Jasco's playing it safe

ADSL South Africa (Broadband South Africa), 10 May 2007

Electronic and electrical products group, Jasco, is upping the number of its wireless communication service offerings in order ‘…to minimise the effect that Telkom, its major client, has on its bottom line’ (Telkom uncertainty has Jasco crossing the wireless frontier, Milazi, Business Day, 3 April 2007).
 
Is this a wise move? 
 
Yes.
 
ADSL South Africa tends to agree with analysts which ‘…have hailed this as a wise move, given the current uncertainty at Telkom, which recently lost its CEO, Papi Molotsane. He resigned following pressure from the investor community’ (Telkom uncertainty has Jasco crossing the wireless frontier, Milazi, Business Day, 3 April 2007).
 
In other words, Jasco is wise to limit its exposure to Telkom at this stage of the game.
 
Why would Jasco be interested in limiting their exposure to Telkom besides the fact that Telkom is going through a rough spot at the moment?
 
History and aim.
 
‘Jasco felt the full effect of its reliance on Telkom in 2004, when its results were badly affected by a lack of orders in the telecommunications division’ (Telkom uncertainty has Jasco crossing the wireless frontier, Milazi, Business Day, 3 April 2007).
 
In other words, Jasco already learned valuable lessons in this regard.
 
Jasco’s move also fits in with the group’s aim of ‘…becoming a leading infrastructure provider with a focus on wireless access in public networks’ (Telkom uncertainty has Jasco crossing the wireless frontier, Milazi, Business Day, 3 April 2007).

In other words, increasing its wireless communication service offerings fits its aim of becoming a leading infrastructure provider.
 
ADSL South Africa (Broadband South Africa) welcomes Jasco’s move since it will be beneficial to both the group and its clients.