MTN-controlled Internet service provider Afrihost has begun moving its digital subscriber line (DSL) Internet clients onto a new network it believes will offering superior performance.
The new network aggregates upstream bandwidth from a number of providers and has been tweaked extensively to provide maximum throughput and stability, says Afrihost director Angus MacRobert.
Afrihost DSL customers will be cut over to the new network in the coming weeks.
News of the move comes two months after TechCentral reported that the service provider was in talks with alternative providers of wholesale data because parent MTN, which bought a controlling 50% stake in Afrihost in 2014 for R408m, was not prepared to continue providing wholesale data below cost.
“Let me be open about this. Afrihost has been a customer of MTN Business for a long time. We have given them wholesale prices that were subsidised by MTN. We cannot afford to do that going forward,” MTN South Africa CEO Mteto Nyati said in an interview with TechCentral in August.
With MTN’s blessing, Afrihost has tested services from alternative providers with some of its clients as it fights to stay competitive in a fiercely contested Internet service provider market.
“It’s important that that business … must deliver the profits we expect,” Nyati said. “When we assessed [Afrihost], we felt if they could get similar pricing from us from outside, it’s a good thing. We will still get the profits. We will not consider to [continue to] subsidise the prices they’ve been getting [until now],” said Nyati, who chairs Afrihost’s board of directors.
“That business needs to relook its positioning. We need to look at what it is Afrihost can offer. It cannot be about lowest price because that’s not sustainable. We need to look at repositioning it into a value space, offering value versus being the lowest priced,” he said.
In an e-mail to clients on Friday, Afrihost CEO Gian Visser said moving the service provider’s DSL network away from MTN would not have been possible without the telecommunications operator’s backing and buy-in.
“We’ve had a few key moments in Afrihost’s history. Moving to the MTN network in 2012 was one of them. It was a massive leap forward for us. It gave us greater insight into our DSL network and helped us be more in control of our clients’ Internet experience,” Visser said in the e-mail.
“There have been some bumps in the road (there always are in IT) but, all things considered, I think our team and MTN have done incredibly well. MTN were the perfect partner to guide us through that phase of our growth, and offer the support and resources to carry us to the next step of our growth.”
Visser admitted that Afrihost’s DSL network had “not been performing at the highest level” expected by the company’s clients. He said it has set about fixing this by custom-building the new network before launching any new products to the market.
The network has already been tested by “well over” 5 000 of its DSL clients. “We have tested every scenario we could think of,” said Visser. — © 2015 NewsCentral Media