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Telkom will offer customers on-demand video streaming and music from September, part of its plans to try to increase revenues and subscriber numbers in its mobile business.

Telkom, 39% owned by the government, is introducing the new products in a rapidly changing market where rival mobile network operators are competing to attract customers and maximise profits.

Telkom is one of five main firms that dominate the wireless broadband market, including MTN and Vodacom, which controls about 70% of the market.

Speaking on the sidelines of the new product launch, Telkom consumer CE Attila Vitai said the company expected the new service to boost its mobile revenue as new customers upgrade their data packages.

"This will act as a market stimulus and we’ll get more and more customers to FreeMe just to get this service. So we think our revenues will rise as a consequence of this," Vitai said, without giving an estimate.

Telkom overhauled its mobile product in 2016 and introduced data mobile packages called FreeMe to boost its mobile business, which contributed to core profit for the first time in 2016.

Telkom LIT will provide its FreeMe customers on a two-gigabyte and higher packages the ability to stream movies, television, videos and music on demand at no extra data cost.

The company said it had partnered with Naspers’ Showmax, Netflix, YouTube and Google Play for LIT Video and Google Play Music, Apple Music and Simfy Africa for LIT Music. It will also launch LIT TV.

The company completed the turnaround phase of its strategy in 2016 which included cutting jobs, outsourcing services and selling some properties. It was now looking to boost its mobile business to offset the falling use of landlines.

Responding to a question on the government’s plan to sell its Telkom stake, Vitai said Telkom "will accept it and work with them if they decide to sell to a third party".

The government is considering selling its stake to fund a R10bn bail-out of South African Airways.

Reuters

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