State of Online Media in SA

By Arthur Goldstuck

14 August 2008

About World Wide Worx

• Research: – All stats in this presentation from our primary

research into IT and telecoms, Internet, mobile technologies, technology in business strategy

• Key projects: – Internet Access in SA– Digital media in SA– Digital banking in SA– Online Retail in SA– Mobility – consumers, corporates, SMEs– SME Survey: 5 000 respondents annually

Reality check: Internet user base

• 2000: 2 416 000 (32% growth)• 2001: 2 886 000 (20%)• 2002: 3 098 000 (7%)• 2003: 3 283 000 (6%)• 2004: 3.5m (6%)• 2005: 3.6m (3%)• 2006: 3.75m (3%)• 2007: 3.96m (6%)• 2008: 4.4m (8%)

New Reality: The experience curve

Internet users with 5 years experience:

• 2001: 354 700

• 2002: 696 620 (96% growth)• 2003: 1 266 235 (81%)• 2004: 1 820 000 (44%)• 2005: 2 416 000 (32%)• 2006: 2 886 000 (20%)• 2007: 3 098 000 (7%)• 2008: 3 28m (6%)• 2009: 3.5m (6%)

Captured 24 November 2003

Sins of the past

Captured 13 July 2004

Captured 27 December 2004

Reality check: Online retail in SA

• 2000: R82-million• 2001: R162-million • 2002: R252-million (55%)• 2003: R350m (40%)• 2004: R470m (33%)• 2005: R540m (20%)• 2006: R688m (30%)• 2007: R928m (35%)• 2008: R1,2-bn +

6 Years on the Internet:The Experience Curve

New Reality: The Experience Curve

World Wide Worx

Internet users in South Africa, 2008

Online banking customers

Online retail customers

Broadband emerges

Captured 27 September 2006

When mental bandwidth runs out

Source, Internet Access in SA 2007

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

2003 2004 2005 2006 2007 2008

15,70048,000

120,000

223,000

378,000

558,000

03,500

55,200

169,000

450,000

812,000

ADSL vs Wireless Broadband in SA 2003-2008

ADSL

Wireless

Source: Internet Access in SA 2007

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

2003 2004 2005 2006 2007 2008

15,700 51,500

160,000

323,000

658,000

1,070,000

Total unique broadband users in SA, 2003-2008

Source: Internet Access in SA 2007

Online Media in SA survey

First conducted in 20062008 study now under wayWith the cooperation and endorsement of

the Online Publishers AssociationBut open to all online publishersEarly indications suggest massive growthIs the dam breaking?

13 August 2008

13 August 2008

13 August 2008

13 August 2008

Ash can finally afford that drink

Early indicators from new study

The 2003-6 data is based on 2006 studyThe trend lines for 2007-2010 are still an

educated guessBased on numbers provided informally by

key playersFull data available in late September

Key trends predicted in 2006

The emergence of RSS (“really simple syndication”, a relatively new standard delivery protocol for news feeds).

Forecast to rise from 28% in 2006 to no less than 72% in 2008, making it the new killer application of content delivery

Blogs to rise from 24% in 2006 to 56% in 2008

The next revolution

In 2009, the Seacom undersea cable will increase international bandwidth 40-fold

In 2010, this will treble againBandwidth from luxury to commodityFor media, this opens a new world of

possibility, expansion and interactionAdvertising industry has no choice: it must

be there, reboots and all

The big picture

Courtesy Telegeography

The small picture

Courtesy Telegeography

The old picture

1901 Eastern Telegraph Company System Map

The next picture?

Courtesy Steve Song, Many Possibilities

“Sub-saharan Africa Undersea Cables in 2010 – maybe”

Thank youArthur Goldstuck (011) 7827003

arthur@worldwideworx.com

www.worldwideworx.com

Gadget:

www.gadget.co.za

Urban legends blog:

thoselegends.blogspot.com

Business strategy blog

www.thebigchange.com