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Smart data will dominate mobile SA

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A recent Cisco report has revealed that the worldwide shift from feature phones to smartphones, a revival in laptops with tablet-like capabilities, as well as expanding machine-to-machine applications are key factors supporting the increasing smart traffic trend.

According to the latest annual update of the Cisco Visual Networking Index Global Mobile Data Traffic Forecast for 2014 to 2019, the ongoing adoption of more powerful mobile devices and machine-to-machine (M2M) connections combined with broader access to faster cellular networks are key contributors to significant mobile traffic growth. In 2014, 82% of South African mobile data traffic was “smart” traffic, with advanced computing/multi-media capabilities and a minimum of 3G connectivity, but that figure is expected to rise to 98% by 2019.

The worldwide shift from basic-feature phones to smartphones – combined with the continued growth in tablets, a resurgence in laptops with tablet-like capabilities, as well as expanding machine-to-machine (M2M) applications – are key factors supporting the increasing smart traffic trend.

“The remarkable uptake and adoption of mobile devices will be a key contributor to the country’s transformation, impacting industries like education, healthcare and government services therefore reaching all aspects of the society. The ongoing adoption of more powerful mobile devices and wider deployments of emerging M2M applications, combined with broader access to faster wireless networks is not limited to South Africa but across Africa as a whole. The findings of Cisco’s Mobile VNI 2015 comes as no surprise given the phenomenal growth of mobile traffic. This mobile-friendly environment will give service providers in South Africa a new landscape of challenges and opportunities to innovatively deliver a variety of mobile services and experiences to consumers and business users as the Internet of Everything (IoE) continues to take shape,” says Vernon Thaver, Chief Technology Officer, Cisco Systems South Africa

Key Highlights from South Africa

In South Africa, mobile data traffic is expected to grow 11-fold from 2014 to 2019, a compound annual growth rate (CAGR) of 63% – two times faster than expected fixed IP traffic growth. This will be driven by the projected 48.2 million mobile users (88% of the population) by 2019, up from 43.4 million in 2014.

·         Data explosion: South African mobile data traffic will grow 2 times faster than fixed IP traffic from 2014 to 2019, and will account for 32% of South African fixed and mobile data traffic by 2019, up from 13% in 2014.

·         Smarter connections: In South Africa, 62% of mobile connections will be ‘smart’ connections by 2019, up from 21% in 2014.

·         Smarter traffic: In South Africa, 98% of mobile data traffic will be ‘smart’ traffic by 2019, up from 82% in 2014.

·         More traffic: Mobile traffic per South African user will reach 7,217 megabytes per month by 2019, up from 710 megabytes per month in 2014, a CAGR of 57%.

 

 Key Mobile Data Traffic Drivers in South Africa

From 2014 to 2019, Cisco anticipates that South African mobile traffic will grow at 63% CAGR. Trends driving mobile data traffic growth include:

·         More mobile users: By 2019, there will be 48.2 Million mobile users (up from 43.4 Million in 2014), a CAGR of 2.1%. The number of mobile-connected devices will grow at a compound annual growth rate of 6% from 2014 to 2019. In 2014 there were 43.4 Million mobile users, nearly 82% of South Africa’s population, up 5% from 41.2 Million in 2013.

·         More mobile connections: By 2019, there will be approximately 112 million mobile-connected devices. In 2014, 6.9 million smartphones were added to the mobile network and there were 84 million mobile-connected devices in 2014.

·         Faster mobile speeds: The average mobile connection speed will grow 2.1-fold (16% CAGR) from 2014 to 2019, reaching 3,639 kbps by 2019.

·         More mobile video: By 2019, mobile video will represent 71% of South African mobile data traffic (compared to 51% at the end of 2014).

Impact of Mobile M2M Connections (and Wearable Devices) in South Africa

M2M refers to applications that enable wireless systems to communicate with similar devices to support global positioning satellite (GPS) navigation systems, asset tracking, utility meters, security and surveillance video. Wearable devices are included as a sub-segment of the M2M connections category to help project the growth trajectory of the Internet of Everything (IoE).

·         In South Africa the number of wearable devices will reach 2.4 million in number by 2019, up from 0.6 million in 2014, at 30% CAGR.

·         In South Africa, traffic from wearable devices is expected to fuel 20-fold growth in mobile traffic from wearable devices between 2014 and 2019.

·         In South Africa the average wearable device will generate 391 megabytes of mobile data traffic per month by 2019, up from 73 megabytes per month in 2014.

 

Growth of Mobile Cloud Traffic in South Africa

Cloud applications and services such as Netflix, YouTube, Pandora, and Spotify allow mobile users to overcome the memory capacity and processing power limitations of mobile devices.

·         In South Africa, mobile cloud traffic will grow 12.7-fold from 2014 to 2019 at 66% CAGR.

·         Cloud applications will account for 89% of total mobile data traffic by 2019, compared to 80% at the end of 2014.

* Follow Gadget on Twitter on @GadgetZA

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Gadget goes to Hollywood

Gadget visited the Netflix studios last week. In the first of a series, ARTHUR GOLDSTUCK talks to CEO Reed Hastings.

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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.

Reed Hastings at the Netflix studios in Hollywood last week. Pic: ADAM ROSE

“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.

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Take these 5 steps to digital

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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 it maps back to where you are and the strategic steps that will take you to where you want to go.

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.

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