Bandwidth keeps SA down

By Siyabonga Africa, ITWeb junior journalist

Johannesburg, 23 Sept 2008

Local bandwidth problems hinder SA's ability to become a global competitor in IT, says the Business Software Alliance (BSA).

SA was ranked 37th out of 66 countries in the 2008 IT industry competitiveness index, according to a study conducted by the BSA's Economist Intelligence Unit. Its position has not changed since last year.

"Bandwidth is an area that deserves a big tick for improvement," says BSA SA chairman Alastair de Wet. "A competitive broadband market is needed to support a competitive IT market and we simply don't have a world-class broadband infrastructure."

De Wet explains that companies in developed countries expect good broadband services in countries where their international offices are located. He also says the local cost of bandwidth is disproportionate to that in international markets. "A BSA member once said his bill for bandwidth after one month was the same as the price of a low-entry vehicle."

Strengths, weaknesses

De Wet says SA's key strength lies in its strong business and legal environment. He adds that government support for IT industry development is also a bonus point on SA's ranking.

A key area for improvement is the country's IT infrastructure, where the provision of high-quality networks and greater liberalisation of telecommunications is needed.

"Few countries can hope to build strong IT production sectors without strong business and legal environments, deep pools of talent, support for innovation, and the widespread use of technology throughout society," maintains Denis McCauley, Economist Intelligence Unit director of global technology research.

De Wet is adamant SA's greatest strength in IT lies with its people. This is despite reports by the Department of Trade and Industry that there is a lack of skills in the local IT industry. "I believe in the potential of the people and I really believe that, as a nation, we have been generally creative in times of economic turmoil," he adds.

Other key findings

The study shows three new countries - Taiwan, Sweden and Denmark - have joined the US and the UK as the top five IT competitive countries.

"This year's index shows that a country's IT competitiveness rankings can move upward or downward very quickly," says De Wet.

The study also found that investing in people is critical for domestic IT industries.

It noted that competitive broadband markets help cultivate strong IT sectors: without fast, reliable and secure Internet access, technology firms cannot interact effectively with partners and the research community, nor can they sell their services online.