Telkom has finally confirmed that it has signed a roaming agreement with cellular operator MTN. TechCentral reported a month ago that the two parties would sign the deal.
In a statement released via the JSE on Wednesday afternoon, Telkom says it had concluded a five-year national roaming agreement with MTN.
MTN rival Vodacom had also been bidding for the Telkom business.
In terms of the agreement, Telkom and its customers will have national access to MTN’s 2G and 3G networks throughout the country. Telkom has not disclosed the value of the deal with MTN.
Telkom is in the process of building a mobile network of its own, following its decision to dispose of its stake in Vodacom, the country’s largest cellular network operator.
In Wednesday’s statement, Telkom says it has placed orders to build 2 000 new base stations in “selected high-density areas over the next two years”.
The company plans to spend about R6bn over the next five years extending its mobile network.
“The conclusion of a roaming agreement with MTN enhances Telkom’s ability to offer Telkom customers extensive and national mobile coverage from day one of launch and, accordingly, is key to the delivery of a successful mobile strategy.”
MTN’s winning the deal over Vodacom is somewhat ironic given that the latter had been joined at the hip with Telkom for more than 15 years. But it makes sense given that MTN has invested R12bn in its network in the past two years, especially in improving the capabilities of its 3G network, and has significant spare capacity on its network.
The deal is not the first such arrangement in SA. Cell C has a long-standing roaming agreement with Vodacom. Cell C’s network is not as extensive as Vodacom’s, especially in the more outlying areas. — Duncan McLeod, TechCentral