Vox’s strategy behind buying Frogfoot Networks

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By Gugu Lourie

Vox Telecom announced on Tuesday that it has acquired Frogfoot Networks, a South African-based Internet services company, for an undisclosed amount.

The deal is the second to be concluded by the company, which kick-started four months ago a five-year plan growth strategy.

Last month, Vox Telecom’s acquired Wishlist, shoring up Microsoft consulting and integration capabilities, for an undisclosed amount.

Through Frogfoot Networks’ acquisitions Vox Telecom will gain a firm footing in the growing market for the Fibre-to-the-Business (FTTB) and Fibre-to-the-Home.

Furthermore, the company sees this deal fast tracking its own fibre strategy by leveraging the existing skills, processes and installed fibre network of Frogfoot Networks.

Vox Telecom CEO Jacques du Toit, is excited about the acquisition of Frogfoot Networks and trusts the new buy will enable the company to roll out its quality fibre services quicker.

He said the real benefit of buying Frogfoot Networks was the fact that the business has ‘momentum, the skills, track record and time to market’ in the fibre space.

“Frogfoot have been able to speed up our deployment of fibre,” said Du Toit in an exclusive interview with TechFinancials.co.za, adding that the company decided to buy this firm because it shares Vox Telecom’s principles on providing quality services and products including network infrastructure.

Vox Telecom FTTH is currently available in Parkhurst, Greenside, Parktown North, Killarney, Riviera, Waterfall, Craighall, Dunkeld, Craighall Park, Atholl, Elton Hill, Winston Ridge and Constantia.  It will be coming soon to all Telkom fibre suburbs.

Last month, the company launched a first to market uncapped voice package that aims to keep South Africa talking.  Available to customers in suburbs where Vox Telecom is rolling out FFTH, uncapped voice package enables unlimited calls to mobile, national and local fixed line and select international destinations.

Du Toit is optimistic that in the next few weeks Vox Telecom is likely to provide a similar service to the business market

However, Vox Telecom acquisition of Frogfoot Networks and speedy entry into FTTH and FTTH market may pit the company against bigger industry players – such as Vodacom, MTN and Telkom – with big pockets seeking to diversify their revenue streams.

Vox Telecom Fibre
Vox Telecom Fibre

But Du Toit believes Vox Telecom strategy to target precinct with its fibre rather deploying the infrastructure everywhere would create a niche and profitable market for the company.

Vox Telecom is not planning to be a Dark Fibre Africa, a terrestrial fibre operator, or a Vodacom even an MTN for that matter.

Furthermore, the acquisition of Frogfoot Networks proves that Vox Telecom is aggressively pursuing its differentiation strategy and is committed to entrenching itself as an end-to-end technology partner for its customers.

The acquisition of Frogfoot Networks is the fifth in just over a year.

Last October, Vox Telecom bought Two IT and Computer Initiatives, which provide specialist consulting in Microsoft Dynamics and business applications.

Both companies will be merged to create a new division.

The shareholders who decided not to sell the company last year might be pleased with Vox Telecoms’ performance so far, as the firm continues to grow organically and via acquisitions. It is on the road to becoming a fully-fledged integrated technology partner.

Vox Telecom’s CEO Jacques Du Toit
Vox Telecom’s CEO Jacques Du Toit

These shareholders, with deep enough pockets to finance Vox Telecom’s corporate activity, include Investec, Lereko Metier Capital and RMB.

With the backing of its shareholders, Vox Telecom is still on the lookout for more acquisition targets to bolster its business and Du Toit said the firm continues to engage in talks with a number of entities with a view of buying them.

He wouldn’t be drawn into commenting on how much has the unlisted company set aside for further buys and which companies it was eyeing to buy.

But earlier this year, he disclosed that  Vox telecom was also looking at acquisition opportunities in automation, cloud services, digital communications and managed services space.

Vox Telecom is one of the only remaining big telecoms operators and internet service providers in the country, which has not been acquired by bigger operators and seems to be surviving the consolidation phase in the ICT market.

Vox Telecom – which was founded in 1998 – offers alternative voice solutions, data access and ISP services, cutting-edge cloud services, a variety of PBX and video conferencing services, telephony management systems, faxing and text messaging applications.

Du Toit is confident of doubling the size of Vox Telecom in the next five years, or even earlier.

Indications are that Vox Telecom is set to compete aggressively in the market and planning to provide quality services and infrastructure to its customers.

As a small player it could end up muscling its way to lucrative contracts in its niche markets and this may upset the bigger players. This is definitely a company to watch in the next few years.

“The fact that Vox Telecom is becoming a fully integrated technology partner is allowing our customers to differentiate themselves in their own marketplace,” said Du Toit.

 

 

 

 

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