Internet: Hype versus Reality
Arthur Goldstuck (World Wide Worx) links the question of internet users frustrated by over-promises and under-delivery to the promises of the broadband era.
“There is a fundamental disconnect between what users are promised and what they get. The typical ADSL that promises you 1 Mbps may deliver anywhere between 55 and 255 kbps, which is a dramatic gap in promise versus delivery. With a 7,2 Mbps 3G card you are lucky if you get half the advertised speed!”
Marius Vermeulen (Tarsus) agreed with Goldstuck: “Those who travel to other countries enjoy a much better internet experience there. Coming back to South Africa to their 384 kbps Telkom ADSL line, they are soon disillusioned when downloading from a foreign website – the same one that downloaded with lightning speed while overseas. For a start, we need to revise the term broadband; one can hardly talk about 128 kbps as broadband.”
“We have seen some improvement”, said Colin Pinkham (MTN), “but we still have a long way to go. The people at the top end seem to be doing quite nicely, but those at the bottom end are still struggling with low internet speeds. It has a lot to do with lack of adequate infrastructure. We have seen improvements, so perhaps it is not as bad as the picture some paint!”
I asked Aingharan (Kutty) Kanagaratnam about Ericsson’s global vision of 50-billion internet connections by 2020. He said they believe it is possible – for not just people-to-people internet connections but also machine-to-machine and machine-to-human interface.
On the question of delivery he said that one of the problems is that our cities are not at the same stage of development that we see elsewhere in the world. They have underground tunnels and subway systems that facilitate the rollout of fibre without costly trenching.
“We certainly have the international connection but the bottleneck is still the lack of adequate internal backbone. We must also not underestimate the advances in mobile which could well reach 84 Mbps in the next few years.”
“To me it all comes down to quality of service,“ Yaron Assabi (Digital Communications) said.
“Many network providers do not have the capacity or the tools to deliver the service. Perhaps service providers should offer two types of services, a contended service at x price which is not guaranteed and an un-contended, guaranteed service at an x-plus price, but really delivering quality.”
If relying on cloud applications, one cannot afford to use a contended service with variable quality, as more users share the pipe.
Talking from the converged side, Tony Smallwood (Vodacom) said that we must not underestimate the changing profile of consumers.
“They are using more and applications and have an insatiable demand for bandwidth as they engage in applications like YouTube, Facebook and Twitter. There must be a balance between a reliable service and quality.”
He agreed with Assabi that ISP’s should offer both a contended and an un-contended service.”
We next discussed the uncapped ADSL service now being offered by several service providers.
It was launched with great fanfare by some, but customer experience does not seem commensurate with the hype. Do ISPs offer uncapped services, knowing full well that with the slow down- and upload speeds, they stand to lose little, while only increasing consumer frustration?
Pinkham (MTN) said he is not a fan of a model that is not affordable.
“Under the current circumstances it must either be a very expensive service or it has to be limited in some way. If it is uncapped and there are conditions attached to it, then the service provider must be upfront.
I like the uncapped models around the world but I don’t think that South Africa can afford it at the moment. Even with all the hype around the new sub-marine cables, it should be borne in mind that an ISP spends at least 40% of his income on international connectivity. The other biggest expense component is connecting to an ADSL network i.e the Telkom charges.
One of the problems is abuse by some customers who far exceed the fair use policy.
Goldstuck (World Wide Worx) believes that the concept of abuse is a most abused concept in its own right.
“You can’t declare a fair usage policy without declaring what a fair usage is. The reality is that there is no such thing as abuse if the customer is not given what capacity he is allowed so conditions should be stated. If unlimited access to ADSL is offered and it excludes file sharing than that must be stated upfront.”
Assabi (Digital Solutions) agrees with Goldstuck. “Service providers should utilise technology that allows quality control. If you offer an “eat as much as you like” model, then you will have to charge what your business model dictates. Vermeulen (Tarsus) said that ISPs offering uncapped ADSL offer the service in terms of the speed of the line they are proving so they are actually controlling the amount that can be downloaded.
“If you have a 1 Mbps line you will be able to download more than a person with a 384 Kbps connection.”
Another angle to look at is the shaping of the network, said Kanagratnam (Ericsson), which will limit gaming and file sharing. Today even USA service providers are capping their offering albeit it is at 250 Gbps compared to Telkom’s top offering of 9 Gbps locally. Heavy users typically represent 5% of the user base yet they consume a disproportionately large amount of bandwidth. It is obvious there should be different options for those users.”
It is said that the economic recovery will be led by small business. It is also said that the internet is becoming more and more of a business tool yet we don’t see the level of take up as one would expects. Just the low number of local of online ordering sites attest to this.
The main reason given is the cost of bandwidth. I asked Goldstuck if his research had shown up any indicators.
“On the one hand we see massive uptake of by small business of ADSL and to some extent 3G. Eighty percent of SMMEs connect to the internet via ADSL and a third use 3G as a backup facility,” he said.
“The problem is that they are treated as consumers and in term of quality of service – to go back to Yaron’s earlier point, they need a better quality of service. They cannot use it as a strategic tool as much as they use it as a crucial tool of business because of uncertainty regarding performance.”
There are still problems with international connectivity as was recently illustrated by the extended period that the Seacom cable was out of action. The argument that there is now the EASSy cable and another cable on the horizon does not solve the problem unless service providers enter into restoration agreements.
This means that if disruption is experienced on one cable system the service is automatically rerouted to another cable system without the user even becoming aware of the problem. While this is now available to local ISPs, it is costly.
Currently many service providers have restoration facilities in place bit not to the full extent of having a similar capacity channel on standby. The obvious answer – as alluded to by panel members – is to offer differentiated service packages.
It was inevitable that the Korean model came up in our discussion. Is it not time that government starts walking the talk and subsidises the development of an adequate backbone and last-mile capacity to meet the call for true broadband for all South Africans?
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