Competition on the fibre front is about to heat up as one of SA's largest telecoms companies, with fingers in both business and consumer market pies, plans to board the fibre bandwagon.
Vox Telecom has confirmed it is going to join the fibre movement that gained momentum last year, with plans to deploy fibre infrastructure services to its customers around the country. This adds to the company's current list of services, including alternative voice solutions, data access and Internet service provider services, cloud, PBX and video conferencing services, telephony management systems, faxing and text messaging applications.
The news comes just shy of two weeks after Vox Telecom CEO Jacques du Toit told ITWeb the company had decided to end talks around selling the company, which it had been engaged in for many months. He said at the time the board came to the conclusion it would be "crazy" to sell the company.
Operator opposition
The fibre move, which Africa Analysis analyst Dobek Pater says comes as somewhat of a surprise, will further ignite competition in the space.
Pater says Vox Telecom is likely to pose the biggest competition to the "big players" which are building their own infrastructure, notably SA's mobile operators and Neotel - which may soon be joining forces with top operator Vodacom.
All but one of SA's mobile operators have their own fibre projects on the go. Vodacom started planning an extensive fibre foray from as far back as 2013, at least, while MTNand Telkom announced plans and started making inroads on the fibre front last year.
Cell C, meanwhile, is lagging in the fixed connectivity race. The operator, SA's third largest with about 18 million subscribers, has yet to make public any fibre plans, beyond its stake in FibreCo.
Diversify and consolidate
Pater says, while Vox's fibre move will not cause major waves in the local telecoms landscape, competition will certainly become more heated than the market had anticipated.
He adds the market is also becoming fragmented, with service providers and infrastructure players joining the fibre movement. This means SA is likely to see market consolidation a few years down the line, as some operations become unsustainable, says Pater.
"Vumatel, for example, has already recognised the need for economies of scale and is moving into more communities. [Fibre players] have to build up scale, because prices will come down and larger operators will look to buy out smaller players."
That said, consolidation may be the strategy of choice - especially for some of the smaller players, Pater points out. "And it would not be a bad thing. Competition in the market would be maintained, there would just be less fragmentation in the market."
For Vox, the introduction of fibre to its portfolio of business services could be the difference between losing a client to another service provider as the shift to fibre becomes more important, and holding on to its established base by investing in the super-broadband technology, Pater notes.
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