Connecting Cape Town\Bandwidth Connections by Brian Pinnock

Tuesday, April 11, 2023

Connecting Cape Town

Brian Pinnock

2 © Copyright Dimension Data 2010 April 11, 2023

Agenda – Connecting Cape Town

• What is broadband connectivity exactly?

• What it costs to connect a broadband user

• Connecting Cape Town to the world (and Africa)

• Connecting Cape Town to South Africa

• Connecting Cape Town to itself

• Implications for Cape Town & business in Cape Town

3 © Copyright Dimension Data 2010 April 11, 2023

Introduction – Why is broadband connectivity important?

• Broadband Projects 1% extra GDP

• Digital cities initiatives worldwide

• E-Government enablement

• Foundation for virtual working

• Foundation for virtual services

• Enabler – business, education,…

4 © Copyright Dimension Data 2010 April 11, 2023

What is broadband connectivity exactly?

• Fibre Optic Cable

• International

• National

• Metropolitan

• Other last mile

• Copper

• Wireless

5 © Copyright Dimension Data 2010 April 11, 2023

What it costs to connect a user from Cape Town

IPC 12%

ISP Operations 6%

International Bandwidth 12%

Last Mile Bandwidth 70%

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Connecting Cape Town to the World

International traffic flows 2009

8 © Copyright Dimension Data 2010 April 11, 2023

Connecting Cape Town to the World

Global Undersea Cable Systems 2010

Connecting Cape Town to the world

• Many cables planned

• Both East and West coast

• Land locked countries?

• Operating models are key

The “African” issue

• North African reasonable

• Central Africa terrible

• High latency = satellites

• High latency reduces your options (especially voice services)

Connecting to Africa is slow

Connecting Cape Town to Africa

• Many terrestrial cables planned

• Mostly East coast

• Last mile still a problem

14 © Copyright Dimension Data 2010 April 11, 2023

Connecting Cape Town to South Africa

• Legacy network• NGN

• Major centers connected• Duopoly pricing

• Neotel, MTN , Vodacom & SANRAL cost sharing joint venture• Own use priority• Spare capacity to sell

• Fiber systems from Transtel & Eskom• Carrier of carriers• Sentech or saviour?

Telkom

Neotel

Joint Venture

Broadband Infraco

• Short term – major centers vs. small towns• Medium term – competition may drive prices down further

Implications for business

15 © Copyright Dimension Data 2010 April 11, 2023

Connecting Cape Town to itself (Last Mile)

• Built, lit and operating• +-1/3 of incumbent operators pricing

• POC phase complete• Not operating yet

• Physical fiber rollout at an advanced stage• Switching centres go live in July• Unclear on costing/pricing model and final ETA unknown

Ethekwini Metro

Johannesburg Metro

Cape Town Metro Broadband

• Dark Fiber Africa – Internet Solutions (IS Fiber)• Incumbent telecoms operators – Metro Ethernet• SANREN

Other Metro Broadband

• Wireless (3G, 4G, CDMA, WIMAX)• Copper (Local loop unbundling)

Last Mile

Competition

16 © Copyright Dimension Data 2010 April 11, 2023

Implications

Threats Opportunities

• International connection• National backbone connection• Last mile connection most important

• Offshoring -Legal, financial, contact centres, creative industry • Expansion into Africa• Attract talent – work from anywhere for anyone

• Low cost geographies taking jobs from Cape Town• Low cost competitors selling services into Cape Town (Google)• Digital ghettos

Competition needed

Opportunities

Threats

Tuesday, April 11, 2023

Connecting Cape Town

Brian Pinnock

18 © Copyright Dimension Data 2010 April 11, 2023

Diginet Price Trajectory