The South African cloud market continues to experience significant growth as both large enterprises and SMEs migrate their workloads to the cloud. Key infrastructure providers such as Microsoft and Teraco continue to invest significantly in cloud and data centre infrastructure respectively, to cater to the increasing demand for cloud services. Through the use of independent software vendors (ISVs), many local organisations have started establishing their cloud journeys to ensure a smooth transition to the cloud environment.
Key Highlights of the Conference
The 2019 Cloud Conference was held in Johannesburg on 6 June 2019. The event featured several cloud providers, including Huawei, Liquid Telecom, Microsoft, Oracle and VMware. Furthermore, data centre providers such as Teraco also featured, and highlighted their ongoing expansion projects and key milestones achieved to date.
Most service providers highlighted the different cloud journeys being developed by customers to ensure successful migration to the cloud. These cloud journeys vary from service provider to service provider. The overarching themes by most service providers include planning, migrating and modernising / extending the cloud environment. The overall objective is to establish the best migration strategy that minimises costs and optimises return on investment.
Key highlights at the conference included the upsurge, evidenced by the service providers, in the demand for cloud services in the country, particularly by SMEs and start-ups. Microsoft is currently experiencing significant interest in cloud services from start-ups that mostly utilise artificial intelligence (AI) and machine learning (ML) solutions.
However, skills shortage remains a key challenge, as it is negatively affecting the development of the cloud market. Hence, partnerships between service providers and ISVs have played a key role in addressing the skills gap.
Huawei is aggressively marketing its cloud offering, which includes Huawei Cloud, Huawei Cloud Stack Online and Huawei Cloud Stack.
Teraco’s data centre services have experienced significant growth due to the increased demand for cloud services. It is currently expanding its Isando campus to about 12 000m2 by Q3 2019, at a cost of R900 million.
Cloud Migration Journeys by Service Providers
The cloud migration journey involves three broad stages, namely: planning, migration and modernisation / extension. Various service providers recommend specific migration strategies to their customers.
The overarching objectives in establishing the cloud migration journey include:
- Identifying gaps between existing legacy architecture in the organisation and next-generation cloud architecture.
- Mitigating risk by validating critical elements of the proposed architecture.
- Identifying the architecture that minimises capital expenditure on IT infrastructure.
- Establishing the best migration strategy, e.g., ‘forklift’ migration, which involves moving workloads in their existing state, or hybrid migration, which involves moving applications in batches to ensure a smooth transition.
- Implementing advanced monitoring and telemetry strategies to optimise the cloud platform.
Liquid Telecom’s migration strategy for its clients is segmented into three phases: planning, migrating and managing. These phases entail defining a company’s cloud journey before migrating and maximising value through the cloud platform.
Microsoft’s cloud migration strategy is segmented into assessment, migration and optimisation of the cloud platform. The objective of this strategy is to establish inclusiveness, involving various stakeholders within the organisation, to ensure a successful migration strategy.
IBM’s migration strategy involves enabling cloud-native, integration and modernisation of the cloud environment.
Other cloud providers, such as Amazon Web Services (AWS), have an extended cloud migration strategy that includes assessment, concept development, migration, cloud leveraging and optimisation. However, the underlying objective of identifying the best migration strategy remains the same.
Huawei’s Cloud Solutions
Currently, Huawei offers private cloud, hybrid cloud and public hyperscale cloud solutions. Its cloud services are categorised into three types, namely: Huawei Cloud, Huawei Cloud Stack Online (HCS Online) and Huawei Cloud Stack (HCS).
- Huawei Cloud is a full-stack platform that includes IaaS, PaaS, Security, Database, Big Data, and Enterprise Intelligence (EI) services.
- HCS Online is an extension of Huawei Cloud in customer data centres. This cloud type uses a similar architecture and provides the same cloud services as Huawei Cloud – IaaS, PaaS, Security and Database services. The only difference is that it is deployed in customers’ data centres and provides isolated resources to ensure security compliance.
- HCS is Huawei’s full-stack hybrid cloud solution that includes IaaS, PaaS and Desktop-as-a-Service (DaaS) offerings. In addition, it supports hybrid cloud architecture, including Huawei Cloud, AWS and Azure.
Despite these three cloud types having different features, they all share unified architecture, ecosystem and user experience. Huawei Cloud and Huawei Cloud Stack Online also share unified APIs, Cloud services and Operations & Maintenance services.
