Johannesburg, 08 Mar 2007
SA's largest fixed-line operator says over a third of its network will be next-generation network-based by 2011.
However, the company would not commit to a final deadline for full rollout of its next-generation network (NGN), saying a lack of IT in SA's rural areas and its current position as a monopoly acted against a big-bang approach.
Last year Telkom invested almost R5 billion as it increased capital spend and moved towards an NGN. The company plans to spend another R25 billion in the next four years, reaching a total of R30 billion in its customer centricity drive.
An analyst, who asked not to be named, points out only 40% of iTelkom's 2007 spend will be on NGN. The rest, he says, will be spent on IP systems, legacy systems and the last mile upgrade, among other aspects. Telkom's fixed-line spend for 2007 is expected to reach R5.9 billion.
CTO Thami Msimang, addressing an analysts' briefing this morning, says the company cannot take a completely IT approach as there are no guarantees that all of SA's telecommunication users will have access to personal computers. He adds part of the old network that will be removed and replaced will be recycled in rural areas to expand telephony in those remote areas.
Telkom is currently the only fixed-line provider, as Neotel had yet to make an entrance, Msimang notes. As such, Telkom could not take a big bang approach, where there would be a definite cut-off date for migration to the NGN, as customers need to know there is security of service in case something goes wrong, he says.
Business drivers
Managing executive of network infrastructure provisioning Pierre Marais says the company currently has 11 networks, which will be collapsed into a single network. Some 35% of Telkom's network will be NGN-based by 2011, he says.
Marais says the speed of migration depends on business drivers, such as the cost of rollout and demand for NGN-based services. Five percent of the network will be NGN-based this year. Next year, this will increase to 10% and by 2010, 25% of the network will be NGN-based.
Telkom is also facing increased demand for broadband services, which Marais says is not likely to slow in the near future. As a result, the company has prioritised up-scaling the availability of ADSL services and the introduction of NGN leased lines to the corporate market.
In addition, it is increasing fibre to the node. In the 2006/7 financial year, Telkom says it speeded up its fibre rollout and initiated the deployment of metro Ethernet and accelerated its DSL rollout. It has also finalised developing its VOIP portfolio.
Telkom has also tested fixed WiMax and is on the cusp of rolling out a product offering, says Marais. This year, the company also intends to select an operational systems support integration partner and develop its triple-play portfolio.
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