The fibre-to-the-home revolution that has swept suburban South Africa is about to arrive in the country’s townships, writes ARTHUR GOLDSTUCK.
Fibre-to-the-home is this decade’s magic ingredient for high-speed, painless and unlimited Internet access. But, until now, it has been the province of the privileged. Only the more affluent suburbs of South Africa’s cities have been afforded the luxury of the dedicated optical fibre cables that typically run in trenches along leafy sidewalks.
That is about to change.
Vumatel, the company that sparked the FTTH revolution when it won a contract to supply fibre to the suburb of Parkhurst, is at it again. This time, it plans to connect the townships of South Africa. It has come up with a low-cost alternative to wiring dense suburbs, and intends to offer uncapped high-speed broadband for a mere R89 a month.
To put that in context, the average spend on a cellphone in lower socio-economic segments is typically around R100. Fibre, coupled with in-home Wi-Fi, can replace a large chunk of cellular spend by moving voice traffic from the mobile networks to voice over WhatsApp and Facebook Messenger, among other. All data use in the home would move off the expensive data services provided by the mobile operators.
With wide-scale roll-out, this could prove immensely damaging to the operators. More significantly and to the point, however, it could prove immensely beneficial to those who have previously been kept away from the largesse of high-speed, unlimited access.
The Vumatel service will offer a 100Mbps download and 10Mbps upload speed, which typically costs more than a R1000 a month in more affluent suburbs. How is it possible, then, to offer it at a mere R89 a month?
Only with a great deal of commitment to finding an affordable broadband solution for the mass-market.
“We think that the FTTH deployments as we and other operators are doing them are great for the country, because we are moving connectivity forward at a macro level,” says Vumatel CEO Niel Schoeman. “But it is clearly not addressing the information divide between the less fortunate and the leafy suburbs, and potentially exacerbates inequality in terms of information access.
“We’ve been trying to come up with a solution to address townships, to provide that abundance of information to residents of townships. We think we can do it by providing it at R89 a month for a 100Mbps uncapped service. We think that is fundamentally different to a 500MB data allocation on a prepaid service, which has been the only kind of option for connectivity.”
Vumatel will initially roll out the service in the Johannesburg township of Alexandra, with an estimated 400 000 residents in the target area.
“That is our township equivalent of the announcement that we were connecting Parkhurst. We’re going to give it a go between now and March.”
The question remains: how is such low cost possible on a business level?
On the surface, the answer lies in Vumatel’s October 2016 acquisition of Fibrehoods, a provider of aerial fibre similar to overhead telephone lines. However, that in itself would not cut the costs so radically. Until recently, Fibrehoods had also been serving wealthier suburbs.
“Clearly, to make that price point work, we need to work hard at the capital cost of deployment,” says Schoeman. “The topography of townships doesn’t lend itself to the typical buried, trenched solution, so we’ll use aerial fibre.
“The price is possible thanks to a combination of technologies , the potential number of customers per square kilometre, and the fact that it will also be potentially contended up to 20 times, meaning 20 customers will use the same 100Mbps line. So each customer is always guaranteed 5Mbps upward, but the probability of getting more like a 20Mbps service is high. Not everyone will be using the same line at the same time.”
Vumatel will also use its fibre to provide Wi-Fi in public spaces in the townships. This service will be possible, partly, thanks to corporate social investment from its 49% shareholder, Investec.
“We’ve looked at a broader Wi-Fi deployment model, but we don’t think it creates the abundance that closes the digital gap,” says Schoeman. “You can use the analogy of water: Wi-Fi hotspots create wells where people can collect water whereas, if you provide piped water to homes, you see people growing gardens and using it in an unlimited way. We want to go deep into every home, uncapped, at high speed, and see if we can make a difference.”
Unlike the suburban model, where Vumatel lays down the fibre and leaves it to Internet Service Providers to deliver access, it will initially provide access itself. It will piggyback on the Dark Fibre Africa grid that will link it to the broader Internet and undersea cables, but will acquire and distribute access and data services itself.
“We first want to see if we can make the model work rather than having to add additional margins for service providers. Our philosophy is always open access so, if it works, we will see if we can let service providers offere innovative services.”
Schoeman believes the eventual fibre market for all service providers will be as much as 35-million. He says it will be possible for Vumatel to bring fibre within reach of another 10-million people in the next couple of years, at a cost of between R2-billion and R3-billion.
“We want to see if we can kick off another catalyst event like Parkhurst, and start a storm: to see if we bring abundant connectivity to low income homes.”
IoT at starting gate
South Africa is already past the Internet of Things (IoT) hype cycle and well into the mainstream, writes MARK WALKER, associate vice president of Sub-Saharan Africa at International Data Corporation (IDC).
Projects and pilots are already becoming a commercial reality, tying neatly into the 2017 IDC prediction that 2018 would be the year when the local market took IoT mainstream. Over the next 12-18 months, it is anticipated that IoT implementations will continue to rise in both scope and popularity. Already 23% are in full deployment with 39% in the pilot phase. The value of IoT has been systematically proven and yet its reputation remains tenuous – more than 5% of companies are reluctant to put their money where the trend is – thanks to the shifting sands of IoT perception and success rate.
