Telkom is punting its next-generation network (NGN) as it seeks to monetise the asset while increasingly rolling it out.
So far, the network has more than 475 000 active ports and has passed 400 000 homes along the route, says acting CFO Deon Fredericks. Telkom spent R6.5 billion during the year on infrastructure, the bulk of which went into the NGN.
This is a 12% increase on what it invested last year, and was at about the midpoint of its previous guidance. For the next two years, Telkom will spend between 14% and 17% on capital expenditure.
The company is keeping a lid on costs and will only spend on items that either add efficiencies, or generate income, says Fredericks. Of the money it spent in the year to March, R2.4 billion went into converting the access network to IP, while maintenance and enhancements to the existing networks cost R2.65 billion.
Its mobile arm only received investment of R1.4 billion as the company moved its focus to building infrastructure in major metropolitans. One of the telco's key focus areas is to increase broadband coverage.
CEO Sipho Maseko says the NGN rollout will be accelerated in the coming years, noting that data use grew a "phenomenal" 89% year-on-year. Telkom is also seeing its long-term evolution rollout gain momentum, with 1 183 sites converted, providing speeds of up to 80Mbps.
Telkom is also building what it says will be the "largest WiFi network in South Africa," with 2 426 spots already live. Maseko notes this is a critical area for Telkom to leverage.
The operator is also looking at piloting value-add products later this year and a variety of content. This comes as it also announced fibre-to-the-premises will be rolled out to 20 suburbs by year-end.
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