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Connecting Cape Town



            Brian Pinnock




        Monday, April 19, 2010
Agenda – Connecting Cape Town


 • What is broadband connectivity exactly?


 • What it costs to connect a broadband user
...
Introduction – Why is broadband connectivity important?

• Broadband Projects 1% extra GDP


• Digital cities initiatives ...
What is broadband connectivity exactly?

 • Fibre Optic Cable


      • International


      • National

      • Metropol...
What it costs to connect a user from Cape Town


           ISP Operations 6%

 IPC 12%                                   ...
Connecting Cape Town to the World

                                       International traffic flows 2009




 6   © Copy...
Connecting Cape Town to the World

                                       Global Undersea Cable Systems 2010




 8   © Co...
Connecting Cape
  Town to the world

• Many cables planned
• Both East and West
  coast
• Land locked countries?
• Operati...
Connecting to Africa is slow
                                  The “African” issue



                               • Nor...
Connecting Cape
   Town to Africa

• Many terrestrial cables
  planned
• Mostly East coast
• Last mile still a problem
Connecting Cape Town to South Africa

                                  • Legacy network
         Telkom
                 ...
Connecting Cape Town to itself (Last Mile)


                                   • Built, lit and operating
     Ethekwini ...
Implications


                                        Threats                 Opportunities




                         ...
Connecting Cape Town



            Brian Pinnock




        Monday, April 19, 2010
Diginet Price Trajectory




18   © Copyright Dimension Data 2010   19 April 2010
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Connecting Cape Town\Bandwidth Connections by Brian Pinnock

  1. 1. Connecting Cape Town Brian Pinnock Monday, April 19, 2010
  2. 2. Agenda – Connecting Cape Town • What is broadband connectivity exactly? • What it costs to connect a broadband user • Connecting Cape Town to the world (and Africa) • Connecting Cape Town to South Africa • Connecting Cape Town to itself • Implications for Cape Town & business in Cape Town 2 © Copyright Dimension Data 2010 19 April 2010
  3. 3. Introduction – Why is broadband connectivity important? • Broadband Projects 1% extra GDP • Digital cities initiatives worldwide • E-Government enablement • Foundation for virtual working • Foundation for virtual services • Enabler – business, education,… 3 © Copyright Dimension Data 2010 19 April 2010
  4. 4. What is broadband connectivity exactly? • Fibre Optic Cable • International • National • Metropolitan • Other last mile • Copper • Wireless 4 © Copyright Dimension Data 2010 19 April 2010
  5. 5. What it costs to connect a user from Cape Town ISP Operations 6% IPC 12% International Bandwidth 12% Last Mile Bandwidth 70% 5 © Copyright Dimension Data 2010 19 April 2010
  6. 6. Connecting Cape Town to the World International traffic flows 2009 6 © Copyright Dimension Data 2010 19 April 2010
  7. 7. Connecting Cape Town to the World Global Undersea Cable Systems 2010 8 © Copyright Dimension Data 2010 19 April 2010
  8. 8. Connecting Cape Town to the world • Many cables planned • Both East and West coast • Land locked countries? • Operating models are key
  9. 9. Connecting to Africa is slow The “African” issue • North African reasonable • Central Africa terrible • High latency = satellites • High latency reduces your options (especially voice services)
  10. 10. Connecting Cape Town to Africa • Many terrestrial cables planned • Mostly East coast • Last mile still a problem
  11. 11. Connecting Cape Town to South Africa • Legacy network Telkom • NGN • Major centers connected Neotel • Duopoly pricing • Neotel, MTN , Vodacom & SANRAL cost sharing joint venture Joint Venture • Own use priority • Spare capacity to sell • Fiber systems from Transtel & Eskom Broadband • Carrier of carriers Infraco • Sentech or saviour? Implications for • Short term – major centers vs. small towns business • Medium term – competition may drive prices down further 14 © Copyright Dimension Data 2010 19 April 2010
  12. 12. Connecting Cape Town to itself (Last Mile) • Built, lit and operating Ethekwini Metro • +-1/3 of incumbent operators pricing Johannesburg • POC phase complete Metro • Not operating yet • Physical fiber rollout at an advanced stage Cape Town • Switching centres go live in July Metro Broadband • Unclear on costing/pricing model and final ETA unknown • Dark Fiber Africa – Internet Solutions (IS Fiber) Other Metro • Incumbent telecoms operators – Metro Ethernet Broadband • SANREN Last Mile • Wireless (3G, 4G, CDMA, WIMAX) Competition • Copper (Local loop unbundling) 15 © Copyright Dimension Data 2010 19 April 2010
  13. 13. Implications Threats Opportunities • International connection Competition • National backbone connection needed • Last mile connection most important • Offshoring -Legal, financial, contact centres, creative industry Opportunities • Expansion into Africa • Attract talent – work from anywhere for anyone • Low cost geographies taking jobs from Cape Town Threats • Low cost competitors selling services into Cape Town (Google) • Digital ghettos 16 © Copyright Dimension Data 2010 19 April 2010
  14. 14. Connecting Cape Town Brian Pinnock Monday, April 19, 2010
  15. 15. Diginet Price Trajectory 18 © Copyright Dimension Data 2010 19 April 2010

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