Thursday saw the long-awaited launch of South Africa’s second national operator (SNO) — to be known as Neotel — at a function in Kyalami, north of Johannesburg, that featured violinists, African dance and a mime artist.
During the stage show, a digital animated presentation was screened with the message that “the rain becomes the river, the river becomes the sea, we become each other”, referring to the “gift of communication” that Neotel will bring.
In theory, the introduction of the second operator is set to help reduce high telecommunications costs in South Africa by offering competition to Telkom, which until now was the sole fixed-line network operator.
Videsh Sanchar Nigam, which owns 26% of SNO Telecom and which has been involved in the telecommunications business in India for 100 years, appointed Ajay Pandey as Neotel MD.
Pandey has more than 20 years’ experience in the telecommunications industry, having held the posts of president of India’s Tata Teleservices and CEO of Tata Internet Services. Videsh Sanchar Nigam is controlled by Indian industrial giant Tata.
Speaking at the press conference, attended by top telecommunication and IT businessmen and the media, Pandey outlined the company’s planned roll-out of telecommunication services based on leading-edge technologies and reiterated the company’s promise to introduce initial services for consumers by March 2007.
He said Neotel has secured access to the relevant Eskom and Transnet infrastructure, including almost 10 000km of optical-fibre backbone within metros and across the country, and will offer a variety of fixed and wireless services.
“We anticipate a cumulative capital expenditure of more than R11-billion in the first 10 years of our operation,” he said.
He also said Neotel hopes to capture about 15% of the local market in the next three to four years.
About Neotel’s new identity, Pandey said: “In its very form, our new identity demonstrates our commitment to change your experience of telecommunications, to respond to your needs with efficient simplicity, and to become your preferred telecommunications partner.”
Pandey said Neotel expects to have its first residential customers connected by the end of March 2007. Its voice and data (including high-speed internet and broadband access) services will start in the major metropolitan areas but will gradually expand across the country to reach up to 80% of the country’s population.
Minister of Communications Ivy Matsepe-Casaburri welcomed the new national operator, saying it has been a long journey and that the project has left her greyer than she thought she could ever be.
She said that Neotel will respond to challenges such as globalisation and the development gap in South Africa, and that it could also sustain development and provide competition.
The minister also launched Neotel’s new website, Neotel.co.za, at the conference.
Although Telkom’s five-year exclusivity period ended in May 2002, various delays were encountered, including a protracted search for a foreign investor, which delayed the launch of the SNO until now.
SNO Telecom was eventually licensed in December last year after the consortium won the bid to become South Africa’s second national network operator. It has a 25-year operating licence.
Some of Neotel’s clients include Cell C, MTN, Vodacom, Internet Solutions, Telkom, MWeb and Transtel.