Press Release:

Foreign Cloud Investment Tips the Balance to Local

Published on: 2019-02-27

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The scale of foreign direct investment (FDI) in the South African Internet in recent months has meant that in-country content is on track to soon exceed out-of-country content.

The localisation of the content accessed by South African web users is helped by major content and Cloud providers building infrastructure located in Africa’s most diversified economy. It points to increasing demand for corporate IT services from South Africa as enterprise workloads go digital. It also suggests that it’s not all doom and gloom out there.

Localisation has been the goal of a 20-plus year investment in South Africa’s Internet Exchanges (INXs) by the country’s Internet Service Providers’ Association (ISPA).

ISPA has for two decades been evangelising the need for its members and others to peer at JINX (the Johannesburg Internet Exchange), CINX (the Cape Town Internet Exchange) and DINX (the Durban Internet Exchange) in order to keep web traffic as local as possible. “Keeping data flows within the borders of South Africa helps drive down costs while pushing speeds up,” says ISPA chair, Graham Beneke. JINX is Africa’s oldest INX.

Bringing Internet content closer to the end web user means pages load faster, video is of a better quality, games are more playable and networking tools are much more effective, amongst other benefits. “The prevailing sense of doom and gloom notwithstanding, South Africa is no small player. This is a middle upper income country with a maturing Internet market richly-endowed with major overseas content players,” adds Mr Beneke. “Together, we have built an impressive Internet market of which we can be justly proud.”

By helping to drive down prices for SA’s web users, localisation is also ushering in a new SA Internet era where uncapped data packages are the norm. In addition, the availability of in-country Cloud-based services like Azure, AWS and Google Cloud are creating new opportunities for innovation by SA businesses in general and start-ups in particular.

Historically, international bandwidth has been the major cost component associated with delivering Internet access. With national / international content ratios changing in favour of local content, the cost of delivering data within South Africa is driven down. “All of this means that local content providers have to up their game, which is ultimately also good for the local web and wider economy too,” says Mr Beneke.

“So many major overseas providers having a presence in SA is good news for the rest of the continent and many other African countries that might not yet have attracted their own Cloud-based infrastructure investment,” concluded Mr Beneke.

Further Information

For further information, please contact the ISPA secretariat on the Contact ISPA page.