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Broadband can drive economies across Africa

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Africa’s legacy broadband infrastructure offers the continent the opportunity to leapfrog technology. FARHAD KHAN of Yahsat believes there is an opportunity for the continent to broadly become an early and easy adopter of new technologies.

As Africa’s economies continue to grow, more of the continent’s residents have been provided with a higher standard of living and additionally possess increased disposable income. The direct correlation between investment in broadband connectivity and the growth in economic activity has been well established, with research from the GSM Association amongst others, suggesting that for every 10 per cent increase in broadband connectivity, the GDP of developing nations rises by 1.38 per cent.  So, the impact of a 30 per cent rise in broadband connectivity across Africa in the coming decade would have a major positive economic benefit.

Africa’s relatively porous, legacy broadband infrastructure offers the continent the opportunity to leapfrog technology and roll out cutting edge, contemporary networks; given there are relatively few issues regarding network integration and regulatory red tape.  Therefore, there is a real opportunity for the continent to broadly become an early – and easy – adopter of new technologies.

The broadband revolution is already well underway across Africa, and there is no shortage of focus on providing the continent with affordable, reliable and  stable broadband connectivity. Take for example the vision of Internet.org and the innovative ideas to provide connectivity and access.  Some of these innovations include:

  • Facebook’s plans for Wi-Fi delivered by drones
  • Elon Musk’s SpaceX adopting reusable launchers to reduce the capital cost of providing broadband via satellite
  • The potential of Li-Fi to deliver high capacity, low power connectivity

One of the exciting perspectives to the broadband story for Africa is that real gains can be made now, today. Yahsat is in the unique position to be able to deliver stable, high powered, affordable broadband connectivity to our footprint immediately. We are in a unique and advantageous position to deploy our fleet of Ka-band satellites, utilising our capacity and spot beams to optimise the broadband pipe, to where it is needed most – efficiently and reliably. Next year our coverage area will widen even further with the launch of our third satellite, giving Yahsat the potential to reach 60 per cent of Africa’s population across 28 countries.

The advantages of satellite communications services are numerous and significant – offering stable, affordable broadband connectivity that, in turn, has the ability to change the fortunes of a nation – and its people, for the better. The provision of improved education, better healthcare, stronger, sustainable economic growth, and social development are all potential benefits that can be reaped by investing in the appropriate broadband technology.

We are already seeing first-hand the benefits that satellite technology is bringing to communities and individuals in Africa. Take the example of Eastern Cape in South Africa, a region that covers 65,000 square miles. Outside of the major cities, the province is diverse in terms of landscape, and home to many rural communities. These remote communities rely on local resources to stay informed and educated, with community libraries playing a key role. Traditionally these libraries have been underserved in terms of connectivity, meaning library-to-library communications and public internet access have been unreliable.  With our satellite broadband service, YahClick, and service partner Vox Telecom, we joined forces with The National Library to provide satellite broadband internet services to 207 public libraries in the Eastern Cape, covering a population of over 6 million. Communities across the Eastern Cape now have easier access to information and knowledge, enhancing the lives of millions of people.

When it comes to public services, they are easily accessible in urban areas; however, their availability across remote communities remains rather low. Home to one of the world’s largest national pension funds, South Africa has over 1.2 million people needing access to funds to be able to subsist during their retirement. Surprisingly, an estimated 10% of its eligible citizens are unaware of or unable to access these funds. Hence, there was a need to provide always-on broadband connectivity to allow real-time access to people’s pension. Again, with Vox Telecom, we worked with the South Africa Government Employees Pensions Fund to provide a solution through our YahClick Go service. Government pensions fund field service employees were able to mobilise their services in vans, with real-time access to the government pension system. Unhindered by the likes of mountains and inclement weather, they enabled access in the remotest areas, and today, all 1.2 million members of the GEPF and their beneficiaries can now gain access to valuable financial services thanks to satellite broadband connectivity.

The applications are endless for schools, medical centres, commerce/banking, as well as for connecting under serviced, off-network areas such as rural communities. Last September, under the auspices of the United Nations, countries adopted a set of goals to end poverty, protect the planet, and ensure prosperity for all as part of a sustainable development agenda. Each goal has specific targets to be achieved over the next 15 years, and we believe broadband connectivity plays an instrumental role in the achievement of these ambitions, to the benefit of all, including the People of Africa.

* Farhad Khan, Chief Commercial Officer, Yahsat 

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Online retail gets real

After decades of experience in selling online, retailers still seek out the secret of reaching the digital consumer, writes ARTHUR GOLDSTUCK.

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It’s been 23 years since the first pizza and the first bunch of flowers was sold online. One would think, after all this time, that retailers would know exactly what works, and exactly how the digital consumer thinks.

Yet, in shopping-mad South Africa, only 4% of adults regularly shop online. One could blame high data costs, low levels of tech-savviness, or lack of trust. However, that doesn’t explain why a population where more than a quarter of people have a debit or credit card and almost 40% of people use the Internet is staying away.

The new Online Retail in South Africa 2019 study, conducted by World Wide Worx with the support of Visa and Platinum Seed, reveals that growth is in fact healthy, but is still coming off a low base. This year, the total sale of retail products online is expected to pass the R14-billion mark, making up 1.4% of total retail.

This figure represents 25% growth over 2017, and comes after the same rate of growth was seen in 2017. At this rate, it is clear that online retail is going mainstream, driven by aggressive marketing, and new shopping channels like mobile shopping. 

