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The real cost of SA’s most expensive website

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The budget for South Africa’s most expensive web site yet makes for startling reading, writes ARTHUR GOLDSTUCK, who pins down its cost.

More was spent on the planning of the Free State government web site than most South African corporates have ever spent on the full development and implementation of their web sites.

The tender was awarded by the Free State Province on 24 February 2012 for the ‚”Redesign/Relaunch of a comprehensive and integrated website‚” to the ‚”Cherry Ikamva-Jugganaut Joint Venture‚”. It includes four phases prior to implementation, followed by implementation, maintenance and ‚”content generation and management‚”.

The tender award document, supplied yesterday to Radio 702 by the Office of the Director General of the Free State Provincial Government, makes for startling reading.

Phase one, for ‚”planning, conceptualization, research & information development‚”, allocates the following funds for financial year 2011/12:

‚”R350 000 per site for departments and Metro:

R300 000 per site for larger Local Municipalities:

R200 000 per site for Entities and District Municipalities:

R150 000 per site for other Local Municipalities‚”.

The Free State Provincial Government comprises 11 departments, including the Office of the Premier. Along with the Metro, the first line item therefore comprises 12 sites, for a total cost of R4 200 000.

The Free State province comprises 19 local municipalities, of which 6 could be described as ‚”larger‚” (those that include the larger Free State towns, namely Kroonstad, Welkom Sasolburg, Parys, Harrismith and Bethlehem). The second line item, based on this outline, comes to R1 800 000.

The province includes four ‚”District Municipalities‚”, which are in effect umbrella bodies for the 19 local municipalities. The Entities refer to statutory bodies, of which there are four: Free State Tourism Authority, Free State Gambling and Liquor Board, Free State Development Corporation and Centlec, the local electricity authority in Bloemfontein. Based on these municipalities and entities, the third line item amounts to R1 600 000.

A total of 13 ‚”other Local Municipalities‚” are not included in the second line item, making for a cost, in the fourth line item, of R1 950 000.

The total cost, then, of planning the Free State government website was R9 550 000.

Phase Two, for ‚”Design‚”, also allocated to the 2011/12 financial year, included the same line items, with the same costing. In other words, the Design of the site/s cost exactly as much as the planning: a total of R9 550 000.

The allocation for Phase Three, the ‚”Development and Creation‚” of the site/s, was R1 100 000.

Phase Four, for ‚”Testing‚”, was open-ended, specifying ‚”R900 per hour x 10 persons‚”. Assuming, very conservatively, that three 8-hour days were allocated for testing, this would have amounted to a relatively humble R216 000. No ceiling was placed on this amount, however, and it could be ten times as high.

Phase Five, for ‚”Implementation‚”, which appeared to be something other than design, development, creation and testing, was given a budget of R413 600.

The total for the first five phases is R20 829 600, simply to get the site/s up and running.

Phase Six A, for Maintenance, and Six B, for ‚”Content Generation and Management‚”, is a fascinating mix of hidden and unstated cost. Maintenance is costed at ‚”R900 per hour x 2 persons‚”. It can safely be assumed that maintenance was allocated to budget as an ongoing function, i.e. 40-hours per week x 2 persons, amounting to R72 000 per week. Assuming the financial year ended in June, as it usually does for provinces, and a modest 12 weeks of maintenance was provided, the total would be R864 000.

Phase Six B, ‚”Content Generation and Management‚” allows for ‚”R75 000 per month per site x three months‚” in financial year 2011/12. The total number of sites, derived from the breakdown of Phase one, is no less than 39. For one month, the cost is R2 925 000. For the last three months of financial year 2011/12, the total cost was R8 775 000.

Assuming the project started in time for three months of content generation and management to be provided in the 2011/12 financial year, the total paid out in the four months after the tender was awarded would have been R30 468 600.

For financial year 2012, two phases are provided namely:

‚”Phase: Maintenance, including review and update of design: R900 per hours:

‚”Phase: Content Services, Generation and Management: R68 253 per month per site.‚”

Based on four weeks of maintenance per month, and assuming one person responsible, the cost of maintenance is R144 000 per month, or R1 728 000 per year. This assumes that it is not a per-site cost.

Content services, generation and management, on the other hand, is a per site service which, for 39 sites, amounts to R2 661 867 per month, or R31 942 404 for the 2012/13 financial year.

The total cost of the web site for 2012/13: R33 670 404.

The allocation for 2013/2014 is exactly the same as for 2012/13: R33 670 404.

This puts the total cost of the site over less than three years at R97 809 408.

This, in turn, gives the Free State Government website (http://www.freestateonline.fs.gov.za) the distinction of being the most expensive website ever built (or not built) in South Africa. The previous website to hold that dubious honour, a South African Airways site aimed at foreign visitors, cost R90-million in a venture that was eventually aborted in 2001.

By way of comparison, the website of the South African Presidency (http://www.thepresidency.gov.za/), which is somewhat more complex than that of the Free State provincial Government, was built and maintained by Absol Internet Business Solutions (which hosts the Gadget website and content management system) at a total cost of about R250 000 over the past four years.

