SA AV grows up
In the eyes of its members, the South African AV industry is finally coming of age. And not a moment too soon, because in three short years, the country will host the FIFA World Cup and the eyes of the world will be watching.
In the darkest days of the apartheid regime, when the country was in the grip of international sanctions and isolated from the global community, the country’s AV entrepreneurs developed a knack for making do with what was available. Their creative approach to problem solving led to some effective if unconventional solutions to AV challenges.
Of course, since the end of apartheid in the mid-nineties, things have changed dramatically. The lifting of the trade embargo, the liberalisation and the stabilisation of South Africa’s economy have put the necessary conditions in place for a sea change in the audio visual market. Building on the innovative skills developed during the hard times, the country’s consultants, integrators and designers are now bringing those talents to bear on the very latest AV technologies.
In the past, South Africa has suffered from the same gold rush mentality of many emerging markets. Overestimation of the market, and the presence of cowboy operators, or Palookas as they are known locally, seeking to make a quick Rand. However in the opinion of industry insiders this phase, thankfully, has passed leaving a stable and maturing market.
The current feeling in the AV market is one of almost universal optimism. Mark Malherbe, Technical Director of audio distributors Prosound speaks for many when he says that the market is “incredibly healthy”. “We’ve seen a huge upswing in business in terms of every division, whether it’s rental or box shifting or contracting. I’m not saying there are buckets of money around but there is definitely confidence.”
Mark also points to the success of the Mediatech show, South Africa’s all encompassing AV, Media and Broadcast exhibition, as an indicator of the health of the industry. “I’ve been pretty negative about it in previous years, but this year it really demonstrated how our industry has grown up. There were rock solid products on display, intelligently displayed and there was excellent support from the international manufacturers.”
But what does he mean by grown up? Consultant Gavin Olivier of Digital Fabric comments: “There were a lot of players at one time. One or two of the bigger ones have crashed and burned for whatever reasons, who were employing forty or fifty guys. They have now spread out into the market with their own start-ups. We’ve been through the phase of al these small companies trying to cut in on price and so forth, but it’s now settling down nicely, people seem to be finding their place. It’s more stable than it was. That stability has brought with it slightly better margins, and also a better quality of work.”
World Cup aside, what are the major sources of growth for South Africa’s AV market? Religion plays an enormously important role in the lives of many South Africans. Following in a similar vein to that in the USA, South African congregations place huge emphasis on live music in their houses of worship. “Houses of worship have always been huge over here,” says Mark Malherbe. He is Technical Director of audio distributors Prosound and echoes the sentiments of many of his peers. Christie’s sales consultant for Africa, Phil Lord, also lists HoW among his top three markets for the region.
Gavin Olivier draws much of his business from the themed environments sector. Heritage projects funded by the new Government have a huge part to play in the education of the population and the setting straight of the evolutionary record. Visitor attractions such as the Maropeng Centre at the so-called Cradle of Human Kind provide a unique AV experience to visitors learning about the origins of man. There are less scientific delights to be sampled as well: “We’ve just wrapped up the Miller beer brand centre, it tells the history of beer and also the Miller brand. As our country becomes more progressive in its thinking so the opportunities for these visitor centres are growing.”
Other markets of significance are those related to tourism and conferencing with several people mentioning hotels and multipurpose venues as significant sources of business.
Which leaves us with the small matter of the 2010 Fifa World Cup. It is estimated that at one time or another during the final week of the competition that half the world’s population is exposed to the tournament, and therefore the host nation.
“We’ve got this tremendous opportunity to sell our country, which could have far reaching effects. I hope we do it right.” Said Gavin Olivier. Leon Theunissen, partner in integration firm MIT is confident the country can succeed. “I really believe that in South Africa we have the people and the skills to be able to do it.”
However it’s not just stadiums that will be providing opportunities for the AV business. There will be a whole host of other attractions on the back of the main event, and it is here, believes Olivier, that his industry will stand or fall: “I’m concerned about whether or not that art will be done in time. I think we’ll have to pull our socks up rapidly if we’re going to pull this off.”
The World Cup is also having an indirect effect. Christie’s Phil Lord believes that amongst other things it will stimulate demand for HD displays in sports bars and other venues.
“The World Cup is going to be a big grower for us,” said Eugene Coetzee a Product Manager at Electrosonic South Africa. The events business around it is going to be huge and the stadiums themselves present us with opportunities for our LED wall products.”
The broad picture, world-cup aside, is definitely one of confidence and steady growth. There’s no anticipation of boom and bust. That’s likely largely because despite a healthy AV market, the wider South African economy is not growing massively itself. The country still suffers hugely from 25% unemployment and a real poverty gap between the richest and poorest citizens. Another potential cloud on the horizon is identified by Dave McMahon, General Manager of System Solutions. “The lack of broadband capacity is holding back South Africa’s potential in the new media arena. We have incredibly entrepreneurial developers, with fantastic ideas, but until the government releases its strangle hold on the telecommunications market, take up of new, bandwidth hungry AV/IT applications will be hampered.”
This will certainly have to change if the country’s ambitions are to be realised. Many of the technology predictions gleaned during the writing of this report centre around IP. Videoconferencing, digital audio networking and IP content delivery are all on people’s agendas. This is mostly because South Africa is in the fortunate position of having skipped a generation of technology or two. Mark Malherbe remarked: “One of the nice things about this market is that we’ve been out of the loop for so long that we’re not in the situation of having to sell upgraded solutions. It’s a fresh field for us.” A truly positive way of looking at a difficult past, and one that bodes well for the future.