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Wednesday, November 24, 2010

Multi-Links Telkom to exit CDMA segment

Multi-Links Telkom Nigeria has commenced repositioning that would see to its exiting the Code Division Multiple Access (CDMA) segment in the country, alleging financial and commercial challenging.

The exit is expected to last for upward of four months.

Spokesperson of Multi-Links Telkom Nigeria, Mr. Vincent Raseroka accompanied by his counterpart at Telkom Group, Zeona Jacobs, said that the planned exit of CDMA segment has been approved by the telco’s board of directors.

He also said that the decision was entirely a business imperative for Telkom Group, especially when its market share has remained at 2.6 per cent, invariably dominated by the Global System for Mobile (GSM) technology.

“It is strategically, financially and commercially challenging for us to continue to do business in this segment,” Raseroka said, stressing that it is imperative for the operator to explore other options and chart a new path to growth.

He explained that Telkom has profitability prospect by streamlining its business on fixed infrastructure in the country.

According to him, a number of contracts have rendered Multi-Links Telkom’s CDMA business unprofitable and unsustainable, maintaining that they are still committed to ensure sustainable long-term benefits.

He insisted that the plans to exit CDMA must be conducted in a way that it would not affect the existing customers and employees who are rendering the CDMA services.

“Our existing customers on CDMA would continue to enjoy the same qualitative service during this phase as the company considers market segment migration,” he declared.

He assured that they would make the migration within the ambit of the laws regulating the industry in the country.

Also speaking, spokesperson for Telkom Group, Zeona Jacobs, said a number of expressions of interest have been received by the management of Telkom from both local and international industry players.

Jacobs said these interests would be evaluated and quantified appropriately before a final decision is reached on the myriad of options available to Telkom.

The chief corporate affairs officer, Mrs. Ijeoma Abazie in a related press statement made available to ITRealms Online, quoted the acting Group chief executive officer of Telkom, Mr. Jeffrey Hedberg as saying that this was one of the strategies to stabilize the group’s business across the continent.

“It is essential to stabilize the business by allocating our resources more efficiently,” he said,
Further, Hedberg was quoted as saying that the group is doing so by exiting CDMA segment in Nigeria in addition to closing down non-strategic parts of the business and focusing on international activities primarily on corporate customers.

This, he pointed out, would facilitate the group’s desire to focus and allocate capital appropriately.

“… To allocate capital more efficiently to those areas of the business that deliver a customer solution and drive revenue growth and margin,” he said.

Abazie emphasised that the latest development has turned Multi-Links Telkom into a beautiful bridge, especially given its over 8,200 kilometers of Optic Fibre cable transmission network.

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