked number one in three of the top cities in the country ? namely Cape Town, Durban and Pretoria ? and this will grow as we continue to execute on our strategy."

Chetty says the investment strategy will continue for the next few years, towards the lead into 5G.

Data demand

Chetty believes MTN has "a great voice network already" but high bandwidth requirements of customers - linked to rich data services - means it's essential for operators to invest in higher order technologies such as 3G and LTE to deal with customer demand.

This as data consumption continues to increase due to the rapid uptake of smart devices.

"Taking a more in-depth look at demand, we see more and more people are getting hooked into the data world, and those who are already data consumers are increasing their consumption.

"The increasing interconnectedness between people, devices and machines in the Internet of things (IOT) ecosystem will fuel the growth of data and will further demand high-performing networks," he says.

Spectrum starvation

Spectrum limitations, however, remain an issue, according to Chetty, who says the allocation of high-demand spectrum (in the 700MHz, 800MHz and 2 600MHz bands) would allow operators to roll out high-capacity services and also extend LTE coverage to rural areas sooner.

"Some of the work done to mitigate against this is re-farming allocated spectrum to be used for 3G and LTE. There are limitations associated with this so we are not able to deliver the networks we could with incremental spectrum."

Spectrum allocation has been held up by last year's publishing of the National Integrated ICT Policy White Paper which advocates to shake-up the previous policy frameworks for spectrum allocation in favour of the deployment of a wireless open access network.

Chetty says MTN plans to strengthen its mobile network by getting 3G coverage to mirror that of 2G in rural areas - but spectrum allocation is a key enabler to this.

"The important thing here is to ensure the device ecosystem matches the technology rollout so partnering with OEMs and chipset manufactures to get cheaper 3G and LTE devices will also be part and parcel of our plans going forward," he concludes.

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