Neotel in distribution deal

Neotel will not say which chain it has chosen, but it is understood to be a telecoms and technology specialist rather than a department store or a Makro-type outlet.

One source says the chain has roughly 120 branches across the country.

“We are in the process of finalising the contract and we will announce the new reseller fairly soon,” spokesman Zinhle Modiselle said Thursday.

“We can't say who it is before it's signed, but it's an established chain that is aligned with our business. It's a business that is easily accessible and they know how to provide a service to our customers.”

At the moment potential customers can sign up for Neotel's services only at Postnet stores or via the call centre or online.

Its consumer offerings were launched in May, providing a package of voice calls and high speed internet access from R299 to R999 a month. The service is built around a handset that plugs into a computer and serves as a telephone and a wireless internet access point.

Neotel's target is to sign up to 60000 consumers within nine months, and Modiselle would not say how many had signed up so far.

It is competing with the well entrenched Telkom, iBurst and the cellular operators, which have better network coverage and established outlets.

Network coverage remains Neotel's weakness so far, with its consumer services limited to major urban areas in Pretoria, Johannesburg and increasingly in Cape Town and Durban. Potential users can see whether their home is covered on Neotel's website.

Neotel also aims to open a chain of its own branded outlets, and a team is now identifying suitable sites in areas where its services are available.

No decisions have been made on whether those will be run by Neotel itself or by franchisees, nor on how many stores it will open.

“We need to get the right stores in the right places where our market is,” Modiselle said. We have started looking at various venues and negotiating.”

To make sure that it reached consumers as quickly as possible, Neotel first had to strike the deal with the established retail chain before introducing its own branded stores, Modiselle said.

Source: Business Day

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