Johannesburg - Aviat Networks, which says it has struggled to grow in South Africa because it lacked black economic empowerment credentials, has launched a joint venture – Aviat Ubuntu Technologies – with local firm Ubuntu Technology.
On Friday Straus Odendaal, the chief financial officer of Aviat Networks, which counts cellular network operator MTN among its existing clients elsewhere in Africa, said the firm was seeking further growth in South Africa, where the multinational firm had been operating through an agent since the apartheid regime.
But in the new dispensation the set-up was proving to be a constraint when it found it challenging to secure business in the public sector and with large telecoms firms locally.
The agreements it holds with MTN are for the latter’s networks in Ghana and Nigeria. Last week Aviat announced that it had concluded an expanded managed services contract with MTN Nigeria which entailed the planning and deployment of Aviat equipment on the MTN Nigeria network.
Nasdaq-listed Aviat, which is present in more than 100 countries worldwide, is a global leader in the provision of network solutions using microwave technology, which is considered to be a cheaper technology than the fibre-optic networks that are being deployed across the country.
At this stage, the parties do not expect to develop products in South Africa and Aviat’s intellectual property would not transfer to the new subsidiary. “What we are doing is [creating] purely a marketing arm that will drive sales,” he said.
Aviat owns 51 percent of the joint venture and black-owned Ubuntu holds 49 percent. The value of the transaction was not disclosed. The subsidiary would be capitalised on a pro rata basis according to the shareholding, as required to service customer requirements, the parties said. The scope for the creation of new jobs had not yet been defined.
The partnership will give Aviat access to parastatals and government departments and experience in operating in the public sector, which Ubuntu Technology has honed over its 17-year history. This will enable Aviat to leverage the expertise it has developed in the US for the development of mission-critical applications for public safety, utility and government and defence organisations.
“There’s a huge requirement for a closed network with high security [in the public sector],” Allen Tshabangu, the chief executive of the new venture and an industry veteran with 20 years’ experience, said on Friday.
The companies are targeting infrastructure spend in municipalities. Tshabangu added that a less publicised fact was that the government’s infrastructure roll-out extended to state-owned firms such as Eskom, Transnet and the SAPS
Odendaal said: “We’ve seen now… we could offer services which bring us to the pain points in the market.”
Ubuntu has traditionally focused on back-haul network solutions and data centre services. Tshabangu said the company intended to build up an offering of value-added services such as cloud computing, virtualisation and storage services for the enterprise market, including the third tier market that included internet service providers.
Both firms are in discussions to extend the partnership into servicing other cellular network providers in the rest of Africa and the Middle East. - Business Report