

Huge implications for Internet startups in South Africa - jrgnsd
http://blog.compl33t.com/huge-implications

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f3
It is interesting to see South Africa's two biggest rent seeking industries
(telecommunications and banking) covered in one post :-)

Things are changing, but there are issues that more undersea cables and a tiny
opening in the banking system won't be able to fix.

You still have to pay Telkom for a voice land-line, and that adds to the cost.
It can still take months to get a land-line, and waiting for an ADSL
connection is also a problem, so many people don't bother.

Telkom remains a de-facto monopoly for fixed lines (Neotel's current offerings
still seem to be wireless, and of variable quality), and the South African
government needs to be even more aggressive IMO in undoing the disaster of
Telkom's mid-90's state-granted monopoly, and it also needs to take a tougher
regulatory line with mobile providers. I'll really start celebrating when
cheap uncapped wireless/3G becomes available at reasonable rates.

PayPal is also a good start, but the terms and conditions are strict. You
can't leave the money in your PayPal/FNB account for longer than 30 days, and
all transactions need to be reported to the Reserve Bank for exchange-control
purposes through the FNB website. There is also a prohibition against
"bulking", so I guess you may need to report and withdraw money for each
transaction individually, meaning higher fees (see above point about rent
seeking).

On a related note, exhange controls are a relic of the past, and should have
gone years ago. Even though for the average person they are moot (the offshore
allowances are now quite large) the amount of regulatory pain they put one
through is deeply disruptive. I recall an former employer needing excon
permission to purchase a developer suite from overseas - not the way to be
part of the hi-tech global economy.

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compl33t
All very valid points that I didn't mention in my post. Would you mind adding
this comment to the original post to add some insight? :)

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rezrovs
I'd also like to comment on the original article but I need to have a twitter
or posterous account of which I have neither.

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helium
The price war that mweb started when they launched their uncapped ADSL
offering is indeed a huge deal at the moment.The fact is, SA has a HUGE
population that's never been exposed to broadband internet since it's just
been too expensive. If broadband suddenly gets affordable there is a chance of
a tech mini-bubble emerging here a couple of years late.

But will we see a xhosa social networking site soon? Who knows.

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f3
It's not so much social networking sites that would be great, but the
possibility of free interactive education. The quality of teaching that most
(poor and black) South African school children are subjected to is shockingly
poor.

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helium
As much as I agree with you, that is not where the cool stuff will happen. Sad
as it may be, innovation on the web has never really been centered around
education. And as far as the goverment is concerced, I don't think that smart
ways of using technology to improve education are on the cards soon.

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nivals
The talent and ingenuity of South African developers has been limited for
years due to the 'tariffs' on international bandwidth. The removal of
bandwidth caps is a step in the right direction.

I agree, the last-mile has not been the biggest problem given that there are 6
mbit ADSL lines available at rates on par with major US metro areas.

I would love to see a large WiMAX/LTE tower installed on top of Sandton City
(and throughout Gauteng) to bring 20+ mbit wireless internet to the CBD.

Happy to see PayPal entering the South African market even if SARS wants to
see all the transactions.

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maxklein
The hundreds of billions of dollars made when mobile phone networks started
operating across most of Africa could be repeated with internet services.

However, it is my understanding that internet at the moment across most of
Africa is trending towards UMTS and another wireless technologies that
leverage the existing towers built for mobile access.

A single such tower covers a far wider area and is much cheaper to install and
maintain than broadband cables. Also, factoring in that Africa is not very
densely populated, I would think that wireless makes sense over wired.

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jrgnsd
This might be true for some areas in Africa, but there are areas such as
Gauteng which are quite densely populated, and already have extensive copper
and in some places fibre networks. The only problem is that access to these
networks are still quite expensive.

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f3
There are some areas in Gauteng where Telkom lines remain heavily rationed.
Factor in the risk of copper theft and consequent reliability issues, and
wireless is very attractive.

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harrysa
As a south africa developer, I can just express my excitement about all the
things happening in SA atm. We will see allot of new and exiting start ups. It
has now been made easier. So this is big fir us! happy

