South Africa - Fixed-line Market and Fibre Infrastructure - Insights and Statistics

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South Africa - Fixed-line Market and Fibre Infrastructure - Insights and Statistics

South Africa's second national operator Neotel has been gaining market share in competition with fixed-line incumbent, Telkom SA. It is now in the process of being acquired by Vodacom, the country's leading mobile network operator. Neotel is using wireless technologies such as CDMA-2000, WiMAX and LTE to provide alternatives to Telkom's copper access network. Having bought and leased national fibre infrastructure from parastatals Transtel and Eskom and building its own fibre backbone network in parallel, Neotel is also operating as a provider of wholesale national and international connectivity to the business sector.

While Neotels financial performance has been improving, Telkom has been struggling since it divested its share in Vodacom and started its own mobile business which it is now looking to sell. The company has also made losses with international investments and legal disputes and has been fined for anticompetitive behaviour.

To create more competition, the government has created Broadband InfraCo, a national infrastructure company to provide cheap backbone network capacity to service providers. The major mobile network operators, Vodacom and MTN, have also moved into the fixed-line and national fibre sector under a converged, service-neutral licensing regime. In addition, many municipalities in South Africa, including the country's largest cities, are implementing their own metropolitan fibre and wireless broadband networks. Several Fibre-to-the-Premises (FttP) deployments are underway.

All of the major players are involved in the various international submarine fibre optic cables that have reached the country in the past few years. This has brought down the cost of international bandwidth dramatically. Previously, Telkom had been monopolising access to the only major cable serving the country. Several additional terabit cables are scheduled to go live in 2014, connecting Africa directly to the Americas.

Key developments:

Telkom launches Single Number service, writes off legacy assets, invests billions into broadband infrastructure; Neotel takeover by Vodacom; many new national and metropolitan fibre network rollouts, including FttP; new international fibre optic submarine cables planned into 2015; theft of copper endangering telecom infrastructure; Vodacom contracts Alcatel-Lucent to build GPON network.

Companies covered in this report:

Telkom SA, Neotel (Tata), Vodacom, MTN, Broadband InfraCo, Transtel, Eskom, SITA, Sentech, Seacom, Dark Fibre Africa (DFA), Internet Solutions, FibreCo, eFive, WASACE.

1. Synopsis
2. Market overview
2.1 Fixed-line statistics
3. Fixed network operators in South Africa
3.1 Telkom
3.1.1 Shareholder structure
3.1.2 Business segments and services
3.1.3 Financial results
3.1.4 Network infrastructure
3.1.5 Wireless Local Loop (WLL)
3.1.6 Telephone tariffs
3.1.7 Prepaid fixed-lines
3.1.8 Data services and leased lines
3.1.9 Global network services
3.1.10 ISDN
3.1.11 PBX
3.1.12 VSAT
3.1.13 International expansion
3.1.14 Structural separation
3.2 Neotel
3.2.1 Licence conditions
3.2.2 Shareholder structure and funding
3.2.3 Financial performance
3.2.4 Network infrastructure
3.2.5 Services and market potential
4. National fibre infrastructure
4.1 Telkom and Neotel
4.2 Broadband InfraCo
4.3 Dark Fibre Africa
4.4 Mobile operators
4.4.1 Vodacom
4.4.2 MTN
4.5 FibreCo
4.6 Fibre-to-the-Premises (FttP)
5. National private networks
5.1 Overview
5.2 Transtel
5.3 Eskom
5.4 Other electricity utilities
5.5 State IT Agency (SITA)
6. Sentech
7. Municipal networks
7.1 Knysna Africa's first municipal network
7.2 City of Tshwane
7.3 City of Johannesburg
7.4 Ekurhuleni (East Rand)
7.5 City of Cape Town
7.6 eThekwini (Durban)
7.7 Gauteng Link
8. International infrastructure
8.1 Submarine fibre
8.1.2 Seacom
8.1.3 EASSy
8.1.4 WACS
8.1.5 African Coast to Europe (ACE)
8.1.6 SAEx, WASACE
8.2 South African Power Pool
8.3 Satellite
9. Related reports
Table 1 Historic - Fixed lines in service by operator and teledensity in South Africa 1999 - 2004
Table 2 Fixed lines in service by operator and teledensity in South Africa 2005 - 2014
Table 3 Telkom SA major shareholders Mar 2014
Table 4 Telkom financial results 2013 - 2015
Table 5 Telkom SA prepaid fixed lines 2002 - 2014
Table 6 Telkom SA's fixed line data revenue and annual change 2002 - 2015
Table 7 Telkom SA postpaid ISDN channels 2000 - 2013
Chart 1 Fixed lines in service and teledensity in South Africa 2005 - 2014

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