Presentation on theme: "The Internet in South Africa The end of the road or the start of the next wave?"— Presentation transcript:
The Internet in South Africa The end of the road or the start of the next wave?
Why the internet is important It is strongly associated with economic growth and job creation It is an important tool for business across distances It is a key tool to raise the competitiveness of value chains New types of business opportunities are enabled through removal of distance, e.g call centres and other back office operations It has a major role in social development (e.g. health and education) It is a key mechanism to increase democracy and improve government services
And Africa? Two contrasting extreme views: “leapfrog” – the Internet can render historical backwaters hugely better off and can help them skip stages of development versus: “dig it all”—the view that developing countries have become a plaything for developmentalist techies with new toys
Who is right? Leapfrog? Tourist bookings with SMEs in rural Tanzania American insurance companies with back office operations in Ghana French digitising & translation in Morocco CAD offices in Senegal for Europe Digital mapping in Dar es Salaam for companies in California VOIP call centre for US clients in Togo A tele-hospital in Gambia
Who is right? The “Dig-it-all” divide? Gap between the hype of the technology and how it can be used by people in poverty Dot.forces descended on Africa, but Telecentres are lying fallow Infastructure is built with no content or services Internet in some schools, but teachers can’t or won’t use it In the absence of other services, how much of a priority can ICTs be?
The Internet has disappointed The crash of the dot.coms contributed to the NASDAQ losing 2/3 of its value The telecommunications debt crisis stems in good part from lower than anticipated usage for data exchange through the internet Social services like health and education have developed fully-fledged systems far slower than expected A big disappointment is the failure of the net to empower small businesses
Why did the net disappoint small business? It was thought that the net would allow B2B and B2C access for small businesses That the net would reduce inequalities between small and big businesses in regard to marketing and sales (remember the IBM ads?) That the net would open access…
Why did the net disappoint small business? BUT The net favoured big business in B2C because importance of credibility & trust & brand The net did not help small businesses in open B2B systems for similar reasons B2B dominated by large companies using closed, tightly knit communities
Growth in Internet Usage is Slow in SA Only about 3.5 million terminals (compared with 17m telephone terminals) Only about 30% of businesses have Internet access E-commerce transaction growth is much slower than expected Public service usage is growing slowly Quality content for wide markets is yet to arrive The cost and bandwidth of telecommunications has been an inhibitor Access to suitable telecoms is a factor in the rural areas
But there are important positive factors The major telecoms operator is now launching ADSL services A second fixed line network operator will introduce further competition in data distribution Digital TV and other interactive multimedia will broaden usage Other devices are increasingly delivering the Internet
Other important positive factors Role of internet in value chains, especially in export sectors (findings of diffusions study) The “SMEs” in under-serviced areas could provide more services Government Gateway project and Golaganang project Introduction of an Education Rate in terms of the telecoms act
Government Initiatives The Cabinet’s Microeconomic reform strategy Integrated Manufacturing Strategy: Knowledge Intensive Manufacturing The President’s Commission for ISAD and the International ICT Commission E-strategy Task Force in terms of the ECT Act\ Specific supply side programmes
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