But it is equally clear that not all retailers are getting it right. According to the study, the unwillingness of business to reinvest revenue in developing their online presence is one of the main barriers to long-term success. Only one in five companies surveyed invested more than 20% of their online turnover back into their online store. Over half invested less than 10% back.

On the surface, the industry looks healthy, as a surprisingly high 71% of online retailers surveyed say they are profitable. But this brings to mind the early days of Amazon.com, in 1996, when founder Jeff Bezos was asked when it would become profitable.

He declared that it would not be profitable for at least another five years. And if it did, he said, it would be in big trouble. He meant that it was so important for long-term sustainability that Amazon reinvest all its revenues in customer systems, that it could not afford to look for short-term profits.

According to the South African study, the single most critical factor in the success of online retail activities is customer service. A vast majority, 98% of respondents, regarded it as important. This positions customer service as the very heart of online retail. For Amazon, investment back into systems that would streamline customer service became the key to the world’s digital wallets.

In South Africa online still make up a small proportion of overall retail, but for the first time we see the promise of a broader range of businesses in terms of category, size, turnover and employee numbers. This is a sign that our local market is beginning to mature. 

Clothing and apparel is the fastest growing sector, but is also the sector with the highest turnover of businesses. It illustrates the dangers of a low barrier to entry: the survival rate of online stores in this sector is probably directly opposite to the ease of setting up an online apparel store.

A fast-growing category that was fairly low on the agenda in the past, alcohol, tobacco and vaping, has benefited from the increased online supply of vapes, juices and accessories. It also suggests that smoking bans, and the change in the legal status of marijuana during the survey, may have boosted demand. 

In the coming weeks, we can expect online retail to fall under the spotlight as never before. Black Friday, a shopping tradition imported “wholesale” from the United States, is expected to become the biggest online shopping day of the year in South Africa, as it is in the USA.

Initially, it was just a gimmick in South Africa, attempting to cash in on what was a purely American tradition of insane sales on the Friday after Thanksgiving Day, which occurs on the third Thursday of November every year. It is followed by Cyber Monday, making the entire weekend one of major promotions and great bargains.

It has grown every year in South Africa since its first introduction about six years ago, and last year it broke into the mainstream, with numerous high profile retailers embracing it, and many consumers experiencing it for the first time. 

It is now positioned as the prime bargain day of the year for consumers, and many wait in anticipation for it, as they do in the USA. Along with Cyber Monday, it provides an excuse for retailers to go all out in their marketing, and for consumers to storm the display shelves or web pages. South African shoppers, clearly, are easily enticed by bargains.

Word of mouth around Black Friday has also grown massively in the past two years, driven by both media and shoppers who have found ridiculous bargains. As news spreads that the most ridiculous of the bargains are to be had online, even those who were reticent of digital shopping will be tempted to convert.

The Online Retail in SA 2019 report has shown over the years that, as people become more experienced in using the Internet, their propensity to shop online increases. This is part of the World Wide Worx model known as the Digital Participation Curve. The key missing factor in the Curve is that most retailers do not know how to convert that propensity into actual online shopping behaviour. Black Friday will be one of the keys to conversion.

Carry on reading to find out about the online retailers of the year.

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Reliable satellite Internet?

MzansiSat, a satellite-Internet business, aims to beam Internet connections to places in South Africa which don’t have access to cabled and mobile network infrastructure, writes BRYAN TURNER.

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Stellenbosch-based MzansiSat promises to provide cheap wholesale Internet to Internet Service Providers for as little as R25 per Gigabyte. Providers who offer more expensive Internet services could benefit greatly from partnering with MzansiSat, says the company. 

“Using MzansiSat, we hope that we can carry over cost-savings benefits to the consumer,” says Victor Stephanopoli, MzansiSat chief operating officer.

The company, which has been spun off from StellSat, has been looking to increase its investor portfolio while it waits for spectrum approval. The additional investment will allow MzansiSat’s satellite to operate in more regions across Africa.

The MzansiSat satellite is being built by Thales Alenia Space, a French company which is also acting as technical partner to MzansiSat. In addition to building the satellite, Thales Alenia Space will also be assisting MzansiSat in coordinating the launch. The company intends to launch the satellite into the 56°E orbital slot in a geostationary orbit, which enables communication almost anywhere in Africa. The launch is expected to happen in 2022. 

The satellite will have 76 transponders, 48 of which will be Ku-band and 28 C-band. Ku-band is all about high-speed performance, while C-band deals with weather-resistance. The design intention is for customers of MzansiSat to choose between very cheap, reliable data and very fast, power-efficient data. 

C-band is an older technology, which makes bandwidth cheaper and almost never affected by rain but requires bigger dishes and slower bandwidth compared to Ku-band connections. On the other hand, Ku-band is faster, experiences less microwave interference, and requires less power to run – but is less reliable with bad weather conditions.

MzansiSat’s potential military applications are significant, due to the nature of the military being mobile and possibly in remote areas without connectivity.  Connectivity everywhere would be potentially be life-saving.

Consumers in remote areas will benefit, even though satellite is higher in latency than fibre and LTE connections. While this level of latency is high (a fifth of a second in theory), satellite connections are still adequate for browsing the Internet and watching online content. 

The Internet of Things (IoT) may see the benefits of satellite Internet before consumers do. The applications of IoT in agriculture are vast, from hydration sensors to soil nutrient testers, and can be realised with an Internet connection which is available in a remote area.

Stephanopoli says that e-learning in remote areas can also benefit from MzansiSat’s presence, as many school resources are becoming readily available online. 

“Through our network, the learning experience can be beamed into classrooms across the country to substitute or complement local resources within the South African schooling system.”

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