* Follow Arthur Goldstuck on Twitter on @art2gee

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In fact for the last yearn and a half we have been building a multisite system that runs 100+ eccom stores. total cost including propagation around R300K including hosting maintenance and all other sundry items including licensing. We looked at it yesterday and to build an equivelent system to the FS website even with multisite ( which is enabled on their site ) would have taken under a week and probably cost 50K to its current phase!

As a developer who has run large private sector and government projects, the most we have ever charged is around 450 K and that was for a bespoke data storage system designed to handle millions of items and up to 20000 active uploaders at any time. The sheer audacity of the line items in this tender basically mean that some one has had a great paw greasing, makes me sick!

See it here:

themeforest.net/item/london-live-3-in-1-news-magazine-and-blog/full_screen_preview/154462

For 1/10th of that cost the department could have created it’s own internal team to do it…

It’s painful to know this is where our taxes are going, but considering the state of our education and housing and services it’s an absolute disgrace. How many bursaries could have been granted instead, how many houses built for the poor?

Maybe the presidency, knowing what their website cost should pass any and all future tenders through Absol, since they clearly know what a fair price is.

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Telcos want one face

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The investments that telecommunications service providers are making in reshaping their online properties into customer-centric portals reflects the growing maturity of self-service and Internet uptake in the industry, says KEVIN MELTZER of Consology.

Many telcos around the world are overhauling their websites to offer customers more holistic portals that give them a single point of entry into the organisation.

They are doing so because they recognise that service will be a key point of differentiation for their businesses in a market that is becoming increasingly competitive. They have also realised that they have a major opportunity to shift customers away from expensive contact centres towards low-cost electronic channels.

In the past, most telecommunications operators ran multiple sites across multiple domains and subdomains. These web-based properties were built around the way that telcos structured their own businesses rather than around the needs of the customer. But we are now seeing the leading operators take a more user-centric approach to the way that they design their web and mobile sites.

This coincides with a change in the industry from slicing customers into numerous segments and then serving them across a range of functional and product areas. For example, many operators split customers into prepaid and postpaid segments or voice and data users, distinctions that are becoming less meaningful in a world of technology convergence. They now want to present a single face to the customer rather than servicing the subscriber through silos.

These changes are starting to percolate through to operators’ customer service and sales strategies. Telcos are starting to pull together disparate products and services that once resided across multiple sites into customer service portals.

These sites put a wide range of information at the subscriber’s fingertips, he adds. Increasingly, for example, subscribers can log directly into their accounts from the operator’s homepage and then access a wealth of services and information. This marks an evolution from the fractured and inconsistent customer experience of the past.

Leading operators are even thinking about how their Self-Service platforms should be integrated with social media strategies to allow customers to pay their electronic bills or top up airtime with a single click from within a social network.

Whereas Self-Service portals on telco sites were once purely about account management functions, they increasingly offer far richer functionality. In addition to allowing subscribers to pay their bills and check their account information, they are also increasingly becoming the first stop for service and commerce.

Operators have started to recognise that splintering their e-commerce, service and account management functions simply makes no sense. Customers want to be able to do everything through one interface rather than needing to visit two or three Web sites, or eventually possibly needing to phone a call centre or visit a store for certain transactions.

Integrated and easy to use online customer service channels will be central for telco operators who want to be competitive in the markets of tomorrow. They form an advantage in an industry where it will be customer relationships rather than cost or service that drive loyalty and purchasing decisions.

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Talk for less with MWEB Talk

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Today, MWEB announced its consumer VoIP package called MWEB Talk, which allows users to make free network calls and get discounted rates made to landlines and mobile phones.

MWEB, today launched its new Voice over IP (VoIP) offering to South African consumers. The service, MWEB Talk, will offer users’ free on network calls to fellow MWEB Talk users’ and cheap calls to landline and mobile phone numbers. This follows the success and demand of the ISP’s existing VoIP products in recent months.

‚”We have seen a noticeable transformation in users’ Internet behaviour with consumers wanting services that complement their ADSL connectivity solution. We have seen phenomenal growth and by the end of the year will deliver over 100 million minutes on our VoIP platform,‚” says Carolyn Holgate, General Manager of MWEB Connect, the ISP’s Consumer and Small Office/ Home Office Division.

MWEB has made significant investments in its infrastructure and VoIP has been prioritised on its network to ensure performance and stability of the MWEB Talk service for both businesses and consumers.

‚”In addition to the high quality of the service, MWEB Talk is also simple to set-up and users’ should experience a significant reduction in their telephone bills. By implementing a VoIP service consumers and small businesses can cut their monthly telecommunication bills by up to 55% to landline and mobile numbers,‚” says Holgate.

With no subscription fee, existing MWEB customers can log into their MWEB account, register for the service and download the application for PC and Mac as well as mobile applications that turn an iPhone, Android, and Nokia smartphone into a VoIP phone. Customers will also be able to purchase a Desktop VoIP Handset for R99 which will be HD voice ready and will support multi-extensions.

‚”We believe that VoIP is the future of telephony in South Africa and we are extremely excited to see the consumer market shift into the VoIP space,‚” concludes Holgate.

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