Sep 07, 2012
Lack of infrastructure, regulation hampering SA’s data industryBack
Africa|Education|EMC Europe|Flow|Systems|Wireless|Africa|South Africa|E-government|Fixed Wireless Services|Flow|Gross Domestic Product|Internet Protocol Communications Company Internet Solutions|Internet Solutions|Internet Solutions Carrier Solutions|Local Telecommunications Industry|Oil|Online Sales|Point-to-point Multihop Systems|Product|Products|Regulatory Framework Involving Last-mile Connectivity Technologies|Retail Sales|Service|Services|Solutions|Systems|Telecommunications|Telecommunications Networks|Widespread Telecommunications|Brian Pinnock|Chris Hemingway|Greg Montjoie|Infrastructure|Raj Wanniappa|Rian Breed|Middle East|Broadband|IP|Regulatory Framework Involving Last-mile Connectivity Technologies
© Reuse this
However, the lack of infrastructure and an infrastructure sharing and regulatory framework involving last-mile connectivity technologies is hampering the transmission of this large volume of data to users. This not only reduces the volume of use and, hence, business involving data, but also the benefits of advanced telecommunications for society, says Internet Solutions carrier solutions head Raj Wanniappa.
“Online sales typically account for 7% to 10% of retail sales in developed markets. In South Africa, this share is closer to 0.5%,” explains Pinnock, adding that an increasing number of countries now see broadband as the backbone of their economies in the decades ahead because an increase in broadband penetration has been shown to have a strong stimulus effect on gross domestic product.
However, in South Africa, the increased use of broadband, which enables e-government, business use, education, job creation, innovation and personal data, is constrained by a lack of broadband penetration. Intensity of use and appropriate skills are also crucial, he notes.
“In South Africa, infrastructure has degraded and has been underused, resulting in a coverage problem. “Mobile wireless provided some relief, but does not provide an enterprise-grade service yet,” says Wanniappa.
The local telecommunications industry continues to contend with the delay in spectrum reallocation by governing bodies and has relied partially on test spectrum bands and unregulated spectrum bands for fixed wireless services, including point-to-point multihop systems, to bypass the lack of spectrum allocation, says Internet Solutions carrier innovation technology manager Rian Breed.
However, big data constitutes a type of “new oil” that can be generated by enabling improved and widespread telecommunications and data services. Global financial institution the World Economic Forum has recognised that data are assets to companies, says Internet Solutions cloud executive Greg Montjoie.
“Concerning regulation, government’s involvement in the situation has not played out yet and there will be more stringent demands placed on all organisations with regard to tracking and controlling data,” he says.
Key challenges concerning big data are the volume and speed of the data to be moved, which must also manage the connection latency sensitivities of different users. This will require analysis of these complex data streams, which include a wide variety of data from multiple sources, and will enable proactive data management, he explains.
This shift towards data analysis can result in, for example, matching data to a user’s preferences for online retail, or the management of data from an artificial heart to automatically regulate blood flow, says cloud computing and data company EMC Europe, Middle East and Africa emerging service providers director Chris Hemingway.
“Big data is disruptive and this is why analysis on big data will be important. However, increased use will have an impact and the volume of data will have a big economic impact,” he notes.
Meanwhile, Pinnock highlights that the increased use of technology, the rapid developments in electronic transactions and the variety of distribution media for products will necessitate a change in most business models. This is especially true where competitors are offering free and ‘freemium’ sales models.
Research done at the Massachusetts Institute of Technology in behavioural economics shows that, when contrasting demand for two products with a fixed difference in price, people perceive the benefits of a product that suddenly becomes free as dramatically higher than when it was simply low cost, further driving consumption. However, an average of 10% of users will still pay for a premium product rather than the free version, with important implications for online retailers, he explains.
“Business will have to reinvent itself in the face of the speed at which digital disruption is taking place, from redesigning a retail store to changing business models, and amid the waves of innovation that will cause rapid disruptions to existing markets,” Pinnock concludes.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines (150 word limit)
Other Competition Policy News
Recent Research Reports
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
This Week's Magazine
The international Square Kilometre Array (SKA) radio telescope – which is to be jointly hosted by South Africa and Australia with, later, outstations in other countries – may not yet exist, but international scientific working groups are already deciding what...
A free Web-based solar power plant capacity-planning tool offers project planners and developers, as well as governments, a means to assess the solar energy potential of thin-film solar PV power over an area of land. The tool was developed by thin-film solar...
As yet, no specific methodology, timeline or costs have been finalised to remedy the water ingress, excessive to contractual specifications, into the Gautrain tunnel between emergency shaft two (E2) and Park Station, says Bombela Concession Company technical and...
The “seriously disruptive” electricity outages in South Africa have cost packaging group Astrapak more than R2-million in “irrecoverable downtime costs”, the company said on Monday, adding that the power cuts were negating some of the benefit of energy saving...
Bakkies and more affordable cars dominated South Africa’s new vehicle market in 2014. Unaudited data from the Department of Trade and Industry (DTI) shows that South Africa’s most popular vehicle in 2014 was the Toyota Hilux, selling 37 562 units.