by SAVIOUS KWINIKA
JOHANNESBURG, (CAJ News) – SOUTH Africa’s telecommunications sector risks stifling innovation and entrepreneurship unless it removes barriers preventing smaller businesses from entering and scaling in the market, according to industry experts.
As demand for connectivity continues to surge among businesses and households, the sector presents significant opportunities for small and medium-sized enterprises (SMEs).
However, high entry costs, regulatory requirements and lengthy onboarding processes remain major obstacles for aspiring telecommunications providers.
According to Chloe Castle, Channel Partner Lead, many businesses are being excluded from the market by expensive infrastructure requirements, compliance obligations and restrictive commercial agreements.
She said smaller internet service providers (ISPs) and technology firms often struggle to compete against established network operators due to substantial capital expenditure demands, software costs and minimum monthly spending commitments imposed by upstream providers.
Castle believes the industry should move away from fragmented dealer models towards more collaborative business ecosystems that allow smaller operators to leverage collective buying power and shared resources.
Such an approach, she argues, could help independent businesses improve margins while remaining competitive in an increasingly crowded market.
The comments come as South Africa seeks to accelerate economic growth and job creation through greater participation by SMEs in high-growth sectors, including information and communications technology.
Industry observers note that despite strong demand for connectivity services, many emerging telecommunications businesses fail to survive because of operational costs and complex regulatory requirements.
Castle said lengthy onboarding procedures also undermine growth opportunities. In some cases, businesses can wait several months to become operational due to procurement, compliance and know-your-customer requirements.
She believes faster onboarding and access to pre-built technical and billing infrastructure could significantly improve the prospects of smaller players entering the market.
The concept of a “business-in-a-box” model is gaining traction among telecommunications aggregators, allowing resellers and dealers to access regulatory, technical and billing platforms without having to build costly systems from scratch.
According to Castle, this approach enables companies already serving business customers in areas such as information technology, security and managed services to expand into connectivity and telephony offerings, creating additional revenue streams and stronger customer retention.
She said businesses that receive sustained support and access to scalable infrastructure are better positioned to build stable customer bases, expand their workforce and contribute meaningfully to South Africa’s digital economy.
– CAJ News