Biggest tech triumphs and failures of 2015 in South Africa

This past year saw both great wins and significant failures in South Africa’s technology and telecommunications sectors.

Most significant is that after all these years, precious spectrum which could be used for the roll-out of Long Term Evolution (LTE) services still lies unused.

Some good news in 2015 was seeing the effect of community-driven fibre-to-the-home projects being rolled out in more affluent suburbs across South Africa.

While this doesn’t compensate for the lost opportunity of the unassigned LTE spectrum, it did take out some of the sting.

Listed below are some of the biggest victories and failures of 2015 in South African tech and telecoms.

FAIL: High demand spectrum for LTE continues to lie dormant

The biggest failure of the past year is government still dragging its feet to provide telecommunications operators with spectrum.

Missing the digital TV deadline goes hand-in-hand with this failure.

WIN: The rapid roll-out of FTTH has begun

Arthur Goldstuck, industry analyst and managing director of research firm World Wide Worx, listed the beginning of rapid roll-out of fibre-to-the-home (FTTH) as South Africa’s biggest tech win of 2015.

“While it will initially be accessible only in higher-income groups, we are at the point with this technology where we were with ADSL 12 years ago. It will become pervasive,” said Goldstuck.

FAIL: Altech Node

Another significant failure this year was the Altech Node, Goldstuck said.

Launched in September 2014, the Node was Altech’s satellite-based push video-on-demand (VOD) and home automation platform.

Over-complicating the system and service is partly what caused the Altech Node to fail, Goldstuck said.

It offered a subscription VOD service for R299 per month, which was significantly more expensive than the online options available, as well as movie rentals.

By August 2015 Altech had confirmed that the Node was dead and would be shut down at the end of October. Subscribers would be refunded.

WIN: Video on demand

Despite the failure of the Altech Node, 2015 was a good year for South Africans hoping that solid on-demand video offerings would become available locally.

“The takeoff of video-on-demand is initially going to happen off the back of FTTH,” Goldstuck said. That is why the rapid roll-out of FTTH is a far more significant win than the local VOD services themselves, he argued.

Significant developments in South Africa’s video-on-demand space this year included:

• Netflix confirming plans to launch in South Africa by the end of 2016. Talk in the industry is that Netflix will be launching in South Africa during January 2016.
• The launch of a Netflix contender from Naspers called ShowMax,
• launch of PCCW’s OntapTV,
• disinvestment of Tiso Blackstar in Times Media Group’s Vidi,
• rebranding of MTN FrontRow to VU, and
• Vidi and VU’s reduction of subscription fees to R99 per month.

FAIL: MTN’s massive R59.7-billion fine, and its other corporate governance disasters in Africa

A final failure Goldstuck highlighted was MTN’s corporate governance disasters across Africa, which he said will translate into lower profits, and therefore less to invest in future infrastructure.

“Foreign chickens will come home to roost,” Goldstuck said.

Also read: MTN’s R59.7 billion Nigerian fine deadline contradiction