Voice over IP firm Clear Voice and independent converged voice and data solutions entity iConnect have merged, with effect from the beginning of this month.
Cape- and Pretoria-based Clear Voice will have access to iConnect's core network infrastructure. iConnect, based in Sandton, Johannesburg, will be able to expand geographically without additional investment.
Clear Voice MD Felicity Menge says the merger allows both firms to acquire business aspects that were missing from their portfolios that would otherwise have to be created from scratch. She explains the merged entity can offer an entire range of services, from cloud-hosted offerings to voice and call logging.
Clear Voice would have needed to invest in its backend, and iConnect was keen to expand to Cape Town, says Menge. The merger avoids the need for greenfields investments in these areas, she explains.
Revenue boost
The companies are busy training resellers on the new product lines and Menge expects the combined company to sell 20 million minutes a month by February, from the current 14 million minutes.
“The agreement will enable the unified company to achieve critical mass that may not otherwise have been attained through organic growth as separate entities,” say Menge, and founder and CEO of iConnect Calvin Collett in a joint statement.
Menge expects “a lot” of consolidation in the voice over IP sector as the traditional least-cost routing (LCR) market continues to lose steam. The LCR market has been under pressure since mobile termination rates started declining, which has affected margins.
As a result, many large players such as Vox Telecom and Altech Autopage are shifting traffic onto their own networks to boost margins.
The joint statement notes that the merger will result in economies of scale that will allow the firms to pass on savings.
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