Growth of Africa’s online mobile and radio community is limited by a low penetration rate
The Internet in Africa is limited by a lower penetration rate when compared to the rest of the world. Measurable parameters such as the number of ISP subscriptions, overall number of hosts, IXP-traffic, and overall available bandwidth all indicate that Africa is way behind the "digital divide". So says NetDynamix CEO, Chris Grant.
Moreover, Africa itself exhibits an inner digital divide, with most Internet activity and infrastructure concentrated in South Africa, Morocco and Egypt.
While the telecommunications market in Africa is still in its early stages of development, it is also one of the fastest-growing in the world. In the last 12 years mobile telephony in Africa has been booming, and is now substantially more widespread than fixed line telephony.
One of the reasons for this is that power availability is still very inconsistent throughout much of Africa, as a result fixed line operators, whether for telecommunications or for the internet users is very unreliable; mobile devices (with their own power source) have enabled citizens to navigate around this impasse with the added benefit of not being tied down to one location.
Telecommunication companies in Africa are looking at Broadband Wireless Access technologies as the key to make Internet available to the population at large. Projects are being completed that aim at the realization of Internet backbones that might help cut the cost of bandwidth in African countries.
The introduction of the WACS and ACE sea cables starting in Cape Town (Melkbosstrand to be specific), following the western continental outline of Africa and extending up to Europe has greatly increased the speed of the Internet throughout Africa whilst at the same time lowering costs for both operators and consumers. The Seacom cable on the East coast of the continent eventually linking with the larger EIG cable in Europe/Middle East has also greatly enabled the growth of the Industry.
In South Africa, the growth of online radio stations in the past few years has been remarkable. Not only are established terrestrial radio stations such as 5fm/Metro/SAFM running established online streams, but also the number of Internet only radio stations has also increased dramatically in just three years; examples include Zone Radio; Biz Radio, 2OceansVibe Radio, Ballz Visual Radio and a number of community radio stations have also begun to stream online; this has vastly increased their ability to reach consumers beyond their broadcasting limit (for example Bush Radio only broadcasts terrestrially in Cape Town, but anyone in the world can listen to their online stream).
One of the major hurdles the industry must overcome is the strain that this large uptake in use of internet services has on established internet infrastructure throughout the continent. Bottlenecks during peak usage time (09:00 to 18:00) greatly slow the speed at which data can be accessed. These fluctuating speeds can be very irritating for both consumers and business alike as one is never sure what speed will be available on what day.
Due to the interconnectedness of networks, a problem in one area of the continent can have adverse effects on connectivity for the whole of Africa. Often when repair work is being done in one area, a fiber optic cable will get cut or damaged, causing problems throughout an entire network.
The digital divide in South Africa can be broken down into two sections; a divide between older/younger South Africans and also between poor South Africans and the middle class/upper class:
Most young South Africans across ALL classes have access to the internet, especially with their mobile phones, this enables penetration of most LSM‘s except those who cannot afford a cell phone. Recently an internet radio station in the Western Cape had over 90% of its listeners accessing through a mobile device of some kind, with a BlackBerry being the most common of connection devices currently.
Where the gap really widens is between older South Africans who are poor and the rest of the country; these older folk do not possess the technological know-how or interest to access these services, unlike their younger grandchildren/children who despite being in lower LSM’s still have that desire and capacity to access the internet and the many services it offers.
The faster internet speed (and cheaper cost of said access) available to both consumers and business has enabled this massive growth in the online market as well as online radio stations; people no longer have to buffer streams as often as they used to, or worry about getting "capped". This is despite the speed variables which can be fixed by both governments/ISP’s building more (and needed) internet infrastructure.
In conclusion, the growth potential of the online market (both radio and mobile) is nearly limitless, as more and more people become acquainted with the services the internet offers due to a decreasing cost and more availability across all LSM’s, so the growth in the market will continue.
Once a critical mass of people have begun to access this medium, so advertisers will flock to those sites that are established players and have growth potential. This will enable websites and especially online radio stations to increase the quality of their product, further reinforcing the positive feedback loop that has already begun to be established.