‘High-speed web access vital for small businesses’
One of the country’s fastest-growing townships, Soweto, was only included in fixed-line company Telkom’s roll-out plan for high-speed Internet via ADSL (asymmetric digital subscriber line) at the end of 2005.
In October 2005, a survey by the SMME (small, medium and microenterprise) forum revealed that not a single ADSL line existed in Soweto. "This was highly disturbing for us, as this limits SMME access to markets and information," said forum head Tebogo Khaas.
Khaas said the demand for high-speed internet in townships was there, but that high costs were limiting access and thus hampering SMME growth. "Government has been sleeping for quite a while and it’s time they woke up to the needs of the market."
He believed the ideal would be for government to allow tax breaks for firms providing free or less expensive connectivity to faster connections, such as broadband. He said it would benefit the economy if more people were taught to use this technology.
Khaas believed the number of Internet users could easily double by making the environment more accessible.
The number of internet users in South Africa is 3,2 million, according to independent technology research organisation World Wide Worx. World Wide Worx head Arthur Goldstuck agreed the cost of high-speed Internet access was widening the digital divide. He said if prices didn’t come down, only those with the resources would be able to access information and those without would be left out in the cold.
He said research in other developing countries showed that though some had higher accessibility costs than South Africa, those with cheaper Internet saw increased SMME activity. There was also a correlation between government support for the industry and cheaper Internet. "These governments were actually making the environment more conducive to lower costs, instead of just paying lip service."
Goldstuck believes that less intervention by government and opening up a competitive industry is critical to improving industry conditions.
Last week, Telkom revealed its plan to invest R30bn in fixed-line expenditure over the next five years. A part of its strategy includes setting up a broadband network. "I can’t see that this will lower costs for Internet users," said Goldstuck. "Rather, it will improve Telkom’s competitiveness as a company." This year Telkom will face competition for the first time with the introduction of a second network operator.
There is already increasing competition from wireless companies who are less dependant on fixed-line connections, such as iBurst and Internet Solutions, but Khaas said though these were good for customers, "they are not as stable as ADSL".
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