A major challenge when travelling internationally is to remain connected without breaking the bank. In the second of a series of articles on travel technology, ARTHUR GOLDSTUCK declares war on bill shock.
We may have defeated the monster of interconnect fees that have needlessly inflated cellular bills over the years, but there is another demon to be fought. It may affect fewer people but, for those it does, the effect is far more severe.
It is called roaming, and it represents a monumental assault on both the rights and the budgets of travellers. The worst offender is data use on a phone. The highest price one can pay for data as a South African user in this country is R2 per Megabyte of data downloaded or uploaded, and even that is exorbitant. For those who can afford it, buying a data bundle brings the price down to less than 10c per Megabyte.
Out of the country, however, if you forget to disable mobile data while roaming, the cost can shoot up to as much as R150 per Megabyte. To put that in context, using up a typical bundle costing around R200 for 1 Gigabyte in South Africa will suddenly cost R150 000. And no, that’s not a misprint.
The European Union has recognised the rapacious nature of such rates and dictated a cap of 20 Euro cents for mobile customers of operators within the EU, roaming within the EU. In other words, it doesn’t apply if you come from elsewhere. That means South Africans still have no protection there. The International Telecommunications Union has looked at the issue from a global perspective, but appears to lack the teeth to do much more than “look”.
Part of the problem is that roaming rates are based on bilateral agreements between networks, since there is no cross-border regulator that can enforce rates.
Of course, mobile operators themselves should be more vigorous in addressing the issue. After all, the likes of Vodafone and MTN have vast international networks that could contribute significantly to the debate. However, networks benefit hugely from customers of other networks roaming on their own networks, and have demonstrated little enthusiasm for killing the goose that lays this diamond egg.
In the same way, they fought tooth and nail against the cutting of interconnect fees in South Africa, arguing it would force them to increase rather than decrease the cost of calls. No one was buying the argument then and, half a dozen cost cuts later, the disingenuousness of the argument has been thoroughly exposed. Right now, we have the same kind of disingenuous arguments around roaming rates.
So, before providing a weapon in the fight against bill shock, let it be firmly stated: the current high international roaming rates for data are unjustifiable, indefensible, and unconscionable. The networks should expect no sympathy or understanding for their arguments justifying the rates. “Just do something about it,” is the message of the consumer.
The obvious cure for roaming data is to have a mobile Wi-FI device, commonly referred to as a Mi-Fi, although MiFi is in fact a brand name for a mobile Wi-FI device first manufactured by Novatel. In South Africa, most such devices are manufactured by Huawei, with ZTE and Alcatel also players.
One then needs to pick up a local data SIM card the moment one lands at a foreign airport. The problem is that, at many airports, no such option is available. In some cases, like at Heathrow in the UK, one can pick up incredibly cheap SIM offering unlimited data for a month at less than £20.
At JFK in New York, a more limited option can cost twice as much.
In the USA, the best current option is to visit a T-Mobile store and pay $40 for a SIM card that offers 1GB of data at 4G speeds, and then unlimited data at around 182 kbps. The store assistants will tell you that it’s not usable at that speed and you should pay twice as much for a bigger bundle, but the slower option is in fact quite effective for anything ranging from e-mail to WhatsApp and basic browsing on a phone.
In many countries, even better options are available, but in others the cost is prohibitive. The more countries one visits, the more complex the process becomes.
The best option is, on arrival at a foreign airport, hiring a Mi-Fi device that includes a data SIM card and data allowance, but this also depends on the luck of the airport draw. So far, I’ve found such options at reasonable prices only in Tokyo and San Francisco.
The ideal, of course, it to have an option that is set up even before one departs, and that works anywhere, across countries, cities, airports, transit lounges, and points between. And, fortunately, there is just such an option.
I was rescued on a recent trip through several countries by a device called PocketWifi, from South African company ExceMobile. It looks like a fat Mi-Fi, but its magic is on the inside. It contains no less than six SIM cards, each representing agreements with networks that cover almost every country in the world. One of them also acts as a master SIM through which the device is updated when needed.
The cost of usage may not seem low at first site: ranging from R199 to R349 per day, depending on the country, with 300MB of data included in the rate and a new bundle applied as one uses up each bundle.
High, maybe, but faced with the alternative, of up to R150 for 1 MB, it is not only viable, but is also an obvious solution.
On a recent brief trip that covered Germany and Poland, I incurred an ExecMobile bill of R996, which is high compared to my usual local bill. But the cost, had I been on mobile data roaming on the phone, would have been – hold your breath – R72 300 on MTN, and R73 472 on Vodacom.
Okay, breathe now. It’s okay. You’re going to be fine. You weren’t roaming.
Or were you?
Online retail gets real
After decades of experience in selling online, retailers still seek out the secret of reaching the digital consumer, writes ARTHUR GOLDSTUCK.
It’s been 23 years since the first pizza and the first bunch of flowers was sold online. One would think, after all this time, that retailers would know exactly what works, and exactly how the digital consumer thinks.
Yet, in shopping-mad South Africa, only 4% of adults regularly shop online. One could blame high data costs, low levels of tech-savviness, or lack of trust. However, that doesn’t explain why a population where more than a quarter of people have a debit or credit card and almost 40% of people use the Internet is staying away.
The new Online Retail in South Africa 2019 study, conducted by World Wide Worx with the support of Visa and Platinum Seed, reveals that growth is in fact healthy, but is still coming off a low base. This year, the total sale of retail products online is expected to pass the R14-billion mark, making up 1.4% of total retail.
This figure represents 25% growth over 2017, and comes after the same rate of growth was seen in 2017. At this rate, it is clear that online retail is going mainstream, driven by aggressive marketing, and new shopping channels like mobile shopping.
