Nepal’s leading telco Ncell is close to buying Classic Tech in a historic deal. As per reports, an initial deal has been reached for this remarkable takeover, but the deal is yet to be finalized.
According to sources, Ncell has reached an agreement for the takeover with Classic Tech. And after the deal goes through, the current investors in the private ISP will exit from the company, several portals have reported quoting a source.
- Which internet service to buy? Check our list of the top internet service providers in Nepal and make your decision
Ncell to buy Classic Tech and what does it mean?
Ncell deal of Classic Tech seems less surprising but sensational. There were suggestions that Ncell was in for a takeover of a large enterprise for FTTH fiber internet service or start afresh. It seems to have materialized. However, it’s the first time that a telecom company will acquire an internet service provider with Fiber service. The move also catapults Ncell in the active fixed internet market.
Ncell has recently renewed its GSM cellular license for the next five years. Starting its ISP venture is seen from a meaningful perspective. The telco reaches 25 years in service in 2086 and might have to think of what is after it. The takeover of Classic Tech could be related to its sustenance and business diversification.
Although telco and ISP fall into different service category, they seem to be competing for a market like Nepal where less people use mobile data on the go and WiFi (with mobility) is everywhere. However, Ncell wants to use the internet network to complement each other in this challenging environment.
Ncell’s immediate competition- Nepal Telecom (NT) operates both mobile and FTTH internet under NT Fiber. Ncell is on the path to emulating the same with the Classic Tech acquisition.
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Why Classic Tech?
Classic Tech is an internet and network service provider in operation since July 2009. The company despite being in a hot playground with tough competitors has made exceptional growth in recent years. But the company has witnessed struggles in recent months on the basis of its customer base. These conditions may have helped broker a deal between Ncell and Classic Tech’s current owners.
As per the latest report by Nepal Telecommunications Authority (NTA) data, the company has 1,63,160 users across the country.
Despite all the nitty gritty, Classic Tech is a national-level ISP and has coverage across 74 districts. Ncell’s entry could elevate its service expansion and also help the telco as a new vertical. The telco has just celebrated its 19th anniversary and seems bent on making big decisions to scale up its business scalability.
Related: Classic Tech IPTV service “Caro TV” launches with big offer
Classic Tech occupies a 5.79% market share in Nepal’s internet market while Ncell boasts a 36.45% market share in terms of SIM subscriptions. Now let’s wait and see how the deal emanates and wonder if Ncell use the internet service in its own brand name.
What do you make of Ncell’s acquisition of Classic Tech? Will the acquisition of the ISP by the telecom operator fly? Do share your opinion in our comment box below.