Huawei’s cloud portfolio offers an open application platform and provides powerful cloud infrastructure that supports AI services. Furthermore, its security solutions are aimed at controlling data access through data warehouse security. Data security is achieved through data and network channel encryption.
Microsoft’s Cloud Migration Considerations
Microsoft SA detailed some of the key points that organisations need to consider before migrating to the cloud, which include their existing budgets, industry legislation around data residency, service level agreements (SLAs) by various service providers and the existing skills set within their organisations.
Organisations need to extensively assess their current IT budgets to establish their affordability before they embark on their cloud journey. This will enable companies to create a cloud environment that best suits their needs and realise the highest return on investment.
The process of migrating to the cloud needs to be carefully managed to allow for a smooth transition and ensure all employees are familiar with the processes. ISVs have played a critical role in partnering with Microsoft to develop and deliver successful cloud migration strategies.
However, the upscaling of existing skills within organisations remains a key priority to ensure the modernisation and extension of the established cloud environment.
The ability to leverage existing infrastructure is a key consideration that could result in significant cost-saving during the cloud migration process. Organisations need to assess the degree of compatibility between existing hardware and software infrastructure, and the new cloud architecture.
Teraco’s Data Centre Projects
At the conference, Teraco announced the latest developments in the expansion of its Isando Campus to cater for the increased demand for cloud services. The current expansion of this campus (JB3 phase) is expected to increase total usable space by 4 000m2 to a total of 12 000m2 by Q3 2019. The total power available to the Isando campus will increase by 60MW and total 80MW.
Teraco believes public cloud infrastructure, meant to serve the sub-Saharan Africa (SSA) region, will be mostly located in SA. This is mainly due to the country being one of the largest economies on the continent and possessing adequate ICT infrastructure to support cloud development. Despite the current power generation challenges, Teraco believes SA remains best-positioned on the continent to accommodate data centres and provide the required power supplies for their optimal operation.
Other arguments for SA as the best location for public cloud infrastructure include:
- Lower latency: The location of public cloud data centres in SA (as opposed to outside SSA) will reduce the latency levels and improve data transmission within the region.
- Large addressable market: There is a growing addressable market for cloud services in SA and across the Southern African region. This will create a cloud market for locally-based cloud providers, making the country a regional hub of cloud services.
- Stable political environment: Generally, SA enjoys a stable political and economic environment, which is critical to attracting foreign investment, including public cloud infrastructure providers. Hence, sustained political stability will result in the country being a favourable destination for cloud infrastructure.
Unisa’s Hybrid Cloud Services
UNISA currently leverages Microsoft Azure cloud services that utilise Teraco data centres. These cloud services are highly scalable and significantly improve the capabilities of the institution. As a result, the hybrid cloud services have improved the learning experiences of up to 350 000 students by reducing latency and improving connectivity speeds.
Currently, the key cloud services UNISA subscribes to include SaaS, Container-as-a-Service (CaaS), PaaS, IaaS, Azure Kubernetes Service (AKS), Office 365 and Microsoft’s GitHub. UNISA also subscribes to site-to-site VPN services from Microsoft.
As a result of the cloud migration, UNISA has been able to migrate 355 GB structured data to the cloud.
The three broad stages characterising the cloud migration journey are planning, migration and modernisation / extension.
Huawei, Microsoft and Teraco have increased their efforts in providing cloud and data centre services to the market, which is evident from the increased investments committed by these companies.
Service providers believe key considerations prior to cloud migration include the assessment of existing budgets to establish affordability, addressing scarce skills necessary for cloud management and extension, and leveraging existing infrastructure with the new cloud architecture to achieve cost savings.
Furthermore, service providers believe SA is well-positioned to host cloud and data centre infrastructure due to its energy generation capacity, good ICT infrastructure and a stable political environment.
Contact Derrick Chikanga for more information on cloud services or IT services.
Helios Towers (HT) was founded in 2009 and concluded its first tower sales and lease back deal (S&LB) deal with Millicom in Ghana. Subsequently, HT has undertaken similar deals in Congo Brazzaville, DRC, and Tanzania. In 2018, Helios Towers entered the South African market.
HT’s principal business lies in building, acquiring and operating telecommunications towers that are capable of accommodating and powering the needs of multiple tenants. These tenants are typically large MNOs and other telecommunications providers who in turn provide wireless voice and data services, primarily to end-consumers and businesses.
HT uses the sales and lease back method of buying towers from mobile network operators.
By end 2018:
- HT had acquired 82% and had built 18% of its total tower stock (total towers 6 745) since commencing operations in Africa.
