introduction to bmi-techknowledge portfolio...

Introduction to BMI-TechKnowledge

Portfolio Committee on Telecoms and Postal Services | Cape Town | 14 February 2017

Denis Smit Managing Director [email protected]

@denisbmit

mailto:[email protected]



Portfolio Committee: Today’s objectives

Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T

The presentation should highlight the following issues:

1) The latest trends and developments in the sector and research work which can assist the members to be in a better position to influence policy.

2) The committee will also seek to establish an alignment between research bodies and legislation/policy.

3) The interaction will also seek to assist the members with the latest development and the understanding of its impact on the current and future policies.

3 Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T | Mission statement & competency areas

BMI-TechKnowledge strives to

be a trusted and respected

research and advisory partner

by providing our clients with

valuable information, strategic

advice, and dependable

assistance to help them

implement their strategies

effectively.

IT

Other industries

Geospatial

Telecoms

Digital consumer

Vertical industries

Public sector

CSAT

Insight 27 years in business

Over 2500 projects completed

Unique in the industry

What makes us unique?

Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T 4

Private Sector and Public Sector experience

Combination of research, consulting, engineering and financial skills

Cover IT and Telecoms

Competencies in many areas: The Market

Technical (multiple network layers)

Modelling (technical & financial)

Policy and Regulatory

Spatial analysis

Business & Financial

CSAT and Brand Audits

5 Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T

Advisors to the advisors

Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T

BMI-T team: Consultants and analysts

Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T | BMI-T Team 7

Denis Smit • Managing Director

• B.Sc Elec Eng, MAP, MBA

• Policy

• Public sector and private sector general telecoms

• Project financing and funding models

• Contributor to South Africa Connect

Brian Neilson • Research Director

• B.Sc Elec Eng, MBL

• Business cases and due diligence assessments

• Market analysis, segmentation and forecasting

• Go-to-market strategy

• Technology strategy review

• Policy review

Tim Parle • Senior Telecom Consultant

• B.Sc Electronic Eng, MDP, MBA

• Optical networking (SDH, Ethernet, Microwave)

• Infrastructure (fibre, HV electrical)

• Operations, Modelling, GIS/spatial

• Project Management

BMI-T team: Analysts and researchers


Clinton Jacobs • IT Sector Business Manager

• MBA

• Expertise in ICT research analysis, IT business analysis and Project Management

Selvie Naiker • Senior Research Analyst

• BA (UNISA), Postgraduate Diploma Marketing Management, B.Com Marketing Management

• Expertise in research methodologies

• Quantitative and qualitative research and analysis

• ICT & Telecoms

• CSAT lead

• Project Management

Penny Smith • Secondary Research Analyst

BA (Hons), HD in Librarianship and Information Science

• Desktop research and analysis of national and international case studies

• In--depth interrogation of South African and international statistics and government data

BMI-T team: Associates


Dr Martyn Roetter • Associate Consultant

• PhD Physics (Oxford)

• Over 30 years’ consulting with Arthur D. Little, PA Consulting, Pacomm and BMI-T

• International perspectives on telecommunications policies and practices

Michael Minges • Senior Market Analyst

• Telecommunication Management Group, INC

• Former Head, Telecommunication Data & Statistics Unit, ITU

• Extensive experience in research of ICT trends and statistics

• BA Economics, MBA in Information Systems Technology

Kerron Edmunson • Legal and Regulatory Consultant,

Incyte Consulting

• BA LLB, Diploma in Financial Management

• Solicitor (UK) and attorney (SA)

• Legal drafting

• Policy and legislation development

Latest trends and developments in the telecoms sector Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T

SA ICT spend: R226bn in 2015 (excluding wholesale)

Portfolio Committee on Telecoms and Postal Services | Latest trends and developments in the sector 11

Source: BMI-T IT Services Report, 2015, 2016.. Other category includes Hosting, managed services, leased lines etc.

Business

67%

Consumer

33%

IT

45%

Telecoms

55%

The current state of telecoms in South Africa: Individuals


Source: Stats SA, General Household Survey - 2014, 2015; AMPS 2015B. BMI-T research. Adults are aged 15+ in AMPS’s definition.

54 million

people

More than half of

phones in use

are smartphones

(51%)

34 million adults

have cellphones

(89%)

Nearly 90

million SIM

cards in use

Broadband developments and trends


Source: BMI-T, 2015, 2016.

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

Broadband subscribers

Other

Mobile

DSL

Mobile broadband: 3G and LTE developments


Source: Source: Vodacom reporting, 2011-2016, BMI-T, 2016.

