Vumatel targets connecting 100 000 homes

Gareth van Zyl

Johannesburg - Fibre broadband company Vumatel is ramping up its network as it aims to bring high-speed internet to thousands more homes.

On Monday, Vumatel announced that it plans to connect 100 000 homes by 2016 after it started its operations just a year ago in Johannesburg suburb Parkhurst.

Since then, the company has been on an expansion drive and announced on Monday that it has added six more suburbs to its portfolio: Hurlingham, Glenadrienne, Hyde Park, Northcliff, Sharonlea and Olivedale.

Vumatel has also started laying fibre in Saxonwold, Parkwood, Riviera and Killarney. Meanwhile, installations in Victory Park, Linden, Bryanston South and Blairgowrie are scheduled to begin in October.

“We are currently making our infrastructure available to approximately 2 000 additional homes a month and still ramping up delivery thereof,” said the chief executive of Vumatel Niel Schoeman in a statement.

“Based on demand we will need to make services available to a further 100 000 homes next year. This demand has resulted in us making a decision to release new areas on our portal so residents can show their support,” he said.

Vumatel, though, is not the only company rolling out fibre networks in Johannesburg, as companies such as Fibrehoods and MTN are also installing the infrastructure in suburbs across the city.
Telkom has also expressed plans to connect fibre to suburbs, but the company has been upstaged by its smaller competitors.

In Telkom’s 2015 integrated report, group CEO Sipho Maseko said Telkom’s wholesale and networks segment of the business “endured a very tough time over the past 12 months”.

“This includes the relentless pressure from smaller providers of fibre, who are far nimbler than we have been, cherry-picking the suburbs they want to service,” said Maseko.

But while smaller companies are beating Telkom to the chase, the CEO of local technology research firm Strategy Worx Consulting, Steven Ambrose, told Fin24 that the fibre-to-the-home market risks becoming consolidated.

"At the moment, there's a massive land grab - a lot of independent companies doing it. It will probably explode for the next two to years with lots of players, lots of fibre going into the ground and then we're going to have a mini sort of meltdown as they all clean up and consolidate because I don't think there is a business plan that can support all these people," said Ambrose.

"The man who's got the most connections wins - that's how it works in this game and that's exactly what's happening."

But regardless of market movements, fibre broadband is the future of South Africa’s internet landscape, especially in urban areas, said Ambrose.

"Fibre to wherever will become the backbone of the new telecommunications revolution going forward - there's absolutely no question about that,” he said.