South Africa’s Telkom continues to lose fixed line access customers as some of them migrate to fibre, fixed wireless access and WiFi.
The company reported on Tuesday that its fixed access lines in service have dropped by 9.6% to 2.5 million in the six months to end-September versus 2.8 million in the same period last year.
Fixed-line voice usage and subscription revenue decreased by 14.5% to R5.4 billion, as the declining trend accelerated in the current period driven by migration to new technologies and a 9.6% decline in the number of fixed access lines.
Fixed interconnection revenue increased by 28.1% to R410 million, mainly due to the international interconnection revenues which improved by the weakening of the rand against foreign currencies.
Telkom added that fixed broadband subscribers fell by 2.5% to 974 181 versus 999 33.
However, the company said the refarming of its 1800 MHz spectrum is paying dividends with smartphone subscribers increasing by 83.9% to 3.8 million.
“Our fixed wireless access and WiFi continue to do well with an increase of 22.1% to more than 962 000 customers, driven by our popular “deal of the month”, improved quality and the footprint expansion of our LTE network,” Sipho Maseko, Telkom CEO, said.
In the six months to end-September 2018, Telkom launched the first Unlimited LTE offering, including VoLTE and “attractive” calling rates and an extension of VoLTE across the entire LTE portfolio.
“We are seeing significantly more fibre customers, albeit from a low base, driven by an increase in new-to franchise businesses and the migration of DSL customers to fibre,” said Maseko
“Our fibre acceleration has been stimulated by the ongoing onboarding of third-party fibre network service providers to extend the fibre reach.”
Maseko added that the company has instituted specific initiatives to counter the decline in the fixed business, such as innovative fixed-broadband products (led by the Unlimited product suite as well as customer speed upgrade migrations) and content offerings.
The company has also started migrating selected traditional fixed-line customers to wireless technologies.
“We have made progress with the migration of consumer fixed-line customers onto the next-generation network platform, and we are now supporting our consumer customer base from a single converged fixed-mobile platform.”
Telkom’s fibre-to-the-home users rose 30.8% to 393 000, while Fibre-to-the-cabinet increase by 7.7% to 2.3 million.
“The investment in fibre to the home was rationalised in the period as we continue to focus on areas which show a propensity for higher connectivity rates,” said Maseko.
“Our fibre to the home connectivity rate has improved to 35.6% when compared to 24.5% in the prior year.”