Vodacom signs R1bn deal to exploit Prasa's fibre-optic network
Vodacom scored its second government contract in a week after it entered into a 15-year agreement worth R1bn with the Passenger Rail Agency of SA (Prasa).
©across via 123RF
The agreement, which was signed with Prasa subsidiary Intersite Asset Investments, will see Vodacom Business provide Prasa with products and services such as virtual private network connectivity and hosted exchange platforms, which the rail agency can resell to its customers.
As part of the deal, Vodacom will lease Prasa's fibre-optic cables for the duration of the contract and will make these assets commercially available to the government and other companies including other telecommunications operators. Prasa has more than 900km of fibre along railway lines and at stations that it uses to manage its locomotive traffic. Vodacom said Prasa would be able to generate revenue through its fibre assets and from the resale of Vodacom's enterprise products.
Intersite CEO Cromet Molepo said the company's mandate was to exploit Prasa's assets through the use of strategic partnerships to create value sustainably.
"This partnership with Vodacom is the first significant milestone in our journey towards effective and sustainable commercialisation of Prasa's telecommunications assets, with more innovative possibilities down the road," he said.
Vuyani Jarana, Vodacom Business's CEO, said the local economy was "quickly digitising, the demand for high-speed broadband is increasing daily and optic-fibre network deployments are crucial in the delivery of high-speed broadband services."
Vodacom said last week that it had been awarded a R5bn contract by the finance ministry to provide mobile data and voice services to 1.3-million government employees for four years.
Analysts believe that the decision is intended to save the Treasury money and to provide government departments with a reliable telecoms supplier. The government spends R3.2bn annually on telecommunications - R800m on mobile and R2.2bn on fixed-line. The deals could also indicate a vote of confidence in Vodacom's network and services.
The group has invested billions of rand into its domestic network in recent years. In the year to March 2016, it invested R12.9bn in its networks, targeted primarily at expanding its 2G, 3G and 4G coverage.
Source: BDpro
Source: I-Net Bridge
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