iBurst expands on cellular plans
iBurst has shed more light on its plans to enter the mobile cellular space in an exclusive interview with TechTarget SA.Speaking to the publication yesterday, iBurst executive chairman Thami Mtchali said that his company is already in talks with incumbent cellular network providers in hopes of reaching a roaming agreement.The company is hoping to secure a roaming agreement similar to that which Cell C had with Vodacom where it “piggy-backed” on Vodacom’s network while building up critical mass.“At the moment we have the license, the infrastructure and the staff with the know-how to implement an LTE (Long Term Evolution), network that would rival the existing ones. Our challenge is that we are not big enough to give the existing cellular phones networks good competition,” Mtshali says.For example, Vodacom, which has about 43 million subscribers in total manages about R54 billion turnover every year and only spends about half of that on operating expenses.Although he is bullish about the possibility of being the next entrant in the billion Rand per annum sector, he remains realistic about the fact that the nature of the business is that it takes four to five years before true returns start being realised.“We know how to sell broadband and we already have a billing system in place, all we need is a partner to help us establish ourselves in the cellular space. We would like to start selling voice and data now and have iBurst SIM cards in the market,” Mtshali says.With six years in the business, iBurst’s coverage reaches about 70 percent of the country, with the majority portion of its business in the corporate space.“At the moment MTN is one of our largest customers because they buy ‘last mile services’ from us but at the same time with are a major bandwidth customer of theirs,” he says.Mtshali comments that if his business is to succeed in the cellular business, it will have to be extremely competitive when it comes to pricing and product bundling. “Price is key in this business and that has to be a major focus if a company intends to remain competitive. Some cellular companies have attempted to enter this business thinking their brand alone would make them succeed, but have found out that besides the quality of their service, its all about what the service is costing the customer at the end of the day,” he concludes.