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How small and medium businesses buy high-tech

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Small and medium enterprises are seen as a gold mine for technology vendors, but there is a secret to how they buy high-tech, writes ARTHUR GOLDSTUCK.

There are more than 650 000 small and medium enterprises (SMEs) in South Africa, making the sector a major target market for vendors of almost any type of product aimed at other businesses. High-tech products, solutions and services rank high among these, with SMEs seen as a gold mine for those who can crack the code of how to sell to them.

The problem is that there isn’t really a code, but one very simple secret: SMEs will only buy high-tech solutions when they’ve become a “no-brainer”.

That attitude goes hand in hand with what is to some an unpalatable reality about SMEs: they are notoriously slow at adopting new technologies.

However, that does not mean there is no hope in selling to them. 

SME Survey 2018, a research project conducted by World Wide Worx in partnership with Intuit QuickBooks, showed there is one clear exception: the Internet of Things (IoT). Interviews with 1400 SMEs revealed that 83% of decision-makers expect to be using IoT in their business within five years.

The reason for this enthusiasm? Many of them have been using IoT all along, in particular with fleet- and vehicle-tracking systems, and asset management. The SIM cards hidden in vehicles to allow them to be tracked are in fact part of IoT. They act as sensors that report vehicle positions to base stations, and that information can be aggregated and supplied to live mapping services. In fact, it is just that technology that makes Google Maps so effective for navigation.

However, when it comes to more futuristic technologies, SME enthusiasm vanishes. The next highest-ranked high-tech options were artificial intelligence and Big Data, but they are expected to be adopted by only 29% and 27% of SMEs respectively.  Just 21% of SMEs expect to use 3D printing, while crowdsourcing drops to 16% of respondents. 

Right at the bottom of the list came Bitcoin, the technology underlying Bitcoin, at 9%, and Virtual Reality, at a mere 8%.

The reason is simple: Blockchain is so new, its value proposition remains a mystery to SMEs. Not only that, but it is strongly linked in the public mind with Bitcoin. The massive fluctuations in the value of the cryptocurrency makes it too volatile and risky for the cautious SME decision-maker.

While virtual reality doesn’t suffer the same bad press, it is still regarded as a toy, and falls far short of the no-brainer status SMEs require of technology.

Even the technologies that fare a little better, like artificial intelligence, are still far off the mark for SMEs. Because they require large amounts of data, which are typically generated by large customer bases, they tend to make sense only to large organisations. Further, it requires a new way of thinking, and adoption requires a mindset change, something that is not even on the radar for most SMEs.

The annual SME Survey has shown again and again over the years that decision-makers are generally only willing to embrace a new technology if there is a clear business case.  So, for example, when the massive technology shift from dial-up to ADSL happened between 2003 and 2009, it was not because SMEs were attracted by higher speeds. Rather, it was a combination of speed, cost-effectiveness, efficiency and the ability to connect multiple users to the same connection, at a lower price. In short, it was a no-brainer.

Now, we are witnessing the beginning of the decline of ADSL, for the very same reason. High-tech history is repeating itself as ADSL is replaced by fibre to the home or office. 

ADSL usage peaked at 73% of SMEs in 2009 and remained at this high until 2015, when fibre arrived. SME Survey 2018 indicates that ADSL usage has now dropped to 59% among SMEs, while fibre has increased to 25% – meaning adoption of fibre is taking place even more rapidly than ADSL did 15 years ago.

This is partly due to the rapid rise in availability of fibre across urban areas, coupled with the falling price of the technology. In conjunction with this, the increasing uptake and use of bandwidth-intensive technologies by SMEs has resulted in a perfect storm that is driving a need for technology replacement. In other words, it’s a no-brainer.

When SMEs see such a clear value proposition, they are ready to embrace it rapidly. On the other hand, when it has to be explained or demystified – as originally occurred with the concept of cloud computing – they tend to stay clear of it for far longer. However, the fibre value proposition is so obvious, that SMEs are clear about how it will improve their business, and so adoption is taking off.

A key benefit SMEs obtain from switching to fibre is that it enables SMEs to operate online without the performance and quality constraints they faced before. This means that their communications are significantly improved for  solutions like video-conferencing and social media. It also gives them more confidence in transacting online, thanks to the quality and speed of the connectivity.

