TelkomONE bites the dust

Telkom has exited streaming and has handed over its platform TelkomONE to the South African Broadcasting Corporation (SABC), effective on 17 November 2022.

Telkom launched TelkomONE in November 2020, offering a range of free content, including SABC, news channels, and paid-for movies and TV shows.

Telkom signed a five-year digital carriage agreement with the SABC as part of the video-on-demand offering.

TelkomONE streamed SABC television channels 1, 2, Sport, and Education and all 19 SABC radio stations.

In exchange, the SABC received a carriage licence fee and a share of the advertising revenue generated on the TelkomONE platform.

In May 2021, Telkom said TelkomONE had surpassed expectations. “Every week, more South Africans find their way to the TelkomONE platform on their mobile phone, tablet or laptop,” it said.

Telkom continued to punt the success of TelkomOne in its latest annual report, saying the streaming service has seen consistent growth.

However, it is nothing the market has not heard before. Cell C said the same before it cancelled Black, and Vodacom also talked up Video Play before it was discontinued.

Yesterday, Telkom announced that it was decommissioning TelkomONE and transferring the service to the SABC.

TelkomONE’s existing customer base will be migrated to the SABC, and they will be notified and transferred to the new SABC platform at launch.

Telkom put on a brave face and tried to spin the failure as a natural progression for the service.

“The platform has now matured and is ready to scale under the management of the SABC’s broadcasting expertise,” Telkom CMO Gugu Mthembu said.

The reality is that Telkom, like Vodacom, MTN, and Cell C, thought they could achieve what no local telecommunications company could – launch a successful streaming service.

It is the second time Telkom has tried to enter the entertainment market. In 2006, the telecoms company created Telkom Media.

Telkom received a commercial broadcast license in September 2007 and built a large company to take on DStv with South Africa’s first IPTV service.

The plan was to invest R7 billion in Telkom Media, with R3.5-billion coming from Telkom.

By March 2008, Telkom started to get cold feet, announcing it would cut its funding to Telkom Media to R2.2 billion.

Soon afterwards, Telkom said it would no longer invest in Telkom Media. It sold its stake in the media company – and its broadcast license – to Shenzhen Media Group in 2009.

Telkom Media’s failure did not deter MTN, Vodacom, and Cell C from trying to do the same thing.

These companies were desperately looking for a way to replace dwindling voice revenue, and consultants punted content as the logical next step.

MTN launched its streaming service FrontRow in December 2014 but shut it down in May 2017 because of a lack of demand.

Cell C launched its entertainment platform, Black, in November 2017 and pumped R1.5 billion into the project. Again, there was no demand, and Black was discontinued in November 2019.

Vodacom also shrugged off Telkom Media and MTN’s FrontRow failures and launched Video Play in August 2015. It quietly pulled the plug on the streaming service in June 2022.

The table below shows the streaming services which were launched by South Africa’s major telecommunications companies in South Africa.