Connect with us

Entrepreneur Today

The Role of ADSL in Your Business

New wireless and fibre options can greatly improve reliability at good prices.

George Golding

Published

on

OnlineAdvertising

Businesses are increasingly dependent on Internet-delivered (cloud-based) IT and communications services today, including Voice over IP (VoIP). In such circumstances, reliable Internet is a must, or your business will simply grind to a halt.

Aware of this, VoIP customers often cite connectivity as their biggest concern. Frequently reported technical issues with ADSL have only deepened their fears, and so the answer is to look beyond using ADSL alone.

The role of ADSL

It must be noted that ADSL is a good technology that has done much to popularise broadband. Even today it holds its own among more up-to-date connectivity options.

But an ADSL link is only as good as the local exchange. Poor ADSL service is often caused by an exchange that is either over-subscribed or under-maintained, causing outages or quality problems like jitter, delay or dropped voice packets.

Good ADSL, bad ADSL

There are good areas for ADSL and bad ones. Some have a rich supply of ADSL bandwidth via well-maintained local exchanges, while others have too many users ‘contending’ for the same bandwidth and poorly maintained infrastructure.

So how do you overcome this? Ensure you’re in a good coverage area (this goes for any form of connectivity). Free tests on sites like www.speedtest.net (line throughput) and www.pingtest.net (quality) give an instant indication of speed and quality of lines.

Secondly, always have ‘failover’ (a backup line) – but never from the same provider or, naturally, using the same technology.

Better new options

Thirdly, ADSL is not the only option. Without detracting from the contribution of ADSL over the years, numerous new wireless and fibre connectivity options are emerging to offer great quality, copious, non-contended bandwidth at a small premium. These include WiMax from Neotel, fibre from Neotel and Telkom, and a range of wireless connectivity providers such as Snowball, Vlocity and TWK.

  • WiMAX offers high-speed connectivity over long distances. It compares favourably with ADSL and fibre in price and performance, without suffering the contention of ADSL or the infrastructural investment of fibre.
  • Fibre – Fibre rollout is speeding up, and uptake among businesses and affluent communities is causing prices to fall. As competition increases, fibre offers increasingly well-priced, high-performance options too.
  • Wireless – The number of wireless providers in SA is growing. Some of the bigger providers offer direct VoIP-dedicated links into national fibre networks such as ECN’s (also VoIP-dedicated). Others link to providers offering ‘breakout’ onto fibre networks. The low cost and minimal infrastructural disruption of wireless allows providers to pursue low-population areas.
  • 3G – The cellular providers offer high throughput at competitive rates, but due to the inability of 3G to handle more than one stream of data (two calls or a call and browsing simultaneously), it must be used in conjunction with a quality of service tool like ViBE (see further down). To use ViBE, 3G users need an unrestricted APN to allow a VPN tunnel through its firewall.
Comparison between broadband access technologies
Technology Line speed Up/downlink speeds Bandwidth package Considerations Price (+/-)
ADSL Broadband 4Mbps 640Kbps/4Mbps 50GB Reliant on exchange (contention, maintenance) R2600
Wireless Broadband 2Mbps 2Mbps/2Mbps Unlimited Breakout onto fibre backbone R2699
Wireless Voice Link 512k 512k Diginet Replacement Unlimited Voice only links directly link into dedicated VoIP networks bypassing all shared networks. 1350
WiMAX Broadband 5Mbps 2Mbps/5Mbps Unlimited Broadband link, new technology R2300
Fibre 2Mbps 2Mbps/2Mbps Unlimited Broadband link, new technology R3050
3G Varies per provider and location Varies per provider and location Depends on package and provider Broadband Link Varies per provider

Source: Webafrica.com, Snowball.co.za, Neotel

Quality vibe

Even with quality technologies like these, uptime can never be taken for granted. As with ADSL, having redundancy or failover with all these, especially 3G, is wise. In fact, because of their cost-effectiveness, an ADSL line or 3G connection is most appropriately used not as primary, but as secondary (backup) line to these other providers.

But if ADSL has been the cause of complaints, and 3G can’t handle more than one voice stream, how can they be an option even as backup? The answer is to combine it with a technology like ViBE by VoIPex, a de facto quality-of-service standard with VoIP providers.

ViBE works on multiple levels to overcome quality and capacity issues:

  • It streamlines data traffic by stripping out unnecessary data
  • Using VPN technology, it ‘insulates’ voice packets within a non-dedicated data line to block out interference from other data
  • By a technique similar to ‘ADSL bonding’, it pieces a complete VoIP stream together out of voice packets from two redundant links if one goes down or both have quality issues

3G, like ADSL, can be much improved with ViBE and VPN technology. With ViBE and an unrestricted APN, VoIP on 3G can handle up to five concurrent calls. ViBE creates a single VPN link, managing multiple calls within it but seeming like a single thread.

