SA web: Have-nots 'locked out'

2007-07-05 11:14

Nicole Rego

Johannesburg - Despite a massive growth in broadband connectivity, the number of South Africans with access to the internet will grow by little more than 3% in 2007, according to a study released on Thursday.

The study, titled the Internet Access in SA 2007 by World Wide Worx, shows that a total of 3.85 million people in South Africa - a mere 8% of the population (or 1 in 12 people) - will have access to the internet by the end of 2007.

"Despite the dramatic rise of broadband usage, this is the slowest growth we've seen in overall user numbers since the arrival of the internet in South Africa," said World Wide Worx Managing Director, Arthur Goldstuck, who has been tracking the internet market since 1993.

The study showed that there will be more than 800 000 broadband subscriber accounts active in South Africa at the end of this year. However, these represent only 650 000 unique users, or separate individuals. And, of these, a third also use another form of connectivity.

"The harsh reality is that broadband has not yet made a major impact on overall connectivity numbers, even while dramatically increasing the usage of those who are already connected. The majority of broadband users are simply migrating up the connectivity food chain, from dial-up to broadband.

So, while the haves get more, the have-nots remain locked out," added Goldstruck.

According to the study, the dial-up users were falling dramatically this year, dropping by 122 000 users, and falling below the million mark for the first time since 2001, which can be partly attributed to the growth of broadband within the dial-up user base.

A major obstacle

The Internet Access in SA 2007 also revealed the limited extent to which new users are coming on board at the entry level.

Goldstruck said that the high cost of local calls set by fixed line operator Telkom would not come down in August, which is a major obstacle to internet connectivity for the unconnected.

"Add to that the fact that line rental is in fact going up in price, placing yet another limit on the growth of fixed lines, and you have a no-win situation for the mass market."

This makes Telkom both the villain and the hero of internet connectivity in South Africa, he said.

Telkom's ADSL offering has been the main driver of broadband adoption in South Africa for the last four years. While it is expected to be overtaken by MTN and Vodacom's 3G mobile broadband by the end of 2007 in number of connections, it will continue to be the principal form of connectivity for most broadband users until at least 2009.

Many of these will use 3G as a backup connection or for use when out of the office or home, Goldstruck said.

The study shows that the only broadband offering attracting large numbers of new users, rather than upgrading existing users, is iBurst, the wireless broadband service from WBS. Until now the growth of iBurst has been held back by availability, but through its relationship with Vodacom it is expected to make a dramatic impact over the next two years.

Goldstruck said that Vodacom's own pending new ISP, Neotel's offerings expected in the coming months, and the effect of metropolitan city councils offering wireless broadband, have not been included in projections or expectations of growth for 2007 and 2008, due to the presently undefined nature of these offerings. However, he sees these as major interventions in connectivity growth and experience.

"The entry of these major players into internet services has to make a massive impact," Goldstruck said, adding that far too much is being invested in their infrastructure for them not to make a difference.

"By 2010 we can expect to see a substantially altered connectivity landscape. But certainly not in 2007," he concluded.

- I-Net Bridge (News24)