Home fibre is transforming employment prospects in South African townships, helping residents find better jobs, start businesses and participate more actively in the digital economy.
This is according to new research from the Bureau of Economic Research (BER), which is publishing three papers on the relationship between affordable fibre-to-the-home (FTTH) and socio-economic benefits in townships.
It conducted surveys over several periods in Kayamandi, just outside Stellenbosch, with the first undertaken in August 2022, another in late 2023 and then early this year.
The name “Kayamandi” translates to “nice” or “sweet home” in Xhosa. The township dates back to 1966, when the nine largest employers in the Stellenbosch district – including Stellenbosch University, the town administration, several vineyards and a fruit packing company – united to erect 38 ready-made homes, so-called hostels, to house black migrant labourers, non-profit Songo says on its website.
Songo adds that these inadequate housing solutions and other Apartheid-era segregation policies left the community with poor educational facilities and infrastructure and, as a result, limited economic opportunities.
Yet, home fibre in Kayamandi has a meaningful impact on economic participation, specifically helping workers transition into more stable jobs. This is a finding of the second of BER’s three papers, released yesterday under the title: “Fibre connectivity and economic participation in a South African township”.
The research is supported by Nokia, Heineken and Lesaka Technologies.
However, BER says fixed broadband may not be a substitute for addressing South Africa’s deeper structural barriers to employment, such as skills shortages that keep unemployment persistently high.
According to BER, only 2.7 million of South Africa’s roughly 18 million households have a fibre-to-the-home connection. “Most households beyond the reach of fibre networks rely on mobile data, which can make data-intensive tasks like online learning, remote work, or running a business prohibitively costly.”
In comparing the costs of mobile broadband with FTTH, BER said: “The difference between mobile and fibre broadband is analogous to bottled versus tap water. Each serves its purpose, but it quickly becomes expensive if you need to water a tree with Valpré.”
Lowering the connectivity cost increases he likelihood of people participating in the economy, BER finds. In addition, the bureau’s research found a causal relationship between home fibre and adults using the internet for learning, such as research, educational sites and classes.
Residents leveraged fast and affordable internet to find better or alternative work, and start or expand micro-enterprises, whether selling goods, offering services, or pursuing other entrepreneurial endeavours, says BER.
In an earlier paper, BER investigated the impact of FTTH on online behaviour in Kayamandi and found that the rollout of affordable fibre broadband reshaped how residents connect, communicate and participate in the digital economy.
This paper, “The impact of fibre broadband on online behaviour in a South African township”, says that “over the course of three years, a community that had previously relied almost entirely on mobile data transitioned to using fibre”.
BER’s first report also notes that “our findings show that fibre access not only changed what people buy but also how they use the internet. Specifically, respondents with home fibre had a higher likelihood of using the internet for learning.”
FTTH also appears to have lowered the implicit cost of job search among persons who were already employed, suggesting that home fibre allowed them to use the internet to find better or alternative opportunities, says the bureau.
“Our results suggest that fibre priced at a level aligned with township household budgets enables shifts from internet-use focused predominantly on communication, to more productive activities without increasing total connectivity spending,” BER says.
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