Telecommunications industry investor and former Dimension Data director Richard Came, who has played a leading role in building alternative fibre-optic infrastructure in South Africa in recent years, has bought a minority stake in last-mile fibre player Conduct Telecommunications.
Came, who also has a shareholding in metropolitan and long-haul fibre-optic telecoms company Dark Fibre Africa through a company called Community Investment Ventures, has bought 10% of Conduct, which issued new shares to facilitate the transaction. He has made the investment personally.
Another telecoms industry executive is poised to make a similar investment in Conduct, Came says, but isn’t able to name the person in question as the deal is still being finalised.
Conduct, which builds fibre-optic infrastructure in predefined precincts — Rivonia and Illovo in Johannesburg are two examples — is controlled by international project management firm The Birchman Group. The Industrial Development Corp is the main external provider of debt financing. Birchman also led the project management for Dark Fibre Africa’s infrastructure roll-out in its first three years.
Came says Conduct is careful in selecting precincts where there is likely to be demand for fibre access and that will therefore prove viable. “Illovo was an example of a perfect precinct: high density with multiple tenants. That’s worked out quite well.”
The focus is likely to remain on business customers for now, though Came says Conduct is considering fibre-to-the-home (FTTH) deployments as well. “We are keeping an eye on it, but the model is difficult. The wealthy in South Africa tend to live on big properties, so the business cases are still a bit tricky,” he says. “Within a year, though, we’ll see either ourselves or other people doing more aggressive FTTH deployments.”
In an interview with TechCentral in October 2012, Conduct CEO Johan Pretorius said the company planned to spend R500m over a 12- to 24-month period expanding high-speed communications networks to 100 precincts around South Africa.
Like Dark Fibre Africa, Conduct provides “unlit” fibre to Internet service providers rather than serving end users directly. It provides the fibre on an open-access basis. Service providers, in turn, supply connections to businesses of anywhere between 2Mbit/s and 1Gbit/s. — (c) 2013 NewsCentral Media