Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      World Bank set to back South Africa’s big energy grid roll-out

      20 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Sita hits back at critics, promises faster, automated procurement

      20 June 2025

      The transatlantic race to create the first television

      20 June 2025

      Listed: All the MVNOs in South Africa – 2025 edition

      19 June 2025
    • World

      Watch | Starship rocket explodes in setback to Musk’s Mars mission

      19 June 2025

      Trump Mobile dials into politics, profit and patriarchy

      17 June 2025

      Samsung plots health data hub to link users and doctors in real time

      17 June 2025

      Beijing’s chip champions blacklisted by Taiwan

      16 June 2025

      China is behind in AI chips – but for how much longer?

      13 June 2025
    • In-depth

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025

      Digital fortress: We go inside JB5, Teraco’s giant new AI-ready data centre

      30 May 2025

      Sam Altman and Jony Ive’s big bet to out-Apple Apple

      22 May 2025
    • TCS

      TCS+ | AfriGIS’s Helen Hulett on how tech can help resolve South Africa’s water crisis

      18 June 2025

      TechCentral Nexus S0E2: South Africa’s digital battlefield

      16 June 2025

      TechCentral Nexus S0E1: Starlink, BEE and a new leader at Vodacom

      8 June 2025

      TCS+ | The future of mobile money, with MTN’s Kagiso Mothibi

      6 June 2025

      TCS+ | AI is more than hype: Workday execs unpack real human impact

      4 June 2025
    • Opinion

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025

      Beyond the box: why IT distribution depends on real partnerships

      2 June 2025

      South Africa’s next crisis? Being offline in an AI-driven world

      2 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » In-depth » Neotel grows consumer base, but still lags

    Neotel grows consumer base, but still lags

    By Editor22 March 2012
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp
    Sunil Joshi

    Neotel has doubled the number of retail subscribers on its network in the past 11 months, growing this customer segment from 50 000 to 100 000, according to CEO Sunil Joshi.

    However, the company, licensed in the mid-2000s as the first competitor to incumbent Telkom, is still struggling to make much on an impact in the consumer market, with less than 10% of its revenues coming from this base.

    Neotel has spent the past five years pouring billions of rand into network infrastructure. Though it’s had success building a strong corporate customer base, it is continuing to struggle to make headway in consumer voice and data services — much to the dismay of South Africans who had hoped it would give Telkom a genuine run for its money.

    The company has nearly 7 000km of fibre-optic cables in the ground in SA but access to this high-speed infrastructure is restricted to business customers. Joshi says Neotel now offers fibre access in 14 central business districts in the country but it’s unlikely retail consumer access will be provided any time soon. “It’s a commercial and viability decision case,” he says. “It’s still a while away.”

    Joshi says the doubling in the number of retail subscribers is the result of better product and device offerings.

    However, with Neotel’s consumer business accounting for only 10% of its revenue, it’s little wonder it’s chosen to focus most of its efforts on the business market. It’s grown its corporate customer base by 84% in the past year.

    “We wanted to grow market share in the last financial year,” says Joshi. “The SA market as a whole grew by 4% during the period; Neotel grew by 24%. Clearly we’re doing something right”.

    Joshi says one of Neotel’s goals for the current financial year, which ends on 31 March, is to report a profit at the Ebidta level. Ebitda is financial jargon for earnings before interest, tax, depreciation and amortisation. It achieved this in the first fiscal quarter of the financial year, and for the first time since launch. Joshi says the company will finish the year the same way.

    He says this suggests Neotel’s strategy is working. “We have 6 900km of fibre in the ground and we’re the only operator with connectivity to all four submarine cables and the fifth one [the West African Cable System, or Wacs] that’s coming later this year.”

    According to Joshi, this makes Neotel the only service provider with that level of access and with the “ability to provide ubiquitous connectivity to the east and west of Africa”.

    He says part of Neotel’s strategy is to move up Africa’s coasts as cables land, adding that the Southern African Development Community region is important for Neotel. However, when it comes to expansion, the route Neotel will take will be through partnerships with existing infrastructure providers. “We don’t want to build from scratch again like we did in SA.”

    By way of example, he points to Telecom Namibia — a minority shareholder in Neotel — which could provide network solutions for Neotel as it expands into that country’s telecoms market.

    “Where you have fibre, partnerships work. Where you don’t have fibre, we’ll supply voice and data services via satellite,” Joshi says of the challenges of partnerships in markets with limited fixed infrastructure. “We’re already serving some SA businesses with remote offices this way.”

    Joshi says Neotel focuses on Southern Africa while its parent, India’s Tata Communications, serves markets further north.

    Neotel says a large number of SA companies are expanding north into Africa and this presents an opportunity for the company to expand into new regions with existing customers.  — Craig Wilson, TechCentral

    • Subscribe to our free daily newsletter
    • Follow us on Twitter or on Google+ or on Facebook
    • Visit our sister website, SportsCentral (still in beta)


    Neotel Sunil Joshi Tata Communications Telkom
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleAfrica coming into focus for Neotel parent
    Next Article Samsung to offer free satellite TV to Africa

    Related Posts

    Listed: All the MVNOs in South Africa – 2025 edition

    19 June 2025

    MTN CEO edges Vodacom rival in pay stakes – but just barely

    18 June 2025

    TechCentral Nexus S0E2: South Africa’s digital battlefield

    16 June 2025
    Company News

    Making IT happen: how Trade Link gears up to enable SA retail strategies

    20 June 2025

    Why parents choose CambriLearn for online education

    19 June 2025

    Disrupt first, ask questions later – the uncomfortable truth about incident response

    18 June 2025
    Opinion

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    AI and the future of ICT distribution

    16 June 2025

    Singapore soared – why can’t we? Lessons South Africa refuses to learn

    13 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.