Gauteng Business News

Send  Share  RSS  Twitter  12 Nov 2009

IT & TELECOMS: Eskom Hikes to Affect the Internet


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Internet users and South African business owners, large and small, need to begin opening lines of communication with their respective ISPs in the wake of the 45 percent increase in electricity tariffs as suggested by Eskom.

Eskom has proposed a 45 percent increase in tariff rates per year over the next three years, says Rob Gilmour, MD of RSAWEB, and businesses, like your average ISP that depend on data centres, are going to feel the pinch more so than others.

“This, in turn, is going to affect their customers whether they’re ready to admit it or not. Anybody who is connected to the Internet, either at home or through work, will be affected by these hikes in some way or another and we think it’s time consumers started taking more of an interest in the IT that keeps them connected as well as in how electricity hikes affect it,” he says.

“Electricity or energy costs contribute significantly to data centre hosting costs, with half of every Rand spent on servers in South Africa going towards covering power costs,” he says. “Servers that run business applications, backup data and host local Web sites for businesses and those that manage email, browsing and data management for consumers, use large amounts of power, and a sharp rise in power costs will drive up the price of these services dramatically."

Put plainly, what this means is that when the chosen ISPs electricity costs go up, so too will subscription rates, bandwidth, surfing costs and the like.

“What most consumers don’t realise is that electricity hikes of this measure will most likely nullify any cost benefits they can expect over the next few years. In other words, what they’re saving through price cuts on broadband, for instance, may be negated as their ISPs are forced to cover the rising costs of electricity associated with managing their clients’ backend requirements. We might soon be faced with a country that has taken a proverbial six steps back.”

According to Gilmour, the proposed hikes could cripple businesses that rely on legacy data centre solutions and he proposes that now is the time for users of this type of technology to properly investigate their ISP’s approach to IT in relation to electricity.

“Smart ISPs, are already deploying virtualisation and cloud computing solutions, which, according to studies, can reduce energy costs and consumption by up to 80 percent,” he says.

The benefits being realised by companies deploying these technologies today are numerous but will be most clearly felt when electricity costs skyrocket, he adds, saying it’ll be the smart consumer who choose the forward thinking ISP to manage his online presence.

“Get in touch with your service providers,” Gilmour urges consumers. “Ask them what they’re doing in preparation for the anticipated rise in costs and how their decisions are going to affect you. Find out whether they’re considering new technologies to circumvent these costs and if they aren’t, consider a change.”


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