Telkom spins off new ‘Openserve’ division

Johannesburg - Fixed-line business Telkom has launched a new separate wholesale broadband division dubbed ‘Openserve’.

The move forms part of Telkom’s turnaround process to separate its wholesale and retail divisions so that it can focus more on customers and “establish clearer lines of accountability”.

Openserve is set to supply wholesale fibre broadband access, metro ethernet, IP (Internet Protocol) Connect and SAIX (South African Internet eXchange) services. Openserve will also be a reseller of DSL internet services.

The new business is described by Telkom as South Africa’s largest telecommunications infrastructure provider with the biggest broadband network.

Openserve will further be a “redesigned wholesale partner” for Telkom, but is expected to be autonomous, agnostic and will be responsible for its own profit and loss account.

“We’ll make this service available on a non-discriminatory basis so that anyone can wholesale our network,”  Alphonzo Samuels, managing director for Openserve, said on Tuesday.

The separation further signals Telkom’s contribution to a more competitive market and lower broadband prices for consumers, said Samuels.

Telkom chief executive officer Sipho Maseko said "our new division must be able to compete with its peers; we'll deploy networks faster”.

"A South Africa that offers broadband for all is a strong and prosperous South Africa,” said Maseko at the media briefing.

In an interview with Fin24 earlier this year, Maseko hinted at the reasoning for the separation of the company’s businesses.

"The wholesale business will focus on the ISPs, make sure that those are their customers, the culture is different, the performance incentives are different, the targets are different and they have to treat all of their customers on an equivalent basis,” Maseko said.

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