Vodacom, South Africa’s largest cellular network provider, is on the path to spend approximately R17 billion this year all told. They recently announced that they plan to spend R9 billion on network upgrades in the next 12 months, which is a 30% increase on what was spent in the last year to March.
Spokesperson Richard Boorman said that the bulk of the investment will go towards base stations and transmissions, adding to Vodacom’s network of approximately 10 000 base stations.
In addition to this Vodacom is spending R7 billion on buying out Neotel, an internet service provider and South Africa’s second national operator. While the deal is still subject to regulatory approval, the companies have begun working on the process.
The acquisition of Neotel will enable Vodacom to increase its internet and data services, as well as gain access to valuable spectrum which will give them a huge advantage in the mobile data market.
Vodacom is also spending around R900 million to buy back the 400 000 Vodacom customers that Nashua Mobile served after Nashua Mobile announced in April that they would be closing down.
Vodacom is also looking to stimulate growth and gain traction in the Democratic Republic of Congo (DRC) where they have just settled a dispute with their DRC business partner, Congo Wireless Network (CWN).
Vodacom Group CEO, Shameel Joosub has said that their main goal is to increase market share in the country, from the 51% they currently have, to an even larger chunk. While they currently have 10 million subscribers in the DRC they are hoping to double that in the next five years.
They will however have to overcome problems such as a high churn rate caused by lack of coverage and infrastructure in that country.
Elsewhere in Africa MTN has announced plans to spend US$3bn (about R31bn) to upgrade its network in Nigeria over the next three years. This is part of a drive to improve the quality of their service in the country where they have 57.2 million subscribers and a market share of just under 50%, making Nigeria MTN’s biggest and most profitable market.