Take two

Depending on your financial profile and throughput requirements, a variety of primary and failover connectivity options exist that can give you the assurance that the Internet won’t fail your business.

While ADSL continues to make sense in certain circumstances, a range of new connectivity options like fibre, WiMAX and wireless are challenging the copper technology’s once uncontested birthright to rule the connectivity landscape.

George Golding is Euphoria Telecoms’ CEO and media spokesperson. A natural-born entrepreneur, George is as fervent about IT as he is about affordable communications services and business integrity. Euphoria Telecoms provides Voice over Internet Protocol (VoIP) communication services to small and medium enterprises in South Africa. For more information go to www.euphoria.co.za.

Advertisement
Click to comment

You must be logged in to post a comment Login

Leave a Reply

Entrepreneur Today

3 Stealthy Tax Hikes Payroll Managers And Employees Need To Take Note Of

By Rob Cooper, tax expert at Sage, and chairman of the Payroll Authors Group of South Africa

Entrepreneur

Published

on

tax-increase

“Dammed if you do and dammed if you don’t.” 

The adage summarises the difficult decisions government and the Finance Minister faced when balancing the country’s books, rescuing state-owned enterprises, and reviving the growth of our economy. Given the economic pressure that most taxpayers are facing, government ideally needed to achieve all of that without direct increases to personal income tax in the most recent Budget Speech.

Personal income tax has comprised at least a third of South Africa’s total tax revenue in recent tax years, despite growing unemployment. The 2019 Budget, presented in February, forecasts that personal income tax will account for nearly 39% of tax collected during the upcoming (2019/20) tax year. Given that we are in an election year and that the tax base is fragile, it’s not surprising that the Finance Minister and the National Treasury avoided direct increases to the statutory tax tables used to calculate PAYE for employees in the budget.

Nonetheless, government has made inflation work in its favour to impose some tax increases by stealth. Here are three ways government is raising more revenue without direct tax increases:

1. Bracket creep

The statutory tax tables used by payrolls and employers have not been changed for 2019/20, nor have the brackets been adjusted for inflation. This effectively amounts to an indirect tax increase that will yield a revenue saving of approximately R12.8 billion for government’s coffers.

It is not unusual for government to use ‘bracket creep’ to effectively raise more revenue. But unlike previous tax years, even low- and middle-income earners are not getting much relief. Rebates and the tax threshold are being increased by small amounts to allow some relief, but many people this year will feel the pain as inflationary salary increases push them into a higher tax bracket.

2. Medical aid credit not adjusted for inflation 

As proposed in the 2018 Budget, the Finance Minister did not apply an inflationary increase to the Medical Tax Credit, which allowed him to raise an extra R1 billion in revenue for the year. Surprisingly, these funds will be allocated to general tax revenue rather than ring-fenced for healthcare. In previous tax years, revenue generated from below-inflation increases on medical scheme credits was used to fund National Health Insurance (NHI) pilot projects.

There is still no clarity on how the NHI is going to be funded except for a general statement that the funding model is a problem for the National Treasury to solve, and that the principles of cross-subsidisation will apply. One wonders if any real progress will be made soon, given the fiscal constraints government faces.

3. Business travel deduction left untouched

The Budget leaves the per-kilometre cost rates used to determine tax deductions for business travel untouched. By not increasing travel rates to account for inflation, government effectively increases income tax collection at the cost of the taxpayer. This will be a blow for people who need to claim from their employers for business travel in their personal vehicles. This change has slipped through largely unnoticed and the budget does not provide numbers for the expected increase in tax revenue.

Closing words

Amid political turmoil and uncertainty, the Finance Minister presented a balanced budget for 2019/20 that offers hope for the future along with some tough love. With government taking steps to accelerate economic growth and improve revenue collection, we should hopefully see a steady improvement in government finances, which will translate into less pressure on the taxpayer in future years.

Continue Reading

Entrepreneur Today

SMEs: Staying On The Right Side Of The Taxman

Remaining SARS compliant can be a constant challenge for small- to medium-enterprises (SMEs), especially when they are trying to focus on growing their businesses and streamlining their operations.

Entrepreneur

Published

on

tax

EasyBiz Managing Director, Gary Epstein, says submitting taxes can be a seamless process that does not have to take up more time than is necessary. “If business owners understand what is required of them and they put a few processes into place to deal with their tax submissions properly, their lives will be so much easier.”

What are the top three considerations for SMEs when submitting tax returns?

“Firstly,” says Epstein, “SARS returns must be accurate and submitted in terms of the relevant Act. Secondly, returns should be submitted and paid on time to avoid unnecessary penalties and interest, and thirdly, business owners must follow up on queries issued by SARS. “Do not ignore these queries, act on them as soon as possible”.

What are the major SARS submission deadlines for SMEs?

