The high cost to provide broadband access in South Africa is exacerbated by South Africa’s low multi-dwelling ratio – i.e. how many people, on average, live in a building.
To provide broadband access to a consumer constitutes around 50% of the total cost of a broadband service.
The high access cost for broadband is particularly relevant when providing fibre to the home, where a physical fibre connection must be provided to a residential property.
The access cost can be shared in areas where many families live in the same building (multi-tenant building), but this is not common in South Africa.
“In the European Union the multi-tenant dwelling ratio is 71%, which means that 71% of people live in a multi-tenant dwelling,” said Armstrong.
This means that if you lay a piece of fibre to a building, you can connect more than 3 homes with a single piece of fibre.
“In South Africa the multi-tenant dwelling ratio, including gated communities, is 6% to 7%. This means that every home you connect requires its own physical connection,” said Armstrong.
This, Armstrong said, is one of the reasons why mobile and wireless technologies are a very compelling solution in South Africa.