Photo by: Duane Daws
The R2.67-billion tie-up between telecommunications group Telkom and information and communication technology (ICT) firm Business Connexion (BCX) could result in a one-stop shop for the small and medium-sized enterprises (SME) market.
The absorption of BCX into Telkom would enhance the ICT value proposition on offer for the smaller businesses, Telkom COO Dr Brian Armstrong said this week.
“BCX and Telkom combined have a wide customer offering for SMEs and would be capable of clear market leadership,” he averred.
Individually, the duo was “struggling to compete” in a new era; however, with the merging of the parties’ network and information technology (IT) infrastructure and an integration and bundling of their offers, Telkom and BCX could “lead the market” in cloud and managed end-to-end IT infrastructure services with a wide customer offering encompassing the “entire ICT stack”, as well as unified communications.
Telkom’s Cybernest would be absorbed into BCX, which would operate as a separate entity under the Telkom banner.
The successful integration of BCX and Telkom would produce an expansive portfolio of network access, capacity of more than 13 000 m2 and infrastructure services offered to the market.
“Like all fixed telecommunications [companies], we need to find alternative sources of revenue growth. We have decided to expand into mobile and IT adjacencies,” Armstrong pointed out.
However, while BCX enabled Telkom to expand its ICT offering, the full value chain was not covered and partnerships with specialised ICT players in business process outsourcing and system integration, besides others, would need to be examined to come full circle with the “ICT stack offering”.