0

100

200

300

400

500

600

700

Average smartphone usage (MB/month)

LTE networks

(base stations)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Vodacom population coverage (%)

GSM 3G / HSPA+ LTE

Telecoms sector Capex


Source: BMI-T, 2016. 2016 figures still to be finalised. Estimate for 2016 is flat at R29bn.

R 0

R 5,000

R 10,000

R 15,000

R 20,000

R 25,000

R 30,000

RSA Telecommunications CAPEX (Rm)

Total mobile networks Total fixed networks

27%

30% 8%

21%

2% 1% 1%

6% 4%

RSA Capex cumulative spend 2011 - 2015

MTN

Vodacom

CellC

Telkom SA

Neotel

Broadband Infraco

Fiberco

Dark Fibre Africa

Others

Fibre developments


Source: BMI-T, 2016

National connectivity


Source: BMI-T, 2016

Submarine cables


Source: manypossibilities.net, 2016; BMI-T, 2016.

10

40

100

200

400

λ Gbps

Liq

uid

Se

a

DA

RE

A

fric

a-1

Metro Municipal fibre networks


Source: BMI-T, 2015

Fibre installed base 613km 940km 300km (?) 500km 1500km

Built (approx) 2010-2011 2012-2013 2006 - 2008 2005 (?) 2005-2015

Dark fibre Yes No No No No

Metro Ethernet Yes Yes No No Yes

P2p wireless Yes No Internal only No No

Wi-Fi zones 290 408 940 700 ~50

Se

rvic

es

Provincial Broadband Networks


Mpulamanga • OOTP driven project • Transaction Advisor appointed in

2015 (Rubo) • PPP under investigation • BMI-T provided technical and

market models including project cost estimation

Limpopo • LEDET driven project • Transaction Advisor

appointed in 2015 (KPMG) • BMI-T provided technical and

market models inputs, • Press reports of some

progress

KwaZulu-Natal • DEDAT / EDTEA driven project • Full broadband study in

2009/2010 resulting in formulation of broadband strategy

• WiFi work in 2016

Western Cape • DEDAT driven project • Conducted multiple broadband

related projects including Connected Government, Connecting Households, Connecting to the World, eEducaiton, Digital Inclusion Feasibility Study and Broadband Skills Framework.

Gauteng • Phase I network built • Phase II under review

FTTH (Fibre to the Home)


Source: BMI-T, 2016. Note: An alternative ‘Low’ scenario exists.

0.00

0.10

0.20

0.30

0.40

0.50

0.60

2013 2014 2015 2016 2017 2018 2019

Mill

ion

s o

f ac

tive

su

bsc

rib

ers

Residential fixed line connections (millions) - ‘FTTH High’ scenario

DSL FTTH

Business internet connections and revenues


1 Excludes mobile SIMs with data used only on a handset. 2 Internet over leased lines (other than FTTP), microwave, satellite, VPN

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Re

ven

ue

(Rm

)

Business high-usage internet revenue1

Other (2) FTTP DSL Cellular and BFW

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2014 2015 2016 2017 2018 2019 2020

Co

nn

ect

ion

s

Business high-usage internet connections1

Other (2) FTTP DSL Cellular and BFW

CAGR 2.3% CAGR 0.5%

2014 2015 2016 2017 2018 2019 2020

Public Wi-Fi initiatives


Wi-Fi on public transport: Planes, trains & automobiles


Source: BMI-T, 2016

What would it take to realise the ambitions of SA Connect?


@B_M_I_T

www.bmi-t.co.za

BMI-TechKnowledge

Core competencies and selected case studies Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T

BMI-T portfolio of ICT Research Reports

Portfolio Committee on Telecoms and Postal Services | Introduction to BMI-T | Core competencies and selected case studies | Informing

Source: BMI-T, 2017 http://www.bmi-t.co.za/reports

http://www.bmi-t.co.za/reports




BMI-T portfolio of ICT Research Reports

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Informing 29

Source: BMI-T, 2017 http://www.bmi-t.co.za/reports





Public Sector consulting

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Public Sector 30

We provide advice, assistance and information both:

About the Public Sector

To the Public Sector

Client base includes:

Ministries

Agencies

Financial institutions

Specialised units

Consulting about the Public Sector


Private Sector and Public Sector experience

Research and Consulting

Cover IT, Telecoms and Postal sectors

Topics include:

Market analysis (segmentation, sizing, forecasting etc.)

