Telkom is in the process of gradually doing away with the 8ta brand, which it painstakingly created with the launch of the company's mobile arm in 2010.
The news comes at an unanticipated time, given the busyness and disarray currently characterising the local mobile landscape, says Arthur Goldstuck, MD of World Wide Worx.
The information came to light this afternoon, when local tech Web site Gadget published a letter from Telkom Mobile MD Attila Vitai to staff members. The letter was sent out this morning.
According to the letter, 8ta will gradually be evaporated from the market as an independent brand, but the mobile arm will continue to exist as a branded Telkom division, Telkom Mobile.
Strong brand
When approached for comment, Telkom immediately confirmed it had decided to "progressively change the 8ta brand to Telkom Mobile".
The company says the move will support the group-wide convergence strategy and drive greater alignment. "This rebranding exercise will support a more effective business with stronger commercial prospects."
Telkom's statement went on to detail its reasons for the departure from the pink and black brand SA has come to know as the country's fourth mobile operator: "The Telkom brand is well-established in SA. As the company continues to execute its strategy and to pursue the convergence agenda, it is beneficial to leverage off the strong Telkom brand equity and the company's unsurpassed network infrastructure, which includes the mobile network.
"Telkom's leadership is confident that the mobile operation has strong prospects for the future. We have launched the most competitive prepaid rate in the market. This sets the tone for further product announcements planned over the next weeks."
The company says a media briefing will be held to elaborate on the rebranding of 8ta at a date that will be revealed shortly.
Puzzling timing?
Goldstuck says that, while the dissolving of the 8ta trademark in favour of Telkom branding was something that was expected in the long run, it was not expected to be announced right now - and especially today, with the interconnect rate drop and all the noise the market is making around pricing and new products.
"I think the networks are in a bit of disarray at the moment, in terms of all aspects of the market."
Goldstuck notes that the name "Telkom Mobile" was always in line with the company's vision. "The name 'Telkom Mobile' was anticipated to be used even before the launch. '8ta' was always seen as a bit of an aberration.
"Telkom was a strong brand that could immediately be rolled out and the public trusted the infrastructure was in place - whereas 8ta was seen as a little start-up, which it certainly was not."
He says Telkom quickly discovered that having a younger audience - which the 8ta brand spoke to - was a recipe for an extremely low average revenue per user (ARPU). "This is evident in their results, which reveals they have the lowest ARPU in the market."
8ta, says Goldstuck, has four million customers at the end of the day - which is a strong base to market on. "But, because it was an independent brand, they couldn't market it as Telkom."
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