Wireless broadband may outperforme fixed line services
This is according to Michelle Branco, product marketing manager for Internet Solutions (IS) who noted that while the growth in both the ADSL and the wireless arena was exponential, wireless services look set to eat into the fixed line.
Branco noted that analysts struggle to predict the growth of the South African broadband industry and have in the past underestimated the demand for broadband services. “From the report it s evident that not even experts had any idea of what broadband uptake would be like,” said Branco.
Predictions from the South African research company, BMI-TechKnowledge, sit in the region of 662 000 broadband users by 2008. But as Branco noted the figures in the past have been consistently underestimated.
Whilst the true extent of broadband growth in South Africa is debatable one trend that seems to be fact is that wireless broadband services will become increasingly popular.
In 2004 wireless services were negligible with a paltry 4600 subscribers. By 2009 BMI-T predicts that this access medium will grow to 12%. What is interesting is that ADSL which held 3.2% of the pie in 2004 will only grow to 17% with both services stealing market share from the 95% which dial-up held in 2004.
A good look at the figures reveals that wireless will start to grab a bigger piece of the broadband pie as time passes.
This trend is not in line with international trends. Overseas broadband users typically use wireless services if they need to be mobile but the biggest majority of users are connected via fixed line services.
In South Africa the difference between the fixed line and wireless service penetration is not as pronounced as overseas and according to Branco much of this can be attributed to the fact that there are no wholesale facilities leasing regimes.
Basically it boils down to the fact that Telkom control the wholesale market and because they are a legally protected monopoly they are able to set the price according to their and their shareholders’ needs.
The picture for wireless providers looks bright but as Branco pointed out South Africa’s broadband penetration rate looks abysmal and this can be directly attributed to the fact that the price for broadband is far higher than the rest of the world.
It is unheard of for a country to rely on the more expensive, less reliable wireless services for connectivity. For South Africa to be competitive in the global arena fixed line offerings need to fall in line with international trends.
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