Telkom CEO Reuben September on Tuesday reiterated the need to get its mobile offering up and running to become South Africa's fourth mobile operator, following a nine percent decrease in Telkom South Africa's traffic revenue.

The group said it would spend six billion rand to implement mobility over a five-year period, with an entry stage set for 2010.

September said the continuing trend highlighted the imperative need for the group to enter the mobile market, particularly the mobile data and voice market.

Speaking at a presentation of the group's results, a day after they were published, September said: "Telkom's top priority is the major challenge within mobile data and mobile voice.

"Fixed mobile converged strategy an imperative for company — to reduce cost through a different operating model," he said, adding that radical changes did not come without pain and cost …"we are confident that it will deliver in the future."

Not a cold start

September said that mobility in Telkom was based on a number of strengths, on channels already existing in the group, "so it's not a cold start".

The chief executive said that mobile penetration voice was at 85 percent, but mobile data was at an early point entry, which pointed to a lot of potential.

However, the group added that coming in as fourth market operator, "when we compare our self to Cell C — we come in not as a new operator without any assets, working assets, we come in with a very strong base … as a mobile addition to our fixed line offerings," said Nombulelo Moholi, managing director of Telkom South Africa.

"We believe there is room for a fourth mobile operator… we have the backbone and experience to be that company," Moholi said.

The first offering of its mobile business is set for 2010.

Bring to the mobile communications table

"I would be surprised if we sat here this time next year without a full mobile operation," September said.

"The business plans for both the mobile strategy and data centre operations have been approved by the board of directors after extensive market research," September said in an earlier statement.

"I am confident that the strength inherent in the fixed-line network and the business leadership and operations skills of our employees will allow us to offer our markets simple, quality, cost-effective services that will be competitive in our markets," he said.

When asked what the group would bring to the mobile communications table, September said: "Fixed mobile conversion, adding to fixed line offerings, we are adding to that a mobile component."

On Monday, Telkom reported interim headline earnings per share down 37.9 percent to 242 cents for the six months ended 30 September.

The group said basic earnings per share declined 141.2 percent to a 150.2 cents loss.

Operating revenue was up 4 percent to R18.7-billion.

Interconnect revenue was up 52.5 percent to R1.46-billion.

Operating revenue from the Telkom South Africa segment increased by 2.9 percent to R17.026-billion, from R16.554-million earlier, the group said.

However, September said: "The negative effect of growing competition and fixed to mobile substitution is starkly highlighted in the 9 percent decrease in Telkom South Africa's traffic revenue."

The group saw a 51.1 percent increase in Do Broadband subscribers, to 232 796, while ADSL subscribers increased 22.6 percent to 602 720 from September 2008.

Total data revenue increased 8.7 percent to R4.85-billion despite significant price reductions.

"We remain committed to a 10 percent reduction in operating expenses by the 2011/12 financial year", September said.

I-Net Bridge

Maroga's salary summary Parliament was told exactly how much Eskom's former CEO, Jacob Maroga received in his pay packet.

Mobilise your life Rebekah Kendal explores how to use mobile applications to mobolise your life.

Behind ANC battle lines The ANC-led alliance has demonstrated a dangerous nature since Jacob Zuma became president.