But it is equally clear that not all retailers are getting it right. According to the study, the unwillingness of business to reinvest revenue in developing their online presence is one of the main barriers to long-term success. Only one in five companies surveyed invested more than 20% of their online turnover back into their online store. Over half invested less than 10% back.
On the surface, the industry looks healthy, as a surprisingly high 71% of online retailers surveyed say they are profitable. But this brings to mind the early days of Amazon.com, in 1996, when founder Jeff Bezos was asked when it would become profitable.
He declared that it would not be profitable for at least another five years. And if it did, he said, it would be in big trouble. He meant that it was so important for long-term sustainability that Amazon reinvest all its revenues in customer systems, that it could not afford to look for short-term profits.
According to the South African study, the single most critical factor in the success of online retail activities is customer service. A vast majority, 98% of respondents, regarded it as important. This positions customer service as the very heart of online retail. For Amazon, investment back into systems that would streamline customer service became the key to the world’s digital wallets.
In South Africa online still make up a small proportion of overall retail, but for the first time we see the promise of a broader range of businesses in terms of category, size, turnover and employee numbers. This is a sign that our local market is beginning to mature.
Clothing and apparel is the fastest growing sector, but is also the sector with the highest turnover of businesses. It illustrates the dangers of a low barrier to entry: the survival rate of online stores in this sector is probably directly opposite to the ease of setting up an online apparel store.
A fast-growing category that was fairly low on the agenda in the past, alcohol, tobacco and vaping, has benefited from the increased online supply of vapes, juices and accessories. It also suggests that smoking bans, and the change in the legal status of marijuana during the survey, may have boosted demand.
In the coming weeks, we can expect online retail to fall under the spotlight as never before. Black Friday, a shopping tradition imported “wholesale” from the United States, is expected to become the biggest online shopping day of the year in South Africa, as it is in the USA.
Initially, it was just a gimmick in South Africa, attempting to cash in on what was a purely American tradition of insane sales on the Friday after Thanksgiving Day, which occurs on the third Thursday of November every year. It is followed by Cyber Monday, making the entire weekend one of major promotions and great bargains.
It has grown every year in South Africa since its first introduction about six years ago, and last year it broke into the mainstream, with numerous high profile retailers embracing it, and many consumers experiencing it for the first time.
It is now positioned as the prime bargain day of the year for consumers, and many wait in anticipation for it, as they do in the USA. Along with Cyber Monday, it provides an excuse for retailers to go all out in their marketing, and for consumers to storm the display shelves or web pages. South African shoppers, clearly, are easily enticed by bargains.
Word of mouth around Black Friday has also grown massively in the past two years, driven by both media and shoppers who have found ridiculous bargains. As news spreads that the most ridiculous of the bargains are to be had online, even those who were reticent of digital shopping will be tempted to convert.
The Online Retail in SA 2019 report has shown over the years that, as people become more experienced in using the Internet, their propensity to shop online increases. This is part of the World Wide Worx model known as the Digital Participation Curve. The key missing factor in the Curve is that most retailers do not know how to convert that propensity into actual online shopping behaviour. Black Friday will be one of the keys to conversion.
Carry on reading to find out about the online retailers of the year.
Reliable satellite Internet?
MzansiSat, a satellite-Internet business, aims to beam Internet connections to places in South Africa which don’t have access to cabled and mobile network infrastructure, writes BRYAN TURNER.
Stellenbosch-based MzansiSat promises to provide cheap wholesale Internet to Internet Service Providers for as little as R25 per Gigabyte. Providers who offer more expensive Internet services could benefit greatly from partnering with MzansiSat, says the company.
“Using MzansiSat, we hope that we can carry over cost-savings benefits to the consumer,” says Victor Stephanopoli, MzansiSat chief operating officer.
The company, which has been spun off from StellSat, has been looking to increase its investor portfolio while it waits for spectrum approval. The additional investment will allow MzansiSat’s satellite to operate in more regions across Africa.
The MzansiSat satellite is being built by Thales Alenia Space, a French company which is also acting as technical partner to MzansiSat. In addition to building the satellite, Thales Alenia Space will also be assisting MzansiSat in coordinating the launch. The company intends to launch the satellite into the 56°E orbital slot in a geostationary orbit, which enables communication almost anywhere in Africa. The launch is expected to happen in 2022.
The satellite will have 76 transponders, 48 of which will be Ku-band and 28 C-band. Ku-band is all about high-speed performance, while C-band deals with weather-resistance. The design intention is for customers of MzansiSat to choose between very cheap, reliable data and very fast, power-efficient data.
C-band is an older technology, which makes bandwidth cheaper and almost never affected by rain but requires bigger dishes and slower bandwidth compared to Ku-band connections. On the other hand, Ku-band is faster, experiences less microwave interference, and requires less power to run – but is less reliable with bad weather conditions.
MzansiSat’s potential military applications are significant, due to the nature of the military being mobile and possibly in remote areas without connectivity. Connectivity everywhere would be potentially be life-saving.
Consumers in remote areas will benefit, even though satellite is higher in latency than fibre and LTE connections. While this level of latency is high (a fifth of a second in theory), satellite connections are still adequate for browsing the Internet and watching online content.
The Internet of Things (IoT) may see the benefits of satellite Internet before consumers do. The applications of IoT in agriculture are vast, from hydration sensors to soil nutrient testers, and can be realised with an Internet connection which is available in a remote area.
Stephanopoli says that e-learning in remote areas can also benefit from MzansiSat’s presence, as many school resources are becoming readily available online.
“Through our network, the learning experience can be beamed into classrooms across the country to substitute or complement local resources within the South African schooling system.”