IT & Telecoms
From The Report: South Africa 2013
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South Africa has a sizeable “digital divide”, with urban areas benefitting from a range of modern technologies while rural areas tend to be less connected. However, with a renewed draft broadband policy, South Africa now has a framework for developing the ICT infrastructure that will help its economy modernise and thrive. In the sphere of backhaul infrastructure, the private sector has a strong presence and is increasingly extending high-quality services to areas of high demand. Competitive as it is, South Africa’s telecoms sector continues to see growth and attract the attention of foreign investors. Average revenue per user has stabilised recently, and operators are pushing for greater take-up of data services to bolster margins. Options for potential new entrants to the market include launching a mobile virtual network operator or acquiring a smaller player already in operation. Building up a new network is considered unlikely due to the cost, although infrastructure sharing could bring this down.
This chapter contains an interview with Andile Ngcaba, Chairman, Dimension Data; and a roundtable with Alan Knott-Craig, CEO, Cell C; Karel Pienaar, Group Chief Strategy Officer, MTN SA; and Shameel Joosub, CEO, Vodacom.

Articles from this Chapter

Overview

Wired up: Planned investments in broadband infrastructure aim to connect the country and support the IT services industry
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In the most affluent parts of large South African cities, ICT infrastructure is often world-class, with high-bandwidth fibre-optic cables to long-term evolution (LTE) mobile connectivity and a range of service providers. But, reflecting its stark disparities in income and the contrast between urban centres and the less-developed countryside, South Africa has a sizeable “digital divide”. Addressing the gap between the technology haves and have-nots is a national priority. In the sphere of backhaul…

Analysis

Linked to the world: Connections to global networks help position the nation as an IT services hub
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At the tip of the continent, South Africa’s position has long made it a natural trade entrepôt, and is now seeing it become an increasingly important centre for global telecommunications. Rising international connectivity is helping boost the country’s competitiveness as an ICT service exporter. International Connections As of the end of 2012, South Africa had six international submarine cables, with a total capacity of 29.5 terabits, according to the Department of Communications (DoC). Major…

Interview

OBG talks to Andile Ngcaba, Chairman, Dimension Data
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Interview:Andile Ngcaba How good is Africa at advancing and adopting information and communications technology (ICT)? ANDILE NGCABA: ICT is a rapidly evolving global industry and one that experiences booms and busts from which new innovations emerge, and new regions take the lead. Up until 2000, Europe was outpacing the US in leading technological innovations in the mobile environment. Yet today, Europe is lagging behind the US, with Asia slowly picking up. While Africa is far behind, in…

Overview

A competitive environment: As the sector matures, increased data usage and expansion of broadband services offer a path to growth
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Competitive as it is, South Africa’s telecoms sector continues to see growth and attract the attention of foreign investors. Meanwhile, falling prices are driving increasing volumes – contributing, with rising data usage, to a stabilisation of average revenue per user (ARPU). Operators are seeking growth from greater use of value-added services (VAS) and through offering competitive packages to subscribers. The market’s dynamism has been increased by better management of some key players, and…

Interview

OBG talks to Alan Knott-Craig, CEO, Cell C; Karel Pienaar, Group Chief Strategy Officer, MTN SA; and Shameel Joosub, CEO, Vodacom
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Interview:Alan Knott-Craig How do you assess the price and quality of mobile relative to other markets? ALAN KNOTT-CRAIG: If one looks at the operators’ margins on voice and the contributions voice makes to overall revenue, it is clear that tariffs are proportionately high. One year ago, South Africa was ranked 98th in the world in terms of voice tariffs. Things are steadily improving, with tariffs down 34% on average driven by aggressive competition for market share in recent years. Prices…

Analysis

Mobile internet on the rise: Increasingly affordable mobile data is connecting more and more of the country
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While voice revenues grew in 2012 as operators successfully released attractive packages onto the market, high levels of penetration and limited scope to cut prices further have meant that data services are an increasingly important field of competition in the telecoms sector. Data growth has been impressive in recent years, albeit from a low base, and operators are already gearing up for the next phase, which will be the introduction of long-term evolution (LTE) networks offering high-speed mobile…

Analysis

A broadening spectrum: Moves made to increase efficiencies, including a new draft bill
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As is the case in many markets elsewhere, allocation of spectrum in South Africa is controlled and regulated by the government, and heavily demanded by a variety of end-users, including mobile operators, television broadcasters and emergency services. Spectrum scarcity is not a uniquely South African challenge, as the uptake and usage of bandwidth-heavy smart devices is surging globally, increasing data traffic while placing a major stress on mobile networks. However, South African telecoms operators…

Analysis

Government potential: State shows commitment to increasing its spend on technology
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According to the Department of Trade and Industry, South Africa has the largest IT market in Africa, ranking 20th in the world and eighth when IT spending is factored in as a part of GDP. While this bodes well for IT vendors and service providers, many attribute the high ranking to strong levels of IT spend among the corporate segment and assert that the sector could perform even stronger and increase attractiveness if the state resolved a number of issues impeding IT adoption and delaying its procurement…