This is the view of Sabelo Dlamini, Senior Research and Consulting Manager at the International Data Corporation (IDC), who was speaking to CNBC Africa.
Dlamini said the telecommunications industry is experiencing a challenging time, with voice revenues declining while data prices are under pressure.
He said while data consumption is increasing, consumers expect to pay less every year for data – which puts financial pressure on network operators.
This means that traditional telecommunications revenue from voice and data is shrinking. This, in turn, is prompting operators to look for new revenue streams.
Dlamini said international telecoms companies are moving into new products offerings like cloud and data centres, big data analytics, data monetization, AI, and IoT.
A few operators are also moving into fintech and financial services to diversify their product range and try to make up for lost revenue.
Job cuts not enough to make Telkom sustainable
Dlamini said Telkom’s planned job cuts may be enough to improve the company’s balance sheet, but it will have to adapt to become future-proof.
He said Telkom will have to increase its investment in infrastructure and the latest technologies to remain competitive.
He added that it is important for Telkom to start investing in these improvements now to remain relevant in the next decade.
Dlamini highlighted that Telkom gave its competitors an advantage in the fibre market by starting late, which means it lost its fixed-broadband dominance.
It therefore needs to start investing in new technologies like AI, big data analytics, and IoT to prepare for the next 5-10 years.