Big Openserve fibre connection surge

Telkom recorded tremendous growth in fibre-to-the-home (FTTH) connections on its Openserve network over the past year, according to the telecoms company’s latest quarterly trading update.

As of 31 December 2023, the fibre network operator (FNO) had 567,350 homes connected to its fibre network, an increase of 97,794 from the 469,556 it had a year earlier.

Fixed-data traffic grew by 24.4% to reach 612 petabytes of consumption during the quarter.

Due to this growth, Openserve’s fixed-data next-generation revenue climbed 6.2%, while the EBITDA for this segment was up 7.0% to R1.014 billion.

Openserve also expanded its FTTH network by an additional 163,612 stands to reach 1,185,623.

Due to the number of connected customers increasing by more than the new stands on a percentage basis — 20.8% versus 16.0% — Openserve increased its connectivity ratio from 47.4% to 47.9%.

That means close to half of all households with access to the Openserve FTTH network have a connection in their homes.

This is the highest figure among major FNOs in South Africa, which typically have between 25% and 40% connectivity ratios.

It is not cost-effective to roll out to households which don’t sign up for a connection with your FNO.

Despite Telkom’s significant advantage in the fixed-line business in South Africa from the 1990s to the early 2010s, Openserve has been relegated to the country’s second-biggest FNO.

Vumatel beats it in terms of homes passed and connected.

The Remgro-owned FNO had over 2 million homes passed with FTTH by late 2023, and around 658,000 customers connected by August 2023.

The table below summarises the homes passed, homes connected, and connectivity ratios of South Africa’s biggest FNOs.

Telkom also said it saw a decrease in xDSL services to approximately 82,000 due to Openserve’s focus on modernising its network with fibre deployments.

Despite the decline, Openserve reported overall broadband growth of 6.6% to over 670,000 “connections”.

However, Openserve’s fixed broadband subscribers as of 31 December 2023 only stood at 556,965.

This is not only less than the number of broadband customers but also nearly 10,000 less than those “connected” on FTTH alone.

MyBroadband has contacted Telkom for clarity on what these numbers represent.

Although Openserve’s revenues from fixed broadband increased, its fixed-line voice service revenue plummeted by 25.4%.

That resulted in Openserve’s overall revenue declining 3.1% for the quarter to R3.120 billion.