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Web Exclusive: Neotel to increase retail stores
September 22, 2009
By Thabiso Mochiko
Neotel is going to add to its single retail store in Johannesburg by opening a total of three retail stores in Cape Town, Pretoria and Durban to expand presence in the consumer market, the company announced on Tuesday.
The telecommunications group has only one retail store and it is situated in Cedar Square in Fourways in Johannesburg.
Ajay Pandey, Neotel's chief executive, said: “Based on input we believe we can expand our footprint, either directly or through franchisees.”
Neotel's consumer products are sold through Postnet, Altech Autopage and Samsung stores.
Pandey said the company could have signed up 50 000 customers had it not been for the problems that it had experienced in the Western Cape.
Its growth was hampered by the delays in obtaining environmental approval for sites to install its infrastructure in the area.
Neotel is laying fibre optic cable, wireless networks using technologies such as wimax and code division multiple access (cdma) to provide both data and voice to enterprises and consumers. It had so far spent R3.5 billion in capital expenditure.
Wimax is an internet access technology that offers fast data connectivity by wireless connection and cdma is a digital wireless technology uses for transmitting data.
The company, which is majority owned by India’s Tata Group, said it expected revenues to reach R3 billion in the year to March next year.
“This is the year in which we have shifted gears and are second only to Telkom in terms of key telecoms service providers in the enterprise space. If we continue with our growth trajectory, soon we will be counted amongst the bigger players in the entire telecoms space of South Africa,” Pandey said.
Pandey is targeting 15 percent fixed-line market share when Neotel, which is in its second year of operations, turns five.
Noetel like many new entrants is supporting the reduction of interconnection rates. However, Pandey strongly urged that the reduction also be passed on to consumers.
Mobile operators are in the process of lowering the interconnection fees, which are R1.25 between mobile operators resulting in high prices paid by consumers, pressure from small operators and also the public.
“We are in favour of a lower rate but it should be done through a process. It is important for investors confidence. But we have to ensure that the lower costs are passed on to consumers,” said Ajay Pandey, the chief executive of Neotel.
Neotel was launched three years ago and has signed up 30 000 customers and expects to reach 50 000 by the end of the financial year. - I-Net Bridge
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