- In 2018, there were 13 549 tenants that yielded an average tenancy across its towers of 2.01x.
- In 2018, HT earned an average of USD4 435 per month per tower, or USD2 208 per customer per tower per month.
In 2018 HT entered into a partnership with Vulatel (Pty) Ltd and formed Helios Towers SA (HTSA) with HT owning 66% and Vulatal 34%. Vulatel has been in operation since 2017. The company acquired Dimension Data’s fibre and wireless division (formerly Plessey South Africa).
Subsequently, Vulatel acquired Gio Construction, a provider of network deployment and maintenance services.
Contact Andre Wills by e-mail to discuss the profile or answer any queries you may have.
The East Africa Com conference took place in Nairobi, Kenya during the days 14 and 15 May 2019. The overarching theme of the conference was new technologies enabling the emerging digital world and digital transformation. The specific focus of the conference was also on how these developments will unfold in East Africa and the impact they are likely to have across economic, social and government environments in the region.
The eco-system was well-represented at the conference, with organisations from the ICT industry, financial institutions, parastatal utilities, government entities and academia inter alia. Theoretical discussions were supported by ample examples of current uses cases for new technologies in East Africa.
The topics at the conference dealt with a wide range of subjects, tackling issues such as:
- Quality broadband connectivity and “affordable” access to ensure maximum socio-economic inclusivity in Africa (this continues to be a pertinent topic despite years of private sector and government initiatives);
- Adoption and application of new technologies (such as Blockchain, Artificial Intelligence, Machine Learning) in various vertical industries and government agencies to deliver new and improved services to customers;
- Democratisation of data to make it more readily available for analysis to solve socio-economic problems through development of correct policies, yet remaining mindful of the requirement for data anonymity;
- Digital transformation among organisations in East Africa to become more efficient and globally competitive, and positioning for the 4th Industrial Revolution;
- Mobile money and financial inclusion; and
- Growing women leaders in ICT and business in general.
On the last point, the East Africa Com conference has developed a partnership with ITC SheTrades, an initiative of the International Trade Centre, a joint agency of the World Trade Organisation and the United Nations. The SheTrades initiative aims to connect three million women to market by 2021, facilitating opportunities for women entrepreneurs, supported by a web and mobile digital platform. At the conference, the emphasis was placed on bringing women into the tech sector and using technology to enable women to participate in economic activities to a greater extent. This would unlock a lot of additional value and grow the global economy, especially in developing markets.
Connecting ICT stakeholders
The AHUB again proved to be a very useful medium of connecting local technology start-ups with investors, operators and large corporates to foment collaboration on new projects and (hopefully) mutually beneficial partnerships. The discussion panel on “Realising synergies between MNOs and African tech start-ups” illustrated initiatives already in place aimed at creating an environment conducive to start-up development and success, although still only 1 in 10 start-ups achieve some form of success (including survival beyond the short term). Revenue splits from commercial products (such as apps) continue to be skewed in favour of large mobile operators who claim they provider greater inputs into the partnership. This can stymie the growth of start-ups into sustainable companies.
Building a successful digital economy
To build a successful digital economy in East Africa a number of more basic building blocks still need to be put in place. For instance, liberalisation of immigration laws to attract foreign skills and direct investment, or creation of incentive schemes to experiment with new technologies through pilots (“sand boxes”) free from bureaucratic constraints. Availability of requisite spectrum for new access technologies (such as 5G) timeously is also critical.
Regulating new technology
One of the recurring discussion points at the conference revolved around regulating the new technologies and services in the digital world. One first needs to understand what it is that one tries to regulate, which is what the governments and regulatory authorities in many markets are currently trying to achieve. Unfortunately, the consensus was that we are likely to see more rather than less regulation, which is also bound to become more complex with increasing complexity of the digital environment around us. This is at a time when most stakeholders hope to see less, not more, regulation to allow for freer development of the digital future. It is critical for governments and regulatory authorities to embrace new technologies, rather than stifle them with over-regulation, lest we miss out on opportunities the new technologies offer.
4th Industrial Revolution
In a sense, Africa is already well suited to the 4th Industrial Revolution. Out of necessity, and limited formal jobs, the gig economy is alive and well. New technologies such as AI, ML and mixed reality innovation will drive these opportunities and create more formal job. An example is the recent launch of the Africa Development Centre by Microsoft in Nairobi, Kenya and Lago, Nigeria which will bring USD100 million of investment and 500 engineering jobs over the next five years. Africa can take advantage of its young population to drive this growth but it first needs to create capacity.