The priority for the telecoms industry this year is to accelerate deployment of true broadband services, says SUVEER RAMDHANI, CDO at SEACOM.
The telecoms industry in South Africa and the rest of the continent is on the cusp of a fibre and mobile broadband boom, as network operators scramble to meet the demand for video, cloud applications and mobile solutions among consumers and businesses.
That’s the word from Suveer Ramdhani, Chief Development Officer at SEACOM, who says that the priority for the telecoms industry this year, should be to accelerate deployment of true broadband services so that African users can benefit from the full power of the Internet.
Says Ramdhani: “In Africa, we have seen some progress in increasing Internet penetration, but the goalposts keep shifting. Many, perhaps even most, Internet connections on the continent are sub-1Mbs connections that do not meet the insatiable demand among businesses and consumers for fast and plentiful bandwidth.”
In Africa, one major factor driving demand for high-performance bandwidth, is a growing and youthful population that sees connectivity as a fundamental right, he adds. For them, broadband spells access to educational, economic and social opportunities. Mobile broadband has an important role to play, but fibre-based fixed-line infrastructure is also vitally important in connecting mobile towers and giving users affordable last-mile access to high-speed services.
“Research from We Are Social indicates that 75% of web pages served to web browsers in South Africa are accessed from mobile devices,” says Ramdhani. “Across Africa, people spend most of their time online using mobile devices because of the world’s shift towards mobility and because it is the only affordable or available means of connecting to the Internet in many regions.”
However, the way that people use the Internet on a mobile device is different to how they use their fixed-line connections. They use their smartphones for social networking, messaging, entertainment and utility, while desktop users do more data-intensive tasks such as file sharing and video streaming.
Another factor is the rapid rise of video. Data from Cisco shows that video accounted for nearly 58% of data consumption in South Africa in 2015, which is expected to rise to 71% by 2020. Streaming video services such as Netflix and ShowMax will be a major reason for this growth, Ramdhani says.
In the business market, there is growing demand for cloud computing services such as those provided by Amazon, Microsoft, Google, Salesforce.com and a range of African service providers, he adds. Many African organisations are embracing the cloud to fast-track modernisation of their IT infrastructures.
“With the trends towards higher video consumption and cloud computing, users will need to find their way back to a fixed-line connection,” says Ramdhani. “Mobile operators will need to look at their business models and decide whether they will evolve these models to capture all of our data spend or whether they will continue to provide relatively expensive services for niche mobile use.”
Ecosystem comes together
Ramdhani says that many elements of the ecosystem have come together in Africa for a boom in high-speed Internet access. For example, an explosion in local data centres and the deployment of on-continent content caches has brought global content closer to the end-user, improving their experience dramatically.
In addition, open-access infrastructure players have reduced barriers to entry for innovative service providers, meaning that fibre to the business and home is becoming increasingly viable in African metropolitan regions. “There is fibre from city-to-city and fibre in rings around the cities, but not enough to businesses’ and consumers’ doorsteps,” says Ramdhani. “Changing this is a priority for SEACOM this year.”
SEACOM is also focusing on connecting into more countries as backhaul becomes economically viable and expanding its ring around Africa with aspirations to the West. “With such low broadband penetrations and with such high demand for data volumes, the growth possibilities are tremendous,” says Ramdhani.
Gadget goes to Hollywood
Gadget visited the Netflix studios last week. In the first of a series, ARTHUR GOLDSTUCK talks to CEO Reed Hastings.
Netflix CEO Reed Hastings is no stranger to Africa. He has travelled throughout South Africa, taught maths in Swaziland for two years with the Peace Corps, and visits close family in Maputo. As a result, he is keenly aware of the South African entertainment and connectivity landscape.
In an exclusive interview at the Netflix studios in Hollywood, Los Angeles, last week, he revealed that Netflix had no intentions of challenging MultiChoice’s dominance of live sports broadcasting on the continent.
“Other firms will do sport and news; we are trying to focus on movies and TV shows,” he said. “There are a lot of areas that are video that we are not doing: sports, news, video gaming, user-generated content. We don’t have live sport.
“We’re not replacing MultiChoice at all. Their subscriber growth is steady in South Africa. They serve a need that’s independent of the Internet, via low-price satellite. There is no intention of capturing that audience. If they’re growing, it’s because they serve a need.”
