Consolidation in telecommunications sector is likely – Jordaan

Consolidation within South Africa’s telecommunications industry is likely and in line with global trends, predicts Montegray Capital founder and CEO Michael Jordaan.

Speaking during a financial services group PSG Think Big Series webinar on Tuesday, he said that South Africa had a very strong telecommunications duopoly in MTN and Vodacom.

This makes it challenging for the smaller players, namely Rain, Telkom and Cell C, to compete against this duopoly.

“It is very, very difficult as a small player to have the capital to do countrywide coverage, which is what customers want. I mean, you want your cell phone to work everywhere,” he points out, noting that in most of the markets in the world, there are two or three big players.