British Telecoms (BT) SA plans to make a more "aggressive" play for the local telecommunications market.
Speaking at a media briefing in Johannesburg yesterday, Brian Armstrong, BT's GM of Middle East and Africa, said the company would identify a black economic empowerment (BEE) partner, seek new contracts, outsource some of its operations to SA and create a social responsibility programme.
Previously, BT SA, which has been in the country for 15 years and has a staff complement of 75, focused on delivery of services.
Armstrong says the change in the South African regulatory environment, signified by the promulgation of the Electronic Communications Act, is one of the key issues driving the decision to seek growth.
"From the regulatory point of view, BT SA was limited in what it could do. Now the law offers more options."
As a result, the company plans to reinvigorate its search for a BEE partner, with an announcement expected towards the end of 2007, Armstrong says.
The plan to seek a BEE partner was approved by the group in principle two years ago, he says. It was, however, shelved due to the delays in the ICT charter. "There was too much uncertainty."
The BT Group has also identified SA as ideally placed geographically, where it can outsource some of its operations. It is unclear how large the outsourced operation in SA will be. However, Armstrong notes that in India about 10 000 jobs were created.
A pilot project will likely begin in SA in early 2008, he says. The company will provide further details in June.
Not a threat
BT SA yesterday underscored its growth plans by announcing it had, together with alliance partner Hewlett-Packard (HP), won a $450 million contract to provide Anglo American with managed communication services.
The seven-year deal, which will be applied in all the countries where Anglo American has operations, will see BT SA provide managed voice/data services, while HP takes care of the IT requirements.
Armstrong says the local telecoms operators should not see BT SA's move to seek new clients as a threat. The company targets global businesses, rather than local ones, he adds. As a result, it is not in direct competition with Telkom, for example.
BMI-TechKnowledge senior analyst Richard Hurst says BT SA's plans are a positive sign for the local telecoms market, as it indicates there is still huge potential in the local telecoms sector. The new player will serve to grow the market, he says.
"I don't think BT SA will be a real threat to the national operators and I would have to agree with their assertion that they are more likely to compete with the likes of Verizon and Orange Business," he says.
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