Telkom plans to move into new market areas during the next six months, and will leverage its core network in making a number of moves designed to lessen its reliance on fixed line voice communications.
In a statement accompanying its latest six-month results, Telkom acknowledges that the competitive landscape has changed with Neotel as well as ISPs (Internet service providers) and VANS (value-added network service providers) now competing for fixed-line revenue.
Not only is the market being eroded by alternatives offerings, but competition is driving lower prices.
"The fixed-line business intends to aggressively reposition itself within the African telecommunications environment," reads the statement.
"Telkom's prime asset and core strength is its network. Telkom's Board and management have developed strategies to leverage this asset to drive revenue and profit growth into the future."
Telkom's NGN (next generation network) provides network intelligence, which it will leverage in order to provide for the increasing demand for capacity, new data and converged products.
"In this respect, Telkom is uniquely positioned in that it has built and owns the backbone infrastructure for the mobile networks in South Africa. Telkom also has the opportunity to explore methods of exploiting the arbitrage between fixed and mobile pricing and benefitting from the saving on interconnection costs.
"Having mobile capabilities will also improve Telkom`s ability to secure opportunities for growth on the African continent. "
Telkom will also extend its data hosting capabilities in South Africa and Africa and will explore opportunities around synergies through the bundling of network services with IT and hosting capabilities.
It is also looking to Africa as a new market for its services.
"The conclusion of Telkom`s mobile strategy review with the announcement on November 6, 2008 of the sale of 15% of Telkom's stake in Vodacom to the Vodafone Group and the unbundling of the remaining 35% stake to Telkom's shareholders will result in the termination of the shareholder agreement between Telkom and Vodafone.
"The ending of the restrictive conditions contained in that agreement will allow Telkom rapidly and aggressively to reposition itself to take advantage of the strength of the fixed-line network to move in to fixed-mobile convergence."