Poor connectivity stifles SaaS

By Alex Kayle, Senior portals journalist

Johannesburg, 07 Aug 2009

Low Internet penetration has a negative effective on the adoption of software-as-a-service (SaaS) in SA, said Mark Slingsby, technical director of RSA Web.

Slingsby revealed during this week's ITWeb SaaS conference, that SA is three years behind the US and UK in terms of Internet advancement. High telecommunications costs and low broadband infrastructure are inhibiting the roll-out of feature-rich SaaS solutions to businesses.

“Traditional Web-based SaaS models don't reach all players. The big market from a SaaS perspective is in the mobile market via mobile banking and SMS short code services.

“Pre-2006, we had dial-up where reliability was bad; it had low capacity and was very expensive. We now have 4Mbps, better reliability and international capacity improving due to international undersea fibre optic cables coming in. However, even with Seacom we are not going to see much difference in costing in the short-term,” added Slingsby.

He suggested businesses are spending large proportions of their financial budget on hosting the solution, instead of investing in business application improvements.

Peter Flynn, MD of White Wall Web, who spoke about implementing an effective SaaS strategy, pointed to the five-year experience curve. He noted the uptake of Internet users is increasing sharply due to increasing Internet accessibility, but by 2013, this trend will start to flatten out.

“Internet usage is a double-edged sword because of bandwidth costs and support. The business budget ends up being spent on bandwidth costs and support instead of improvements. This decentivises the SaaS user.”

Flynn added: “The Web has matured and HTML 5 is coming out. SA has the world's second highest mobile phone penetration and as SaaS strategists we should have mobile planning in our strategy.”