While Reed ruled out any collaboration with MultiChoice on its satellite delivery platform, despite its collaboration with another pay-TV service, Sky TV in the United Kingdom, he did not close the door. He stressed that Netflix saw itself as an Internet-based service, and would pursue the opportunities offered by evolving broadband in Africa.
“If you look in other markets like the USA, how Comcast carries us on set-top boxes with their other services, it could happen with MultiChoice, the same as with all the pay-TV providers.
“We’re really focused on being a service over the Internet and not over satellite. Our service doesn’t work on satellite. Where we work with Sky is on Internet-connected devices. We’re happy to work on Internet-connected devices. We tend to work on smart TVs, but need broadband Internet for that.
“Broadband is getting faster in Nigeria, Tanzania, Kenya and South Africa – we can see the positive trendlines – so it’s more likely we will work with broadband Internet companies.”
Hastings is a firm believer in the idea that one content provider’s success does not depend on pushing another down.
“HBO has grown at the same time as we have, so can see our success doesn’t determine their success. What matters is amazing content with which the world falls in love.”
Click here to read on about Hastings’ views on international expansion, and how the streaming service selects content for its platform.
Take these 5 steps to digital
By MARK WALKER, Associate Vice President for Sub-Saharan Africa at IDC Middle East, Africa and Turkey.
Digital transformation isn’t a buzz word because it sounds nice and looks good on the business CV. It is fundamental to long-term business success. IDC anticipates that 75% of enterprises will be on the path to digital transformation by 2027.
However, digital transformation is not a process that ticks a box and moves to the next item on the agenda – it is defined by the organisation’s shift towards a digitally empowered infrastructure and employee. It is an evolution across system, infrastructure, process, individual and leadership and should follow clear pathways to ensure sustainable success.
The nature of the enterprise has changed completely with the influence of digital, cloud and the Fourth Industrial Revolution (4IR), and success is reliant on strategic change.
There is a lot more ownership and transparency throughout the organisation and there is a responsibility that comes with that – employees want access to information, there has to be speed in knowledge, transactions and engagement. To ensure that the organisation evolves alongside digital and demand, it has to follow five very clear pathways to long-term, achievable success.
The first of these is to evaluate where the enterprise sits right now in terms of its digital journey. This will differ by organisation size and industry, as well as its reliance on technology. A smaller organisation that only needs a basic accounting function or the internet for email will have far different considerations to a small organisation that requires high-end technology to manage hedge funds or drive cloud solutions. The same comparisons apply to the enterprise-level organisation. The mining sector will have a completely different sub-set of technology requirements and infrastructure limitations to the retail or finance sectors.
Ultimately, every organisation, regardless of size or industry, is reliant on technology to grow or deliver customer service, but their digital transformation requirements are different. To ensure that investment into artificial intelligence (AI), machine learning, knowledge engines, automation and connectivity are accurately placed within the business and know exactly where the business is going.
The second step is to examine what the business wants to achieve. Again, the goals of the organisation over the long and short term will be entirely sector dependent, but it is essential that it examine what the competitive environment looks like and what influences customer expectations. This understanding will allow for the business to hone its digital requirements accordingly.
The third step is to match expectations to reality. You need to see how you can move your digital transformation strategy forward and what areas require prioritisation, what funding models will support your digital aspirations, and how this tie into what the market wants. Ultimately, every step of the process has to be prioritised to ensure
The fourth step is to look at the operational side of the process. This is as critical as any other aspect of the transformation strategy as it maps budget to skills to infrastructure in such a way as to ensure that any project delivers return on investment. Budget and funding are always top of mind when it comes to digital transformation – these are understandably key issues for the business. How will it benefit from the investment? How will it influence the customer experience? What impact will this have on the ongoing bottom line? These questions tie neatly into the fifth step in the process – the feedback loop.
This is often the forgotten step, but it is the most important. The feedback loop is critical to ensuring that the digital transformation process is achieving the right results, that the right metrics are in place, and that the needle is moving in the right direction. It is within this feedback loop that the organisation can consistently refine the process to ensure that it moves to each successive step with the right metrics in place.
There is also one final element that every organisation should have in place throughout its digital evolution. An element that many overlook – engagement. There must be a real desire to change, from the top of the organisation right down to the bottom, and an understanding of what it means to undertake this change and why it is essential. This is why this will be a key discussion at the 2019 IDC South Africa CIO Summit taking place in April this year. With this in place, the five steps to digital transformation will make sense and deliver the right results.