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It`s all about infrastructure, says Intekom

By Kerry Botha PR
Johannesburg, 29 Nov 2000

Business is spearheading Internet growth in SA as lack of disposable income continues to inhibit expansion in the consumer sector, says Matthew Roesner, MD of Internet service provider Intekom.

Roesner`s comments are substantiated by Intekom`s annual growth figures. While the increase among dial-up customers has been good - up 25% for the first six months of this year - strongest gains have been made from the business sector, and in particular the small and medium enterprise (SME) community. Revenues from these two sectors have increased by 50% over the prior year.

A recent "State of the Internet" report compiled by the US Internet Council attributes slow Internet penetration in Africa as a whole to poor telecommunications infrastructure and low income.

While the report found SA to be the exception to the rule, the country lags behind other countries in global moves to increase bandwidth to individual customers` homes. This has hindered the wide spread use of net servers, among others, to download large graphics files.

"Digital Subscriber Lines (DSL) and Very Small Aperture Terminal (VSAT), for example, are sophisticated technologies designed to enhance the flow of data into the home and/or small business, and are becoming standard issue to homes in the US," Roesner says.

"These technologies are only now becoming available for corporate applications in SA, let alone implemented for the person in the street.

"Growth of the Internet in SA in essence, is being spearheaded by business. So will DSL and VSAT be the answer for bandwidth-strung South African corporates?

"`Getting nowhere fastest` is the application of these technologies if they are not universally installed with appropriate backbone upgrades and platform redesigns," Roesner says.

Weakest link

"What you have to remember with the Internet is that the weakest point is the weakest link. What VSAT and DSL will do is improve the last mile and provide a robust network link to the corporate backbones. This in itself will generate more efficient data delivery to the premises, especially with the current trend towards data on demand and the emergence of storage hubs and application service provision. They will not help if the network has to access data via a standard dial-up line or if bottlenecks occur in front of the storage platform," he says.

Roesner believes that transaction security is also inhibiting Internet growth. This includes two main aspects, namely communication security and authorisation.

"Without the satisfactory resolution of these issues and a change in the currently negative perceptions about security, financial transactions over the Internet will be limited and growth slower than expected," Roesner says.

The secure electronic transactions (SET) standard, which defines industrial strength authentication, authorisation, confidentiality, accountability, integrity and security management for retail credit card transactions, has been applied in various test cases and its model is starting to be used in part.

"The availability of locally developed 128-bit encryption technology and security through SSL has boosted user confidence. In-roads are being made in Internet commerce, though not at the same rate of growth as the rest of the Internet."

According to Roesner, the issue of security has shifted away from the traditional "firewall for Internet access control" to one that by necessity embraces entire enterprises.

"When it comes to network security, organisations require the ability to define a single enterprise-wide security policy that integrates all aspects of network security. This includes access control, authentication, virtual private networking, anti-virus scanning, URL filtering, and intrusion detection."

He adds that once an overall security policy is defined, companies must be able to distribute it to multiple enforcement points (such as Internet/intranet servers, routers, switches, and hardware encryption devices) to embrace organisational aspects such as global offices, remote and mobile users, business partners and customers.

"A complete enterprise security solution must be able to deliver all this functionality across multiple platforms, without restricting connectivity in any way."

Internet growth

Roesner also believes the development and increasing sophistication of the personal digital assistant (PDA) as well as TV-to-Web connection boxes and smart phones will be instrumental to the continued growth of the Internet world, both in SA and around the world.

"TV and portable access devices will increase the availability of the Internet and will lower the costs of being connected, potentially increasing the number of devices per household. Web on TV will also stimulate demand for Internet-based entertainment," he says.

"These technologies are all on the cards for the South African market. However, the emergence of the PDA will complement existing technologies rather than replace them," Roesner says.

"We are beginning to see the emergence of a more knowledgeable customer. ISP [Internet service provider] size and creative advertising may not be sufficient to retain customers. Rather, ISPs will have to focus on the real issues of the business. Quality of service, peering issues, help-desks, self-help, etc, will become purchase decision factors for customers as they become more experienced users," he says.

Intekom has identified the SME market as a major source of growth and earlier this year launched Inzuzo, a business-to-business Internet portal developed specifically to promote the interests of this burgeoning market sector.

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