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Shared services to drive municipal service delivery

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With pressure mounting on the government to reduce costs while improving governance and service delivery, there is an opportunity for municipalities to streamline their operations by adopting a shared services model.

During the recent 2016 Budget Speech, the emphasis was placed on the growing pressure faced by municipalities from both the rising cost of bulk services and the rapidly growing number of households. These pressures can, however, be mitigated through better coordination and shared resources. This is the view of Modise Nyawane, Managing Executive: LARA at Business Connexion.

“It makes no sense for each municipality to replicate their technology infrastructure purchases,” he says. “Municipalities can significantly reduce cost and improve efficiency by adopting a shared services model. In addition, to that, it will increase service delivery, transparency and ultimately citizen satisfaction.”

Nyawane says that by moving infrastructure to a central location and having a core team in place, there is less of a risk of billing delays. “Consolidation removes fragmentation and if your core responsibility is to do month-end runs, you do so across municipalities. This will be particularly important where there is high staff turnover – if your core functions are centralised, you will still have the required expertise to support the environment should someone leave. However, in the current environment, should someone within the billing department, leave, that job is left undone. Thereby impacting on the overall billing process and ultimately the municipality’s performance.”

He does, however, add that a change in mind-set will be required for this to succeed. “While it makes complete sense to centralise your infrastructure and core functions, there is still a level of hesitation from within the local government. We are often faced with the argument that they are happy to have their own server environment, giving them more control. The risk associated with this is, if the server crashes, the municipality comes to a complete standstill. In some instances, it could take months to replace the server,  with a huge impact on the municipality and its ability to deliver on its mandate.”

Another challenge facing municipalities is that of a shortage of the required specialised skills. “Municipalities are governed by the very specific financial legislature which requires an in-depth knowledge of the business of a municipality,” says Nyawane. “Here technology and consulting go hand in hand in ensuring that the municipality can execute on their financial obligations.”

Modernising municipalities’ infrastructure and digitising some of their operations can have a significant impact on their billing and ability to operate more effectively. “In order for us to make the vision of smart cities a reality, municipalities will have to invest in infrastructure and technology that support them in their digitising efforts. They don’t, however, need to carry the burden as an individual unit. If these solutions are rolled out at a metropolitan or even district level, providing shared services to the smaller local municipalities, the impact they have will be much bigger,” he says. “It will enable all municipalities within that district or metropolitan to deliver the same quality of services to their citizens. This resulting in driving down the cost of service delivery and improving overall transparency,” says Nyawane.

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Rain, Telkom Mobile, lead in affordable data

A new report by the telecoms regulator in South Africa reveal the true consumer champions in mobile data costs

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The latest bi-annual tariff analysis report produced by the Independent Communications Authority of South Africa (ICASA) reveals that Telkom Mobile data costs for bundles are two-thirds lower than those of Vodacom and MTN. On the other hand, Rain is half the price again of Telkom. 

The report focuses on the 163 tariff notifications lodged with ICASA during the period 1 July 2018 to 31 December 2018.

“It seeks to ensure that there is retail price transparency within the electronic communications sector, the purpose of which is to enable consumers to make an informed choice, in terms of tariff plan preferences and/or preferred service providers based on their different offerings,” said Icasa.

ICASA says it observed the competitiveness between licensees in terms of the number of promotions that were on offer in the market, with 31 promotions launched during the period. 

The report shows that MTN and Vodacom charge the same prices for a 1GB and a 3GB data bundle at R149 and R299 respectively.  On the other hand, Telkom Mobile charges (for similar-sized data bundles) R100 (1GB) and R201 (3GB). Cell C discontinued its 1GB bundle, which was replaced with a 1.5GB bundle offered at the same price as the replaced 1GB data bundle at R149. 

Rain’s “One Plan Package” prepaid mobile data offering of R50 for a 1GB bundle remains the most affordable when compared to the offers from other MNOs (Mobile Network Operators) and MVNOs (Mobile Virtual Network Operators).  

