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02 April 2012

Customers lose out on rollout delays

Telkom is confident that its robust Procurement Policy and the process of applying it will stand up to scrutiny, despite recent attempts to challenge tenders issued by the company in court.

Last week the High Court granted an interim interdict pending the finalisation of a dispute resolution process between Telkom and ZTE Mzansi. Pending the outcome of the dispute resolution process, Telkom is interdicted from implementing the tender and concluding any service level agreement with the bidders.

While Telkom is committed to finding a resolution to the dispute as soon as is practically possible, the Company is concerned at the recent trend of challenging the awarding of key tenders in the courts.

This often has serious consequences for customers by stalling rollout plans unnecessarily, says the Company.

Telkom Group CEO Nombulelo Moholi today said: "It is Telkom's Procurement Policy and Procedures that are on trial here. I am confident that they will not be found wanting."

"Telkom is often considered to be fair game by losing bidders who may feel entitled to be awarded business by the Company. We are often taken to court on review without any foundation whatsoever.

"Whilst one has rights to challenge administrative actions, unfortunately, the loser in this case is the end user, our customers who have to wait for months on end, and sometimes even years, to receive quality service.

"Meanwhile, Telkom will undoubtedly be accused of poor or late execution of network solutions to the advantage of our competitors," said Ms Moholi.

During July 2011 Telkom published a tender (RFP 0328/2011) for the provision of a Multi Services Access Node ("MSAN"). ZTE Mzansi ("ZTE") had submitted a bid but was not shortlisted because it failed to meet certain technical critical criteria during the evaluation process.

Telkom awarded the RFP to Huawei and Alcatel-Lucent Technologies on 21 November 2011, after having followed a fair, open and transparent procurement process, which process was also validated by external auditors. Telkom upholds the highest standard of governance in its procurement processes.

The agreements were concluded, and the delivery of the first MSAN units was announced on 28 March. This network upgrade will deliver the long-awaited higher speed broadband and fibre to the curb and/or premises.

During January 2012, ZTE served an application upon Telkom seeking to restrain Telkom from implementing RFP 0328/2011 in terms of an interim interdict, pending the finalisation of a dispute resolution process. Telkom and Alcatel–Lucent opposed the application.

For further enquiries, please contact:

Pynee Chetty

Senior Specialist: Media Relations

Group Communication

Tel:+27 12 642 1716

Mobile: +27 81 389 7874

Email: chettpr2@telkom.co.za

 OR

Leigh-Ann Francis

Specialist: Media Relations

Group Communication

Tel: +27 12 642 1728

Mobile: +27 81 391 4780

Email: francilm@telkom.co.za

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ABOUT TELKOM:

Telkom is a leading communications services provider in South Africa. We had consolidated operating revenue of R16.8 billion and normalised profit after tax of R1, 683 million for the period ended 30 September 2015. Total assets amounted to R41.9 billion and equity attributable to the owners of Telkom to R23.5 billion as of 30 September 2015. The group generated normalised free cash flow of R1.4 billion for the period ended 30 September 2015.

As of 30 September 2015, we had approximately 3.3 million telephone access lines in service and 1,030,441 ports connected via MSAN access. We offer business, residential and payphone customers a wide range of services and products, including:

  • fixed-line retail voice services using PSTN (Public Switched Telephone Network) lines, including ISDN (Integrated Services Digital Network) lines, and the sale of subscription based value-added voice services and calling plans;
  • fixed-line customer premises equipment rental and sales services both voice and data needs and these include PABX, Computers, Routers, Modems, Telephone handsets and other ancillary equipment;
  • interconnection services, including terminating and transiting traffic from South African mobile operators, as well as from international operators and transiting traffic from mobile to international destinations;
  • fixed-line data services, including domestic and international data transmission services, such as point-to-point leased lines, ADSL (Asymmetrical Digital Subscriber Line) services, packet-based services, managed data networking services and internet access and related information technology services;
  • Data Centre Operations includes e-commerce, application service provider, hosting, data storage, e-mail and security services;
  • W-CDMA (Wideband Code Division Multiple Access), a 3G next generation network, including fixed voice services, data services and nomadic voice services;
  • mobile communication services, including voice services, data services and handset sales through our mobile navbar-brand called Telkom Mobile;
  •  information and communication services including cloud services, infrastructure services, workspace services, global service integration management and hardware and network equipment sales locally, in seven African countries, the UK and Dubai through Business Connexion Group; and
  • other services including directory services, through Trudon (Pty) Ltd, wireless data services, through Swiftnet (Pty) Ltd.

Convergence is one of our key strategic initiatives in building a sustainable future for Telkom.  We will lead the provision of converged services in South Africa in support of our mission statement: Seamlessly connecting people to a better life.