Things getting smarter in SA, but people’s mentality still lags

FOR many decisionmakers, the Internet of Things remains a catchphrase without a business case. Clearly, they haven’t been paying attention. IoT sounds hip, but is merely an updated term for machine-to-machine communications, and that was merely an attempt to make old-fashioned “telemetry” sound cool.

One of the clearest pictures of the growth of IoT in South Africa lurks in the last Vodacom interim results, for the end of September 2016, which put a precise number to it: 2.6 million IoT connections on its network. That represents 7.5% of its subscriptions, up from 5.5% just 18 months before.

To paraphrase a famous misquote, a billion rand here and a billion rand there, and soon you’re talking real money. The key to the take-up of IoT services like smart electricity meters, water-leak detection, wildlife tracking, and traffic light management is as old as business itself: the impact on the bottom line.

“If it doesn’t save money or add a huge amount of value, no one in South Africa will buy it,” says Jacques du Toit, CEO of South African connectivity provider Vox Telecom.

“There may be a broader business case, but for our environment, it has to be all about the bottom line.”

As a result, Vox is partnering with the Amdec Group, a property development company, to use IoT both for saving money and adding value in new residential estates.

“We give the basic foundation of a smart home, with Wi-Fi for connectivity, voice over internet protocol for calls, numberplate recognition for the complex. Then we say, in what other areas can we save money and add to residents’ lifestyle? That ranges from electricity and temperature monitoring, to advance water leak detection and enhanced security.

“For example, they put a device on the main water pipe, then do a deal with the insurance company and local plumber. They can say: ‘Because my tenant has put this protective device on, we can be proactive and replace components before a major geyser burst. We are saving you, so we want reduced rates.’

“The developer gets a rebate, the property buyer saves money, the insurance company saves money, the plumber has regular work. Everyone wins.”

The maths shows a typical residential complex can save R1-million a year like this. The penny has dropped for developers such as Amdec, but other pieces of the puzzle are still missing.

“Five years ago developers wanted to own everything. Now they’re realising these partnerships are how they can differentiate themselves. But to get them in place and then get both the insurance company to give a rebate and the plumber to give a discount . . . is proving impossible. The ecosystem still needs to connect.”

Meanwhile, across Africa, the business case is being proved through the humble sim card and machine-to-machine connections.

Stephen Stewart, Africa regional director of global IoT provider Eseye, points out that his company manages close to a million sim cards and growing. Eseye’s biggest advantage is that its sim cards operate across national boundaries, and connect more than 1 000 kinds of devices.

“The region’s beauty as a market is that, while landlines are terrible, GSM infrastructure is excellent,” says Stewart. “Lack of infrastructure and getting around remains a challenge, so IoT is perfect for Africa.”

Goldstuck is the founder of World Wide Worx and editor-inchief of Gadget.co.za. Follow him on Twitter and Instagram @art2gee