There are several reasons behind why IoT implementations are failing. The biggest is that organisations don’t know where to start. They know that IoT is something they can harness today and that it can be used to shift outdated modalities and operations. They are aware of the benefits and the case studies. What they don’t know is how to apply this knowledge to their own journey so their IoT story isn’t one of overbearing complexity and rising costs.
Another stumbling block is perception. Yes, there is the futuristic potential with the talking fridge and intelligent desk, but this is not where the real value lies. Organisations are overlooking the challenges that can be solved by realistic IoT, the banal and the boring solutions that leverage systems to deliver on business priorities. IoT’s potential sits within its ability to get the best out of assets and production efficiencies, solving problems in automation, security, and environment.
In addition to this, there is a lack of clarity around return on investment, uncertainty around the benefits, a lack of executive leadership, and concerns around security and the complexities of regulation. Because IoT is an emerging technology there remains a limited awareness of the true extent of its value proposition and yet 66% of organisations are confident that this value exists.
This percentage poses both a problem and opportunity. On one hand, it showcases the local shift in thinking towards IoT as a technology worth investing into. On the other hand, many companies are seeing the competition invest and leaping blindly in the wrong direction. Stop. IoT is not the same for every business.
It is essential that every company makes its own case for IoT based on its needs and outcomes. Does agriculture have the same challenges as mining? Does one mining company have the same challenges as another? The answer is no. Organisations that want their IoT investment to succeed must reject the idea that they can pick up where another has left off. IoT must be relevant to the business outcome that it needs to achieve. While some use cases may apply to most industries based on specific circumstances, there are different realities and priorities that will demand a different approach and starting point.
Ask – what is the business problem right now and how can technology be leveraged to resolve it?
In the agriculture space, there is a need to improve crop yields and livestock management, improve farm productivity and implement environmental monitoring. In the construction and mining industry, safety and emergency response are a priority alongside workforce and production management. Education shifts the lens towards improving delivery and quality of education, access to advanced learning methods and reducing the costs of learning. Smart cities want to improve traffic and efficiently deliver public services and healthcare is focusing on wellness, reducing hospital admissions and the security of assets and inventory management.
The technology and solutions selected must speak to these specific challenges.
If there are no insights used to create an IoT solution, it’s the equivalent of having the fastest Ferrari on Rivonia Road in peak traffic. It makes a fantastic noise, but it isn’t going to move any faster than the broken-down sedan in the next lane. Everyone will be impressed with the Ferrari, but the amount of power and the size of the investment mean nothing. It’s in the wrong place.
What differentiates the IoT successes is how a company leverages data to deliver meaningful value-added predictions and actions for personalised efficiencies, convenience, and improved industry processes. To move forward the organisation needs to focus on the business outcomes and not just the technology. They need to localise and adapt by applying context to the problem that’s being solved and explore innovation through partnerships and experimentation.
ERP underpins food tracking
The food traceability market is expected to reach almost $20 billion by 2022 as increased consumer awareness, strict governance requirements, and advances in technology are resulting in growing standardisation of the segment, says STUART SCANLON, managing director of epic ERP
Just like any data-driven environment, one of the biggest enablers of this is integrated enterprise resource planning (ERP) solutions.
As the name suggests, traceability is the ability to track something through all stages of production, processing, and distribution. When it comes to the food industry, traceability must also enable stakeholders to identify the source of all food inputs that can include anything from raw materials, additives, ingredients, and packaging.
Considering the wealth of data that all these facets generate, it is hardly surprising that systems and processes need to be put in place to manage, analyse, and provide actionable insights. With traceability enabling corrective measures to be taken (think product recalls), having an efficient system is often the difference between life or death when it comes to public health risks.
Sceptics argue that traceability simply requires an extensive data warehouse to be done correctly, the reality is quite different. Yes, there are standard data records to be managed, but the real value lies in how all these components are tied together.
ERP provides the digital glue to enable this. With each stakeholder audience requiring different aspects of traceability (and compliance), it is essential for the producer, distributor, and every other organisation in the supply chain, to manage this effectively in a standardised manner.
With so many different companies involved in the food cycle, many using their own, proprietary systems, just consider the complexity of trying to manage traceability. Organisations must not only contend with local challenges, but global ones as well as the import and export of food are big business drivers.
So, even though traceability is vital to keep track of everything in this complex cycle, it is also imperative to monitor the ingredients and factories where items are produced. Having expansive solutions that must track the entire process from ‘cradle to grave’ is an imperative. Not only is this vital from a safety perspective, but from cost and reputational management aspects as well. Just think of the recent listeriosis issue in South Africa and the impact it has had on all parties in that supply chain.
Thanks to the increasing digital transformation efforts by companies in the food industry, traceability becomes a more effective process. It is no longer a case of using on-premise solutions that can be compromised but having hosted ones that provide more effective fail-safes.
In a market segment that requires strict compliance and regulatory requirements to be met, cloud-based solutions can provide everyone in the supply chain with a more secure (and tamper-resistant) solution than many of the legacy approaches of old.
This is not to say ERP requires the one or the other. Instead, there needs to be a transition provided between the two scenarios that empowers those in the food supply chain to maximise the insights (and benefits) derived from traceability.
Now, more than ever, traceability is a business priority. Having the correct foundation through effective ERP is essential if a business can manage its growth and meet legislative requirements into the future.