Internet service provider MWeb and Wireless Business Solutions (WBS) have struck a deal that will see MWeb offer iBurst`s wireless broadband service to its client base.
Announced yesterday afternoon, the agreement means MWeb, part of the Naspers Group, will resell iBurst along with its other offerings, which include Telkom`s ADSL and Vodacom`s 3G/HSDPA products.
WBS iBurst MD Alan Knott-Craig Jnr says the non-exclusive agreement sees MWeb added to iBurst`s 300-strong reseller list. Other companies reselling iBurst include Internet Solutions, Autopage and Nashua Mobile.
He says the advantage of offering iBurst is that it can be installed within 72 hours of ordering, while a minimum waiting period of about six weeks is needed for Telkom`s ADSL service.
"We certainly have had our issues, but we have invested heavily in our network by increasing it from 35 to 110 base stations this year and we have improved our back-office systems considerably as well," Knott-Craig says.
Earlier this year, WBS iBurst representatives said in Parliament the company had invested R200 million in upgrading its network, but Knott-Craig refused to confirm this. However, he says the company has sufficient financial resources to expand its network without seeking additional funding.
iBurst, the second wireless broadband product offering from MWeb, will be offered to both business and home customers.
MWeb Internet Service Provider CEO Rudi Jansen says the number of broadband options available often baffles small and medium businesses, as well as home users.
"All the broadband options have different benefits and are suited to different applications and usage patterns, so we will assess these before advising a customer on the best solution."
Jansen adds that more users need Internet access on the move, while small businesses often cannot afford to wait for ADSL to be installed.
Competitive market
An analyst who spoke on condition of anonymity says the local broadband market will become more competitive in the near future. As a result, companies such as MWeb and iBurst would seek strategies that allow them to leapfrog their competition and achieve a larger installed base.
This, he says, would result in improved offerings for the consumer. However, he cautions that profit margins on broadband offerings may not be as high as such companies expect. This, he says, is as a result of low service levels and high pricing locally.
Steven Edwards, an analyst at MarketWorks Advisory, says the move allows MWeb to begin offering services in underserviced areas, although the pricing may still be too expensive.
"However, I do see a reduction in broadband pricing that will have to happen if the market is going to prepare itself for the introduction of the Eassy [East African Submarine Cable System]," he says.
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