The coronavirus pandemic has exposed the defects in SA’s digital economy, while paving the way for a fast-paced shift towards digitalisation of products and services offered by government and the private sector.
This is according to a report on the impact of COVID-19 on the state of ICT in SA, compiled by research firm Research ICT Africa.
The devastating impact of COVID-19 turned the spotlight on the state of ICT in SA and created an urgent need for government and the private sector to hasten the shift towards digitalisation in various industries.
Measures to achieve speedier digitalisation should include advancing healthcare services, enabling a conducive regulatory environment, addressing the digital divide in education and tackling ICT infrastructure delays, such as accomplishing SA Connect’s goals todeliver widespread broadband access, notes the report.
“The COVID-19 pandemic is likely to increase the digital inequality that exists in our country, unless it acts as an ‘external shock’ to policymakers and regulators,” says Shamira Ahmed,principal researcher and economist at Research ICT Africa.
“They need to facilitate a more competitive and enabling environment that addresses developmental goals and transforms the South African ICT sector to better facilitate participation in the digital economy.”
Long-overdue infrastructure upgrades which depend on Chinese investment or network equipment across the continent have been further delayed by the global lockdowns, resulting in projects like the national broadband plan and strategy not being implemented.
“The Department of Basic Education’s Strategy 2015-2020 indicates there are policies to facilitate e-learning platforms in SA, but there has been poor implementation in these policies,” she adds.
Dr Charley Lewis, independent analyst and researcher of ICT policy and regulation, points out that with SA’s Internet penetration rate at just over 50% of households, only the privileged few can leverage digital opportunities that ease adherence to social distancing requirements.
“COVID-19 and its consequent litany of lockdowns and social distancing underlined in very stark dimensions the extent of the digital divide in SA.
“The impact of the crisis has been dramatically different for those on opposite sides of that deep divide. For the connected, the pandemic has been eminently survivable. And, for the digitally marginalised, COVID-19 has been an altogether different story.”
According to Lewis, for most of those that do have the small screen of a smartphone as their interface, the cost of data still remains high, despite recent price reductions. In addition, most online content remains in English, a mother tongue to only one in 10 South Africans.
“Blue-collar workers do not have the luxury of working from home: COVID-19 has either cost them their jobs or forced them to work under conditions with greater exposure to the risk of infection. Their children are far less likely to be able to adapt to and adopt e-learning tools, despite the proliferation of zero-rated Web sites,” adds Lewis.
The digital divide aligns with the many social and economic divides, with hundreds of schools, clinics and other government facilities remaining unconnected so many years after democracy, he continues.
Nevellan Moodley, head of financial services technology at consulting firm BDO South Africa, believes repercussions of COVID-19 have left those businesses without a viable digital strategy in dire straits.
“As lockdown levels were lowered we have seen businesses without a digital offering suffer, specifically referencing restaurants that were unable to provide a service utilising digital apps, whereas restaurants operating via these platforms where still able to pull some sort of revenue to cover a portion of overhead costs and salaries,” notes Moodley.
Identifying opportunities
On the upside, Moodley points out that the COVID-19 pandemic has accelerated many sectors’ digital strategies, with local organisations implementing remote working policies and increasingly using video-conferencing technologies such as Skype, Microsoft Teams, Zoom, and voice and screen shares, which have witnessed exponential growth and continue to grow.
“The pandemic shines a spotlight on companies that are thriving as a result of a digital strategy, as their efforts are geared to a digital offering, and as such, they have embraced e-commerce and have quickly adapted to life in the pandemic. The crisis has also presented a great opportunity for SA to take advantage of its digital skills – we are already seeing an increase in the number of foreign countries that are outsourcing development to SA,” adds Moodley.
Dobek Pater, MD of research firm Africa Analysis, says while there are fractures in SA’s digital economy, COVID-19 has led to the acceleration of some digital initiatives, including the Independent Communications Authority of South Africa assigning emergency temporary spectrum to local telcos in April.
“The private sector and government are trying to do their best under the current situation; years of poor policies, neglect and mismanagement cannot be rectified quickly.
“For example, the issuing of the high-demand spectrum, which should have been auctioned off to the operators a number of years ago. This would have allowed them to provide more extensive broadband services, very likely at a lower cost to the user than at present.
“The SA Connect programme has been a dismal failure to date. Had it been on track, we would have had better broadband infrastructure in place and been better able, as a country, to deal with the COVID-19 crisis from a socio-economic perspective.”
Ahmed states that the lockdown resulted in many brick-and-mortar stores to adopt online alternatives, which is expected to propel online shopping trends.
“For the privileged few, the accelerated adoption of e-commerce has alleviated lockdown and social distancing measures required to contain the COVID-19 pandemic. This could potentially create long-term impacts that contribute to future job creation and inclusive economic growth in SA,” notesAhmed.
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