Telkom increases number of fibre-connected homes 35% to 414,847 and sees 18,9% rise in data traffic

Business Insider SA
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  • Telkom grew the number of homes connected with fibre by over 35% to 414,847 in the quarter to end-June.
  • Total fixed traffic increased 18,9% to 452 petabytes for the quarter.
  • Load shedding negatively impacted its costs with a significant increase of R44 million in diesel spend.
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Accessing high-speed fibre at home is increasingly becoming a way of life for many South Africans.

This can be seen in Telkom growing the number of homes connected with fibre by over 35% to 414,847 in the quarter to end-June, when measured year-on-year.

Aside from the big increase in the number of subscribers, total fixed traffic increased 18,9% to 452 petabytes.

News that Telkom is rapidly growing its number of fibre subscribers, comes as fibre is increasingly seen as the biggest growth driver for the telecom sector.

The increasing importance of fibre can be seen in the amount of corporate action it is driving in the sector, with Vodacom and the Remgro-controlled Community Investment Ventures Holdings (CIVH), announcing in November their plans to merge their fibre network operations.

This was followed a few months later by Telkom and MTN saying they were also in merger talks.

The rival groupings are looking at merging their respective fibre networks as a way to give themselves an edge in the market. CIVH, for example, owns fibre-to-the-home (FTTH) operator Vumatel, long-distance fibre group, Dark Fibre Africa (DFA), and has a holding in the Seacom undersea cable.

A merger with Vodacom, would give the new entity access to DFA's 13,200km fibre network, along with Vumatel's fibre network of 31,000km. For its part, Telkom has 165,900km of fibre.

Though the two groupings have rolled out a lot of fibre over the last few years, one of the key issues when it comes to householdings deciding whether to becoming subscribers is whether providers have already rolled out fibre past their homes.

Here, Telkom has also shown encouraging growth, with it increasing the number of homes its fibre passed by 45,3% to more than 890,000 from the same quarter a year ago.

Once people have access to fibre at home, there is a good chance they will subscribe to it, as Telkom says it has a connectivity rate of 46,6% for every home it passes.

Despite the rapid adoption of fibre in South Africa, Vodacom Group CEO, Shameel Joosub believes that there is still a lot of room for growth.

READ: After years of flirting, Telkom and MTN announcing they were in merger talks was almost inevitable | Businessinsider

In a conference call with analysts earlier this year, he noted that fibre only went past 2,2 million homes in SA, which still leaves 17 million homes without access to fibre.

Though Telkom is doing its bit to bring more fibre to South African homes, doing so in the past quarter was not easy, especially for Openserve, its fibre company, which had to cope with Eskom's inability to keep the lights on.

"While Openserve lays the building blocks for future growth, the ongoing economic pressures and the serious challenge of load shedding negatively impacted its costs with a significant increase of R44 million in diesel spend."

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