A new wireless broadband initiative announced on Monday in South Africa – backed by multi-billion rand investment from several banking and telecoms industry veterans – will offer a data-only network using a next-generation, high-speed data network.
The Multisource Group intends to roll out a new fast LTE Advanced Pro (LTE-A) network, using the 400 sites owned by Wireless Business Solutions (WBS), which it bought last November. Although WBS has been in operation since the early days of cellular networks in the 1990s, its business potential has been stagnant after it made a poor initial technology choice in WiMax, which has since been eclipsed by Long-Term Evolution (LTE) networks.
Multisource’s shareholders include Paul Harris HRS +0.56% (the former CEO of major banking group FirstRand), Michael Jordaan (former CEO of FNB, a division of RMB), Ravi Naidoo (CEO of Design Indaba, a well-known design conference held in Cape Town), a consortium headed up by former MTN CEO Phumlani Moholi, Multisource founder Brandon Leigh, and its CEO, Duncan Simpson-Craib.
“Nothing can be gained by sitting on the sidelines. WBS’ investment is a manifestation of its confidence in South Africa and its desire to contribute” said Harris, who many consider one of South Africa’s greatest entrepreneurs. Harris co-founded the FirstRand Group, one of the country’s big four banks.
Jordaan, a tech-savvy banker who grew FNB into South Africa’s most innovative bank, told me: “The internet is the lifeblood of any economy and democracy. We in South Africa need to get more people connected and those connected must be connected to great service at a good price. South Africa is big country with various areas which will never get fibre. Further we are mobile. There is no fibre jack on your phone. LTE is a great solution to this. The Internet of Things (IoT) is considered to be the next industrial revolution enabling efficient and smart cities as well as creating a platform for innovation. IoT devices required wireless data networks. Our network is very well suited for IoT. The future is everything and everyone gets connected we want to ensure that both of these happen. Via our network South Africa can leapfrog tech and become a leader in this exciting space of internet everywhere and to everyone.”
The launch comes in the midst of the #DataMustFall campaign that is spreading across South Africa, resulting in a parliamentary hearing by the Portfolio Committee on Telecommunications and Postal Services, The campaign was started by radio personality Thabo Molefe, better known as Tbo Touch, who will address the committee on Thursday.
Marian Shinn, Shadow Minister of Telecommunications and Postal Services for the country’s opposition Democratic Alliance (DA), commented: “The lack of availability of spectrum for wireless broadband services is the major cause of high prices. The unavailability of spectrum has created an artificial scarcity that has stifled competition needed to drive down prices.” She was reacting to further delays in licensing LTE spectrum to mobile operators.
“The current United Nations definition of ‘affordable broadband’ is that a 500MB allocation of prepaid mobile data should cost no more than 5% of average monthly income. The Alliance for Affordable Internet (A4AI) stated in its 2015-2016 Affordability Report that in South Africa an affordable internet connection costs the majority of South Africans anywhere between 6-19% of their monthly income,” Shinn said.
Harris added: “There is a direct correlation between access to fast internet and GDP growth, and therefore employment. Data from a recent World Bank study showed that in developing markets, for each 10 percentage point penetration in the population of broadband access, it results in a GDP expansion of 1.4%. This announcement should therefore hearten policymakers, telecommunications regulators and consumers alike”.