Epstein points out that small business owners need to adhere to various tax deadlines, each with their own particular dates for submission. “It is important that business owners diarise the dates (and set advance reminders for themselves) and/or enlist the services of an accountant or financial adviser to help them keep abreast of requirements.”

Value-added tax (VAT)

VAT payments need to be submitted in the VAT period allocated to the business, according to various categories and ending on the last day of a calendar month. This may mean making payments once a month, once every two months, once every six months or annually, depending on the category.

Provisional taxes

Provisional tax should be submitted at the end of August (first provisional) and at the end of February (second provisional) – for February year-end companies.

Employee taxes

In addition to submitting an annual reconciliation (EMP501) for the period 1 March to end of February for Pay-As-You-Earn (PAYE), Skills Development Levy (SDL) and Unemployment Insurance Fund (UIF), employee tax, in the form of an EMP201 return, needs to be submitted by the seventh of every month.

When can SMEs get extensions and is it worth it?

Epstein says SMEs can apply for various extensions, but these are subject to the Income Tax Act and Tax Administration Act.

“It is best for SMEs to consult their tax professionals to get advice regarding extensions for their businesses.”

What is SARS not flexible about?

SARS is not flexible when it comes to late returns and late payments.

“I cannot stress enough how important it is for SME owners to ensure their tax returns are submitted on time. In this way, they will avoid the inconvenience and expense of additional fines and interest,” notes Epstein.

What skills do SMEs need in their organisations to be able to submit to SARS efficiently?

Business owners often don’t have the time or expertise to deal with tax submissions throughout the year. If the business cannot afford to employ a full-time accountant or financial services expert, it would do well to outsource its tax requirements to a registered tax practitioner.

“I would recommend that even if they are not submitting the tax returns themselves, business owners should have a broad understanding of the tax regulations and what is expected of them. There is a lot of helpful information on the various Acts and tax requirements on SARS’ website,” says Epstein.

How does the right software help SMEs remain SARS compliant?

SME’s (and their accountants’) jobs can be made easier by using reliable accounting software to calculate accurate VAT reports. These reports are only as accurate as the data entered into them, which means care needs to be taken when inputting data into the accounting programme. Epstein says a good accounting software package must be reliable, easy to use and functional.

“SMEs need to check that the software has thorough reporting capabilities and can interface with other software solutions. Of course, it is also important to find out whether the software is locally supported by the vendor or not.”

Continue Reading

Entrepreneur Today

4 Dangers Of Business Under-insurance

A common short-term insurance peril that many SMEs face when submitting a claim following an insured event is the risk of being underinsured.

Entrepreneur

Published

on

business-insurance

Malesela Maupa, Head of Products and Insurer Relationships at FNB Insurance Brokers says, many small business owners mistakenly believe that by merely having a short-term insurance policy in place they are adequately protected against unforeseen events.

“This is technically correct provided that the business is covered for the full replacement value of the items insured. However, in circumstances where the sum insured does not cover the full replacement value or material loss of the item insured, the business is underinsured,” explains Maupa, as he unpacks the dangers of business underinsurance:

1. Financial loss

The most common risk is financial loss on the part of the business. If the business is underinsured or the indemnity period understated, the short-term insurance policy will only pay out the sum insured for the stated indemnity period as stated in the schedule, with the business owner having to provide for the shortfall. This often leads to cash flow challenges, impacting profit margins or rendering it difficult for the business to recover following the financial loss.

2. Reputational damage

Should an underinsured business not have sufficient funds to replace a key business activity or critical component following a loss, this may impact its ability to fulfil its contractual obligations, leading to a loss of business or market share, and irreparable reputational damage in the worst-case scenario.

3. Legal action

A small business also faces the risk of customers or clients taking legal action against it, should it fail to deliver on goods and services following a loss or be unable to honour its financial commitments that they committed to prior to the loss.

4. Survival of the business

A catastrophic event such as fire, which could result in the loss of stock or company equipment and documentation, could threaten the survival of a small business that is not yet fully established, if the business assets are not adequately insured.

Working with an experienced short-term insurance broker or insurer is essential when taking up short-term insurance to ensure that business contents are covered for their full replacement value.

Furthermore, depending on the nature of the business or item insured, the policy should be reviewed on a regular basis to avoid underinsurance as the value of items often change overtime due to fluctuations in economic activity. Where it’s necessary, evaluation certificates need to be kept up to date.

“Lastly, SMEs should ensure that the sum insured does not exceed the replacement value, which would lead to over insurance. Should a business submit a claim following a loss, the insurer would only pay out the replacement value, regardless of the higher sum insured,” concludes Maupa.

Continue Reading
Advertisement

SPOTLIGHT

Advertisement

Recent Posts

Follow Us

Entrepreneur-Newsletters
*
We respect your privacy. 
* indicates required.
Advertisement

Trending