Good year ahead for IT sector

Candice Jones
By Candice Jones, ITWeb online telecoms editor
Johannesburg, 02 Jan 2008

SA's changing broadband access and affordability may facelift the local IT industry in 2008, say analysts.

Steven Ambrose, MD of Strategy at World Wide Worx, predicts the price of broadband in the country will come down this year, giving South Africans the opportunity to use online services and IP-based solutions.

"The caps will be significantly increased and new technologies like WiMax and the entrance of Neotel, Vox Telecom, and others into the telecommunications arena, may give all of us a taste of real competition and real access to choice in the telecommunications arena."

He says while WiMax is still in the test phase for most companies, World Wide Worx expects growth in this area as well as other wireless options such as HSDPA and iBurst. "ADSL will continue to grow from about 378 000 to 600 000 connections, but wireless will double from 418 000 to a predicted 820 000 in 2008.

"Neotel will also be offering a consumer and small business wireless iPhone and Internet bundle in the first part of 2008, and this will add to the growth of wireless connections as well."

He says the changes in broadband will dictate the way South Africans will respond to the international trends for online services such as Windows Live and Google. "The battle for Web-based user experience is something that's going to continue to grow, especially as the 'cloud' takes over more."

Paul Booth, director of Global Research, says in line with the growth of broadband options, software as a service is expected to show over 20% growth this year.

Mobile madness

The mobile sector is expected to continue to show the greatest advancement, according to Lindsey McDonald, ICT industry analyst at Frost & Sullivan, as subscribers make greater use of their mobile devices with a plethora of new services on the market.

"Location-based services on mobile phones are also likely to become more mainstream," she says. "Vodacom's launch of its grid service late last year is one of the earliest indicators of this trend. The tie-in with user-generated content based on one's location is expected to become a reality as well."

McDonald adds that IP convergence will play a large role in the industry in the coming year. "Mobile providers are becoming content providers, and content providers such as News24 are really taking hold in the Internet space. IP has played a large part in these movements and will definitely be in the foreground of the IT industry this year."

World Wide Worx's Ambrose includes in this trend the growing commercial aspects of the mobile market, with companies like Vodacom taking advantage of the platform as advertising space. "Mobile banking will also grow at an increasingly fast rate; the current penetration is at about 26% in SMEs and corporates and we expect this to grow to over 35% in 2008. "

He says the lowering cost of Internet-enabled devices and mobile Internet access are vital in their impact on the industry. "The overall growth of applications such as e-mail and Web browsing and mobile commerce will also emerge as significant forces in 2008. This trend is strongly allied to the cost of advanced mobile devices coming down by 40%."

Smart business

Analysts agree that collaboration trends brought on through mobile business and more accessible Internet is impacting on the growth of business intelligence in SA.

"Businesses are realising the value of these software tools as an increased portion of the workforce becomes mobile. The South African business sector has to play catch-up with its European and American counterparts in this regard, but will continue to shape trends for the African continent," says MacDonald.

Booth expects the governance of these solutions to increase by about 15%. "Governance solutions also include areas such as e-mail archiving, document archiving and security," he says.

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