“This development should have a positive impact on customers’ pockets as they are paying less compared to similar data bundles and increases choice,” said Icasa.

The report also revealed that the cost of out-of-bundle data had halved at both MTN and Vodacom, from 99c per Megabyte a year ago to 49c per Megabyte in the first quarter of this year. This was still two thirds more expensive than Telkom Mobile, which has charged 29c per Megabyte throughout this period (see graph below).

Meanwhile, from having positioned itself as consumer champion in recent years, Cell C has fallen on hard times, image-wise: it is by far the most expensive mobile network for out-of-bundle data, at R1.10 per Megabyte. Its prices have not budged in the past year.

The report highlights the disparities between the haves and have-nots in the dramatically plummeting cost of data per Megabyte as one buys bigger and bigger bundles on a 30-day basis (see graph below).

For 20 Gigabyte bundles, all mobile operators are in effect charging 4c per Megabyte. Only at that level do costs come in at under Rain’s standard tariffs regardless of use.

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Qualcomm wins 5G as Apple and Intel cave in

A flurry of announcements from three major tech players ushered in a new mobile chip landscape, wrItes ARTHUR GOLDSTUCK

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Last week’s shock announcement by Intel that it was canning its 5G modem business leaves the American market wide open to Qualcomm, in the wake of the latter winning a bruising patent war with Apple.

Intel Corporation announced its intention to “exit the 5G smartphone modem business and complete an assessment of the opportunities for 4G and 5G modems in PCs, internet of things devices and other data-centric devices”.

Intel said it would also continue to invest in its 5G network infrastructure business, sharpening its focus on a market expected to be dominated by Huawei, Nokia and Ericsson.

Intel said it would continue to meet current customer commitments for its existing 4G smartphone modem product line, but did not expect to launch 5G modem products in the smartphone space, including those originally planned for launches in 2020. In other words, it would no longer be supplying chips for iPhones and iPads in competition with Qualcomm.

“We are very excited about the opportunity in 5G and the ‘cloudification’ of the network, but in the smartphone modem business it has become apparent that there is no clear path to profitability and positive returns,” said Intel CEO Bob Swan. “5G continues to be a strategic priority across Intel, and our team has developed a valuable portfolio of wireless products and intellectual property. We are assessing our options to realise the value we have created, including the opportunities in a wide variety of data-centric platforms and devices in a 5G world.”

The news came immediately after Qualcomm and Apple issued a joint announced of an agreement to dismiss all litigation between the two companies worldwide. The settlement includes a payment from Apple to Qualcomm, along with a six-year license agreement, and a multiyear chipset supply agreement.

Apple had previously accused Qualcomm of abusing its dominant position in modem chips for smartphones and charging excessive license fees. It ordered its contract manufacturers, first, to stop paying Qualcomm for the chips, and then to stop using the chips altogether, turning instead to Intel.
With Apple paying up and Intel pulling out, Qualcomm is suddenly in the pound seats. It shares hit their highest levels in five years after the announcements.

Qualcomm said in a statement: “As we lead the world to 5G, we envision this next big change in cellular technology spurring a new era of intelligent, connected devices and enabling new opportunities in connected cars, remote delivery of health care services, and the IoT — including smart cities, smart homes, and wearables. Qualcomm Incorporated includes our licensing business, QTL, and the vast majority of our patent portfolio.”

Meanwhile, Strategy Analytics released a report on the same day that showed Ericsson, Huawei and Nokia will lead the market in core 5G infrastructure, namely Radio Access Network (RAN) equipment, by 2023 as the 5G market takes off. Huawei is expected to have the edge as a result of the vast scale of the early 5G market in China and its long term steady investment in R&D. According to a report entitled “Comparison and 2023 5G Global Market Potential for leading 5G RAN Vendors – Ericsson, Huawei and Nokia”, two outliers, Samsung and ZTE, are expected to expand their global presence alongside emerging vendors as competition heats up.

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