Cell C leapfrogs into fast lane - Times LIVE

Nov 21, 2010 10:58 PM | By Toby Shapshak

Lars Reichelt was a happy man last week. The CEO launched CellC's new data network in Gauteng on the ninth birthday of the cellular network.

A week earlier, Cell C, Internet Solutions and Convergence Partners had agreed to build a 12000km national fibre-optic network that will cost R5-billion. As they like to say in the internet industry, you can never have too much fibre.

From a new cellphone data network to a new fibre company, the last two weeks brought good news for telecoms in South Africa.

Cell C has aggressively built its new data network and offered some aggressive launch prices (though the final prices haven't emerged yet).

Because it previously focused on voice and neglected expensive 3G services, it has been able to leapfrog directly to new, faster technology called HSPA+. Theoretically, this can achieve data speeds of up to 21.6megabytes a second.

"I don't think there is a third operator in the world that has, in 10 or 11 weeks, leaped to the front of the leagues in a very big country," Reichelt said proudly.

"There are not many countries in the world with this kind of population coverage, at that kind of speed. South Africa has become a world leader. There are not many European countries, or [places in] the US, where you get the kind of speeds you are getting here."

Reichelt added: "By the end of 2011 we aim for 97% population coverage with HSPA+. By mid-2011, we want to cover 67%."

Right now, he said, 32% was covered, reaching 34% by the end of the year.

These are bold pronouncements, and Cell C has been able to build its next-generation network for two reasons.

First, you can build anything, and build it quickly, if you throw enough money at it.

Second, because Cell C has previously gone after only voice minutes at the bottom-end, pay-as-you-go market, it had no 3G network. This meant it did not have to sweat its expensive assets, as the other operators have.

Reichelt is a clever CEO who has re-engineered the third network operator as much as its data network. He converted crippling debt to equity. He sold off its cellular towers and refinanced the company.

Along the way, he changed focus from voice minutes to data, the big growth area for networks around the world as data-hungry smartphones become increasingly popular, as do their data-loving apps.

Cleverly, Cell C has gone after the small towns and rolled out its new network in coastal cities such as Port Elizabeth, Durban and Cape Town, before moving inland to Bloemfontein and Gauteng.

Like every geek and tech journo, I have been testing Cell C's network and am impressed with the speeds.

Reichelt showed off connection speeds from the major speed tester to demonstrate how CellC has leapfrogged to the top. In part, this is because it has unfettered access to the 900GHz spectrum, which is better suited to providing data services, requires fewer base stations to provide coverage, and transmits through walls more efficiently, giving a stronger signal indoors.

The test will come when it has more users.

Cell C might be the underdog in the cellphone industry, but, as Arthur Goldstuck, MD of World Wide Worx points out, they are the third-largest customer-carrying company in South Africa, with 7million customers - or 14.5% market share - behind Vodacom (23million, 49.5%) and MTN (17million, 36%).

The good news for consumers is that more competition generally translates into greater choice and better prices.

•Shapshak is editor of Stuff magazine