Jennigay Coetzer – Business Day – 30 July 2009

The combination of the new undersea cables and the national fibre network being built by Neotel and MTN will enable businesses and consumers to do a lot more with the internet. Initially the new Seacom undersea cable will improve global internet access, and once in place the national fibre network will provide high-speed city to city connectivity, says Arthur Goldstuck, CEO of research firm World Wide Worx.

The network will provide speeds up to 100 megabits per second starting with a link between the Seacom cable landing point in Mtunzini near Richards Bay to Johannesburg. As bandwidth increases it will be more viable for companies to run video conferencing over their networks, allowing users to participate in virtual face-to-face meetings that are as good as the real thing.

Today, most South African companies book video conferencing sessions in a boardroom at a specialist service provider‘s premises, or pay for employees to travel to meetings, both of which are costly and time consuming.

Higher quality connectivity will also allow more applications to be accessed online from data centres located anywhere in the world on a software-as-a-service, and application hosting basis, which are elements of an emerging trend known as cloud computing. Many large companies already use online application services such as user authentication when employees access the corporate network, and third party credit checking.

“But these applications require only small amounts of data to be transferred,” says Goldstuck. He says one of the current arguments against software-as-a-service is the slow and unreliable nature of the existing national and international data communication infrastructure and the resultant network outages.

But the a second national fibre network will provide alternative routing for high-speed data traffic, and with the expected reduction in bandwidth costs it will be more affordable for companies to take advantage of this.

“A big part of the cost of cloud computing is the bandwidth,” he says. As more bandwidth becomes available, users will buy more capacity for the same price as opposed to spending less on data connectivity.

Increased competition will also force operators and service providers to improve their service levels. “But it will take about three years to get all the cables in place and shake out all the cobwebs,” says Goldstuck.

Once this happens, local companies will be able to have applications hosted in offshore data centres in countries where this type of service is a lot cheaper. “This will be a challenge to local service providers,” he says.

On the consumer side, viewing videos on the internet from websites like YouTube and Zoopy and viewing live TV over the internet will become popular pastimes. With more bandwidth, individuals will also be able to generate their own video content and distribute it through YouTube and other websites and blogs, and more local musicians will distribute their music on the internet.

Freelance video makers will also be able to showcase their work and sell their services on the internet, and could pose a threat to traditional video production houses if they gain a following. An increasing number of consumers will also participate in video chat using Skype or similar services on offer from the likes of Google, Yahoo and MSN.

However, the quality of this type of service depends as much on the equipment as it does on bandwidth, says Goldstuck. He says an increasing demand for higher-quality video chat will give rise to improvements in the webcams built into PCs and laptop computers.

Over the next few years IPTV (Internet Protocol TV) capabilities will also enable South Africans to view local TV programs over the internet. “It will take at least five years for IPTV to become a mainstream service.” says Goldstuck.