Technical reviews and recommendations

Policy review and formulation

Spatial databases and analysis

Analysing the Public Sector

We have detailed analysis of ICT spend in National, Provincial and Local Government

We publish various research publications concerning ICT in Government:

Reports are informed from a detailed analysis of Treasury data and various budgets and IDP votes

No one else has this level of detail or understanding

Vital in understanding the potential size and scope of ICT projects


Relevant skills & experience for Public Sector consulting


We have:

A deep understanding of government networks:

NLD, Provincial, Metro and Municipal

Wired and Wireless including Wi-Fi and associated funding models

Extensive policy experience since 1994

ICT Policy review research advisors

Deep e-Government insight

Direct SA Connect experience

Provided ‘thought leadership’ on NBN’s (wired) and OA LTE

Have conducted the first-of-a-kind review of SA Connect

Our experience with Municipal Networks


Broadband services market study for MTC

Market research for the Tshwance Broadband

Network

Our experience with Provincial Broadband Networks


Mpulamanga • OOTP driven project • Transaction Advisor appointed in

2015 (Rubo) • PPP under investigation • BMI-T provided technical and

market models including project cost estimation

Limpopo • LEDET driven project • Transaction Advisor

appointed in 2015 (KPMG) • BMI-T provided technical and

market models inputs, • Press reports of some

progress

KwaZulu-Natal • DEDAT / EDTEA driven project • Full broadband study in

2009/2010 resulting in formulation of broadband strategy

• WiFi work in 2016

Western Cape • DEDAT driven project • Conducted multiple broadband

related projects including Connected Government, Connecting Households, Connecting to the World, eEducaiton, Digital Inclusion Feasibility Study and Broadband Skills Framework.

Gauteng • Market input to bidders for

the Gauteng Broadband Network

Thought Leadership on WOANs


Determination of demand, coverage & backhaul

White paper and market commentary Spectrum usage

Wireless & optical networking: Recent infrastructure projects

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Advising | Infrastructure projects 37

Monitored, reported and predicted the broadband wireless market since mid-2000s.

Reported on and compiled spatial database of fibre routes in RSA and region since 2008.

Several due diligence projects on mobile voice and VoWireless networks.

Due diligence on evaluation of optical networking tenders.

High-level network dimensioning and design for KZN, WCG and MPU provincial fibre networks. Lead into SIP-15.

BMI-T Bandwidth model used to predict bandwidth demands and market growth for NLD, satellite and submarine cables. Now in 3rd major iteration.

Wireless & optical networking: Recent infrastructure projects


Determination of demand and market value through spatial analysis:

Determination of costs to construct NBN backbone network for National Treasury.

Determination of demand in secondary markets for a NLD player.

Determination of demand in key towns for a proposed national wireless access network (now under constructino).

Metro networks: City of Johannesburg & City of Tshwane

Market research and data collection for the Limpopo provincial wide area network.

FTTH and Gated Communities market sizing and due diligence of business plan.

Infrastructure market: Market research & consulting


Detailed report on size, location, capabilities and usage of data centres in South Africa.

Tracking of deployment count of MNO BTS and modelling of cellular tower count across RSA.

Bespoke study on South African Telecoms & IT Infrastructure: Market and Competitive Analysis.

VSAT market study for state owned operator.

WISP and Wi-Fi market for national opertor.

BMI-T spatial practice

Since 2009, BMI-T has established a core competence in GIS and spatial analysis.

BMI-T has developed a comprehensive spatial database of points, lines and polygons that define telecommunications infrastructure, users and related data across South Africa and Sub-Saharan Africa.

BMI-T has a database of over 50,000km of fibre route and 45,000 end points in South Africa that are current and future users of bandwidth.

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Advising | Spatial analysis 40

GIS and spatial analysis applications include:

Determination and calibration of claimed population coverage & geographic coverage

Determination and calibration of fibre route lengths

Determination of overlap of fibre routes

Determination of coverage requirements.

Design of broadband indices and analysis of same e.g. broadband deprivation index

Determination and prioritisation of demand concentration e.g. points and bandwidth per town

Reasoned geographic apportionment of telecommunications resources and spend.

Sample spatial data sets and analysis


NLD fibre routes NLD fibre routes Determination of demand

Geospatial analysis Private sector demand Public sector demand

SA Connect: Matching technology to location


Source: BMI-T, 2015.

