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

      Court battle brewing over contentious Joburg CCTV by-law

      7 July 2025

      Biometrics boss slams home affairs over R10 ID query fee

      7 July 2025

      TCS | Connecting Saffas – Renier Lombard on The Lekker Network

      7 July 2025

      Rain’s new Loop lets you carry your Wi-Fi and music everywhere

      7 July 2025

      Medupi unit 4 rejoins grid, easing winter load shedding fears

      7 July 2025
    • World

      Cupertino vs Brussels: Apple challenges Big Tech crackdown

      7 July 2025

      Grammarly acquires e-mail start-up Superhuman

      1 July 2025

      Apple considers ditching its own AI in Siri overhaul

      1 July 2025

      Jony Ive’s first AI gadget could be … a pen

      30 June 2025

      Bumper orders for Xiaomi’s YU7 SUV heighten threat to Tesla

      27 June 2025
    • In-depth

      Siemens is battling Big Tech for AI supremacy in factories

      24 June 2025

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

      20 June 2025

      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
    • TCS

      TechCentral Nexus S0E4: Takealot’s big Post Office jobs plan

      4 July 2025

      TCS | Tech, townships and tenacity: Spar’s plan to win with Spar2U

      3 July 2025

      TCS+ | First Distribution on the latest and greatest cloud technologies

      27 June 2025

      TCS+ | First Distribution on data governance in hybrid cloud environments

      27 June 2025

      TCS+ | First Distribution on cloud cost management in Microsoft Azure

      26 June 2025
    • Opinion

      In defence of equity alternatives for BEE

      30 June 2025

      E-commerce in ICT distribution: enabler or disruptor?

      30 June 2025

      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
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • 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 » News » Telkom should fear Vodacom: analyst

    Telkom should fear Vodacom: analyst

    By Agency Staff1 July 2015
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp
    Steven Ambrose
    Steven Ambrose

    Regulators’ approval of Vodacom’s R7bn bid to buy fixed-line business Neotel should worry Telkom, said an analyst.

    On Tuesday, the Competition Commission gave Vodacom the green light to buy Neotel for R7bn.

    The regulator made the decision a year after Vodacom signalled its intention to buy Neotel. The Competition Commission’s decision also comes after the Independent Communications Authority of South Africa approved the merger last month.

    The deal is expected to boost Vodacom’s spectrum capabilities and help it enter the fixed-line market, meaning it could compete with Telkom head-on.

    Strategy Worx CEO Steven Ambrose said Telkom should be worried about the development.

    “The second [fixed-line] operator as originally envisaged is now Vodacom across all levels — wholesale, retail,” Ambrose said. “And they’re formidable.”

    Ambrose said that while Telkom still has the country’s biggest fibre network, Vodacom is set to upscale as a result of snapping up Neotel.

    “Strategically, Vodacom now has significantly improved its infrastructure,” said Ambrose.

    At Telkom’s annual results briefing in Johannesburg last month, the company’s CEO, Sipho Maseko, spoke on Vodacom’s bid for Neotel.

    “It will make [Vodacom] a formidable competitor,” Maseko said.

    “But as I said, you can … [get tears] in your eyes and be morose and miserable about it, but actually that is the nature of the market.

    “There is going to be competition. The bigger question is how do we begin to respond as a company to those sort of competitive changes in the marketplace, so that we retain our relevance and set ourselves on a path to glory,” Maseko said.

    One way Telkom has responded is by its R2,7bn bid to buy local IT services company Business Connexion. The Competition Commission also approved this bid earlier this year.

    The deal is expected to beef up Telkom’s business in the enterprise space in South Africa and even in other African countries.

    While the Competition Commission’s approval of the deal is a key milestone for Vodacom in its bid to buy Neotel, certain hurdles remain.

    Final word on the deal still needs to come from the Competition Tribunal and conditions placed on the deal could frustrate Vodacom’s spectrum ambitions.

    The Competition Commission stipulated that the tie-up can only happen if Vodacom does not use Neotel’s spectrum for two years.

    Other conditions include that the company should commit to a R10bn investment in fixed network, data and connectivity infrastructure in South Africa. Meanwhile, a third condition is that share capital in Vodacom held by black economic empowerment shareholders must increase by an amount of R1,4bn.

    Challenges to the deal could also come from the likes of Cell C, which has previously said it could launch legal action to prevent the Vodacom-Neotel deal from going ahead.

    On Wednesday, Cell C said that it is “reviewing the announcement by the Competition Commission regarding the Vodacom, Neotel transaction and will comment at a later stage”.

    However, Ambrose is expecting a challenge from Cell C.

    “Cell C are definitely going to try and put a spanner in the works. They said there’s going to be a legal challenge and I have no doubt they’re going to try,” said Ambrose.

    “But I don’t see what leg they’ve got to stand on because now their major bone of contention, unfair competition on the radio side, has been sort of delayed with a two-year stipulation from the Competition Commission that Vodacom cannot use any of the spectrum.

    “So, that sort of kills any major Cell C concern for the short term,” said Ambrose.

    Meanwhile, Vodacom said in an e-mailed statement that it is focusing on the next step regarding the Neotel deal.

    “We welcome the Competition Commission’s recommendation to the Competition Tribunal for the conditional approval of the Neotel transaction,” said Vodacom spokesperson Richard Boorman.

    “The tribunal is now expected to set the matter down for hearing. We look forward to working with the applicable regulatory bodies to achieve a speedy outcome, which will ultimately result in increased investment in communications infrastructure and the accelerated rollout of broadband connectivity in South Africa,” he said.  — Fin24



    Competition Commission Neotel Steven Ambrose Telkom Vodacom
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleVodacom cleared to buy Neotel
    Next Article Gov’t sells 14% Vodacom stake to PIC

    Related Posts

    Sasol, Vodacom team up to modernise Secunda operations

    4 July 2025

    Vodacom’s influence on Maziv too strong to ignore: tribunal

    27 June 2025

    LEO satellite industry is on the horns of a dilemma

    25 June 2025
    Company News

    Huawei launches next-gen fibre-to-the-room solution

    7 July 2025

    Remote monitoring tools: IT lifesavers or hacker gateways?

    7 July 2025

    The school placement crisis is getting worse

    7 July 2025
    Opinion

    In defence of equity alternatives for BEE

    30 June 2025

    E-commerce in ICT distribution: enabler or disruptor?

    30 June 2025

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

    17 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.