Those selling gadgets and other high-tech will probably take courage from one particularly startling finding in SME Survey 2018: that 70% of SMEs are ready to embrace new technologies.

However, it is clear that, while the willingness is there, they will only embrace something new if it makes sense for their business. In other words, just because SMEs say they are ready to embrace new technology, it doesn’t mean that they will buy just any new technology.

  • Arthur Goldstuck is founder of World Wide Worx and editor-in-chief of Gadget.co.za. Follow him on Twitter on @art2gee and on YouTube

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Samsung S10 in lock-step with its rivals?

Tonight Samsung will kick off the next round in the smartphone wars with the S10 range, writes ARTHUR GOLDSTUCK.

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When Samsung unveils the new S10 smartphone at an event in San Francisco today, it will mark the beginning of the 2019 round of World War S. That stands for smartphone wars, although Samsung would like it to be all about the S.

Ever since the launch of the Samsung Galaxy S4 in 2013, Samsung has held both technology and thought leadership in the handset world. Back then, Apple’s iPhone 5 was the last device from the American manufacturer that could lay claim to being the best smartphone in the world. With the 2013 launch of the iPhone 5s, Apple entered an era of incremental improvement, playing catch-up, and succumbing to market trends driven by its competitors.

Six years later, Samsung is fighting off the same threat. Its Chinese rival, Huawei, suddenly wrested away leadership in the past year, with the P20 Pro and Mate 20 Pro regarded as at last equal to the Samsung Galaxy S9 Plus and Galaxy Note 9 – if not superior. Certainly, from a cost perspective, Huawei took the lead with its more competitive prices, and therefore more value for money.

Huawei also succeeded where Apple failed: introducing more economical versions of its flagship phones. The iPhone 5c, SE and XR have all been disappointments in the sales department, mainly because the price difference was not massive enough to attract lower-income users. In contrast, the Lite editions of the Huawei P9, P10 and P20 have been huge successes, especially in South Africa.

Today, for the first time in half a decade, Samsung goes into battle on a field laid out by its competitors. It is expected to launch the Galaxy S10 Plus, S10 and S10 e, with the latter being the Samsung answer to the strategy of the iPhone XR and Huawei P20 Lite.

Does this mean Samsung is now in lock-step with its rivals, focused on matching their strategies rather than running ahead of them?

It may seem that way, but Samsung has a few tricks up its electronic sleeve. For example, it is possible it will use the S10 launch to announce its coming range of foldable phones, expected to be called the Galaxy X, Galaxy F, Galaxy Fold or Galaxy Flex. It previewed the technology at a developer conference in San Francisco last November, and this will be the ideal moment to reclaim technology leadership by going into production with foldables – even if the S10 range itself does not shoot out the lights.

However, the S10 handsets will look very different to their predecessors. First, before switching on the phone, they will be notable by the introduction of what is being called the punch-hole display, which breaks away from the current trend of having a notch at the top of the phone to house front-facing cameras and speakers. Instead, the punch-hole is a single round cut-out that will contain the front camera. It is the key element of Samsung’s “Infinity O” display – the O represents the punchhole – which will be the first truly edge-to-edge display, on the sides and top.

The S10 range will use the new Samsung user interface, One UI, also unveiled at the developer conference. It replaces the previous “skin”, unimaginatively called the Samsung Experience, to introduce a strong new interface brand.

One UI went live on the Note 8 last month, giving us a foretaste, and giving Samsung a chance to iron out the bugs in the field. It is a less cluttered interface, addressing one of the biggest complaints about most manufacturer skins. Only Nokia and Google Pixel handsets offer pure Android in the local market, but One UI is Samsung’s best compromise yet.

It introduces a new interaction area, in the bottom half, reachable with the thumb, with a viewing area at the top, allowing the user to work one-handed on the bottom area while still having apps or related content visible above. One UI also improves gesture navigation – the phone picks up hand movements without being touched – and notification management.

The S10 range will be the first phones to feature the latest Qualcomm Snapdragon 855 chip, at least for the South African and American markets. That makes it 5G compatible, for when this next generation of mobile broadband becomes available in these markets.