Total 39,000 public sector

demand points

Telkom fibre and exchange network

‘coverage’

Combination




Metro and ruban areas

lend themselves to copper

and fibre coverage i.e.

xDSL and FTTx – ‘more

fixed’.

Rural areas lend

themselves to wireless

coverage: could be fixed

wireless (e.g. WISP) ,

mobile (e.g. LTE) or even

satellite – ‘more wireless’.




0%

50%

100%

School Health Government

Total public sector

More fixed More wireless

-4,000 -2,000 - 2,000 4,000

EC

FS

GT

KZN

LIM

MP

NC

NW

WC

Schools

-900 -400 100 600

EC

FS

GT

KZN

LIM

MP

NC

NW

WC

Health facilities

-4000 -2000 0 2000 4000 6000

EC

FS

GT

KZN

LIM

MP

NC

NW

WC

Government facilities

-10,000 -5,000 - 5,000 10,000

EC

FS

GT

KZN

LIM

MP

NC

NW

WC

Total public sector

Combination of spatial analysis & engineering knowhow


Design of fibre networks to satisfy the requirements of SIP15 and SA Connect

Optimal fibre routing to demonstrate infrastructure gap in South Africa

SA Connect research programme outputs: GIS portal access

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Advising | Spatial analysis

Clients get access to a richer GIS model than the public version.

Customised on-line access to various datasets allows users to form their own views of the data.

Facilities allow for:

Online queries for attribute search and location analysis

Multiple background maps (physical, street layout etc.)

Printing of customised outputs

Password protected access Sample online map is available at;

http://www.bmi-t.co.za/content/geospatial-content-sa-connect-portal

46














SA Connect multi-client research programme headlines

Report published late November 2015 - just ahead of the 2nd anniversary of the release of SA Connect.

Syndicated research programme:

Report was based on extensive primary and secondary research. Hundreds of hours invested.

Subscribers to the report included various public sector and private sector clients.

Deliverables include the 200 page report, Excel model, access to dynamic online maps (GIS) and workshop session.

BMI-T gained media interest with summary findings that were published on our website.

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Advising | Informing 47

Source: BMI-T, SA Connect Research Programme, 2015

Case study: demand study in Limpopo

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Spatial analysis | Demand studies 48

Fibre routes Cellular towers Economic data

Public sector demand

Private sector demand

Outline process • Determine and the demand for each town of

interest by counting points by type • Sum the value • Rank the towns • Consider the difficulty factor of connecting

the town • Consider the commercial services that are

applicable and benchmark against industry pricing

Case study: Access & NLD demand study outputs

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Spatial analysis | Demand studies 49

Selection of towns

Fibre design

Demand per town Revenue per town

3D view of demand

Feed into financial model

Case study: Bandwidth modelling

BMI-T has a bottom-up model that considers the demand per province in RSA plus the aggregated demand per neighbouring country and other important African and sub-Saharan countries

First done in 2010 and calibrated, refreshed annually, 10 year horizon.

Used by several national and international operators for demand and market planning

Matching supply-side model considers the ‘real world’

Scenario driven with intuitive dashboard

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Spatial analysis | Analytics 50

Demand per main route (Gbps) Demand per municipality (TB/month)

Dashboard Pricing

Experience with Wi-Fi including free public Wi-Fi

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Wi-Fi 51

Completed several projects on Wireless Mesh in 2007/8

Due diligence on VoWiFi project in 2009

Connecting Households project for the WCG in 2010

Digital Inclusion Study for WCG (Saldhana WiFi PoC)

WiFi 2.0 report in 2014

Presentations at WiFi Summit 2014 & 2015, WAPA FTWF 2015 and 2016

2015 & 2016 projects related to free public Wi-Fi

Determination of Wi-Fi zones in KwaZulu-Natal (2016)

FTTH experience

Portfolio Committee on Telecoms and Postal Services | Core competencies and selected case studies | Wi-Fi 52

FTTH Council Africa member and research advisor since 2013

FTTH reports in 2015, 2016 and 2017

Characterised and quantified the ‘land grab’

Regular presenters at the FTTH Council Africa conferences

Private sector due diligence work on FTTH operator in 2016

How we can assist the PC on Telecoms and Postal Service

Assist with “fact checking”. Real, research-based evidence - tempered with the reality of “real-world direct telecoms business and experience

Assist with insight into funding realities of rolling-out broadband. Where is the money and how it can be leveraged more effectively?

Independent well informed opinion backed up by 27 years of experience

54

@B_M_I_T

www.bmi-t.co.za

BMI-TechKnowledge

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