Maxwell Technology has launched a new product, Satellite Hot Spot, which has the potential to transform the business model for providing connectivity to under-served communities in townships and rural areas.
World Bank research has shown a direct correlation between broadband penetration and gross domestic product (GDP): every 10% increase in broadband penetration increases economic growth by 1.38%. Broadband rollout is thus perceived as a vital driver of desperately needed job creation in South Africa, which is why it is a flagship project of the Department of Communications.
"However, finding the right business model for low-income areas where computers are in short supply has proved to be difficult," says Kallie Carlsen, technical director at Maxwell Technology. "The problem has always been the high costs of putting in terrestrial infrastructure as against the lower rate of return. Satellite has always seemed to be the best technical alternative but, again, the business model hasn't been right - until now. When we came across this product, we were blown away because it has the potential to turn this sector on its head."
The Satellite Hot Spot product is offered by Sat-Space Africa, a leading provider of reliable and innovative solutions to Africa's connectivity challenges. It uses the AMOS 5 satellite to provide connectivity to even the most remote areas - with only onsite satellite dishes and routers required. The product is aimed at rural entrepreneurs wanting to set up Internet cafes, lodges and hotels situated in remote areas and even wireless operators looking for a stable alternative or addition to their terrestrial infrastructure.
The key, says Carlsen, is the Satellite Hot Spot's innovative billing model. The traditional per-month billing model means the client is charged for bandwidth even if it is not sold on to end-customers.
By contrast, the Satellite Hot Sport uses a router to connect to the Sat-Space billing system, allowing the entrepreneur to purchase vouchers per end-user - in this way, connectivity is only charged for once it is used, effectively creating a prepaid model.
"This billing model is a huge innovation in the satellite business, and we are first to market in Africa," says Shimri Lotan, the sales director of Sat-Space Africa. "We are creating the conditions to make Internet connectivity a reality for those living in remote areas. Every dollar invested in Internet connectivity has an immediate impact on the education, self-development and welfare of users."
"The prepaid approach was pioneered here in South Africa and, one could argue, lies behind the phenomenal growth of our mobile market," Carlsen observes. "I believe that by applying it to satellite connectivity, we are now in a position to change the dynamics of the broadband market in our under-serviced areas. It's all about removing the risk for the resellers of connectivity, be they township/rural entrepreneurs or tourist destinations. The business is always cash-positive and this means it will be in a position to offer a cost-effective product to its customers - and because the cost is based on time and not bandwidth, the connectivity experience will also be superior."
Sources
[1] Yongsoo Kim, Tim Kelly and Siddhartha Raja, "Building broadband: Strategies and policies for the developing world", Global Information and Communication Technologies (GICT) Department, World Bank, January 2010 (p 2). Accessible at http://siteresources.worldbank.org/EXTINFORMATIONANDCOMMUNICATIONANDTECHNOLOGIES/Resources/282822-1208273252769/Building_broadband.pdf
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Maxwell Technology
Maxwell Technology, a subsidiary of Barnstone Corporate Holdings, provides last-mile connectivity solutions. Its experienced team has implemented communication and technology solutions in some of the most remote parts of Africa.
In South Africa, Maxwell has implemented various connectivity solutions in under-serviced areas, which encompass wireless networking solutions for tele-radiology clients and VSAT communication solutions and cabling for many international and South African mining and engineering companies.
Maxwell Technology implements solutions based on combinations of the following technologies: satellite communications, wireless connectivity, networking solutions, VOIP solutions, surveillance solutions and information technology.
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