They will also be the first phones to feature Wi-Fi 6, the next generation of the Wi-Fi mobile wireless standard. It will perform better in congested areas, and data transfer will be up to 40% faster than the previous generation.

The phones will be the first to use ultrasound for fingerprint detection. If Samsung gets it right, this will make it the fastest in-screen fingerprint sensor on the market, and allows for a little leeway if one pushes the finger down slightly outside the fingerprint reader surface. It does mean, however, that screen protectors will have to be redesigned to avoid blocking the detection.

Not enough firsts? There are a few more.

Most notably, it will be the first phone range to feature 1 Terabyte (TB) storage – that’s a thousand Gigabytes (GB) – at least for the top-of-the-range devices. Samsung last month announced that it would be the first manufacturer to make 1TB built-in onboard flash storage. Today, it will deploy this massive advantage as it once again weaponises its technology in the fight for smartphone domination.

  • Arthur Goldstuck is founder of World Wide Worx and editor-in-chief of Gadget.co.za. Follow him on Twitter and Instagram on @art2gee

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IoT set to improve authentication

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By Sherry Zameer, Senior Vice President, Internet of Things Solutions for CISMEA region at Gemalto

As it rapidly approaches maturity, the Internet of Things (IoT) is set to continue a transformational trajectory, introducing new efficiencies in multiple fields by allowing measurement and analysis on a scale that has never been possible before. From agriculture to logistics, from retail to hospitality, from traffic to health, from the home to the office, the applications for monitoring ”things” are limited only by the imagination.

And South African (and African) businesses are showing abundant imagination in their practical deployments of IoT solutions in multiple settings, creating a better tomorrow through almost universal measurement and the introduction of new levels of convenience – including how to access locations, devices and services securely.

Any company, whether South African or international, should bear in mind that understanding consumer expectations can be the key to unlocking the full potential of IoT devices and related smart services.

According to Gemalto’s latest Connected Living study, improving the way consumers authenticate themselves to services is one of the most anticipated benefits of IoT, highlighting a desire for a more seamless and secure IoT experience.

Consumers are interested in advanced ways of authenticating themselves through automatic (based on behavioral patterns) or biometric techniques, lessening the need to have to intervene manually, all in the name of a much more streamlined authentication process. Smartphone manufacturers like Apple and Samsung have already placed fingerprint and facial recognition high on the agenda. There is also a widespread positive sentiment towards IoT’s potential for improving the quality of home life through connected, smart appliances.

Personalised services is something else that wins consumers over. In fact, a fluid, personalised and unified experience with continuity of services, together with security and privacy, is critical for the successful implementation of any technology.

And those types of services are today quite possible. With everything being connected – from small gadgets to digital solutions for large enterprises – IoT is no longer just a buzzword. That much is clear in a piece from Vodacom IoT managing executive Deon Liebenberg. Writing for IOL Online, Liebenberg provides insight into the sheer range of applications for IoT: the 20 use cases he cites range from the obvious, like transport and logistics, to the connected home and wearables; he even suggests tagging pets with IoT transmitters, for those who always need to know the whereabouts of the family cat.

Low-cost tags fitted to cats, dogs, lamp posts, shipping containers or other items are just one part of the puzzle, however. There are other two pieces; arguably the most complex part is the availability of communication networks in areas where there aren’t any WiFi networks, or indeed, anything else.

And that’s where the bigger takeaway from Liebenberg’s piece and other IoT trends articles becomes apparent. The communication networks are there, as are those tags: dedicated IoT networks (like LoraWAN, SigFox and narrowband IoT) are all available in South Africa.

So, too, is the third and final essential component. Software which is able to process the data generated by the tag and transmitted over the IoT network and into the internet. In this regard, there’s no shortage of solutions available from cloud providers like AWS and Azure; electronics giant Siemens, too, is in on the action, having recently launched a new cloud-based IoT operating system to develop applications and services for process industries, including oil and gas and water management.

This combination means it is quite possible right now to enable just about any use case. Business owners, who will know best how IoT can add value in their organisation, can now see their ideas becoming reality. Most crucial of all, IoT solutions delivering new levels of efficiency and convenience are not only possible, they are able to be offered with the simple and effective security that will drive consumer acceptance.

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