Author, Wei Shi (2019). Bringing Internet to the Other Half of the World. Journal Monthly Briefing Telecoms Intelligence, October 2019, 3-10.
This article deals with a topic that I have personally experienced in my professional life. The article talks about the lack of internet connection to half of the world’s population. According to the International Telecoms Union (ITU), 3.9 billion people or 51.2% of the world’s total population, were already connected to the internet by the end of 2018. In comparison, 81% of the total population in the developed countries are already using the internet, 45% in the developing countries are connected to the internet, and only 20% in the least Developed Countries (LDC) can do so. Sub-Sahara Africa being part of the world where the lack of access to the internet is most acute.
The author mentions that there are three leading factors leaving a large part of the world off the grid. The first factor is the economic reason, the second one is the technology factor, and the third one is governmental and political hurdles, for example, North Korea, that cannot be addressed by the telecoms by themselves.
The article addresses the two main factors, according to the author, that mostly affects internet connectivity. These two factors are economical and technology. The article attempts to provide answers to these questions:
On the supply side: What Solutions can technology provide to drive down the cost level, to make the connecting of the unconnected more appealing to telecom operators? What business case do these new solutions present to the operators?
On the demand side: What factors need to be in place to make the service affordable? What else beyond cost that may also drive the demand?
Comments: The problem statements are related to the title. The three main problems were clearly stated, and I agree entirely with them. However, I believe more factors can be included, were telecoms and regulators can do a lot more. One is the lack of reliable user’s ID. The lack of identification does not allow such population to use any type of formal services. Also, the extremely high cost of tower leasing, and constructions, due to permits and regulations, makes investment unattractive for operators. The spectrum cost puts other players out of the competition for acquiring such assets. Besides, the regulators and the government tax impositions with lack of transparency add additional barriers and extra payments for any new investor.
Review of Literature
Comments: The author did not cite many reviews of literature; however, in the end, there is a brief interview with a Senior Analyst from Ovum. He also included a list of additional resources, all addressing the different type of issues mentioned in his report. Like cheaper spectrum, Smartphones industry crisis and Africa, and other reports created by telecoms Intelligence.
The article addresses the two main factors that, according to the author, affect internet connectivity. And then, he continues to address two solutions.
Supply Side Solutions:
The Author lists the different solutions like Open RAN, TIP and all that.
Most of these innovative solutions are being tested in Sub-Sahara Africa. Most tier 1 mobile operators have been on board with OpenRAN, which is an open architecture that allows having a distributed architecture using network elements from different vendors.
Not so much from the vendor’s side, some of them arguing that the complexity of integrating network equipment from different vendors will not make multivendor networks any cheaper to build, and to operate.
Another similar scope is included in the Telecom Infra Project (TIP) driven by Facebook, that has not quite the endorsement of the largest network vendors.
The Drivers for demand
One of the drivers is the total cost of ownership, which includes the one-off cost of the device, the opening of the account, plus the running cost of the data and content services.
Africa’s data cost is still one of the highest in the world. Furthermore, in many landlocked countries, the price per 1GB is even higher.
Another driver is the content and service. African markets struggle to find the right content and services in their local language and popular in their own local culture. Most investment is heading mostly to benefit mobile money and other financial services. Finding locally appealing contents will incentivise more unconnected users to embrace internet connectivity.
Comments: The findings were clear and spot-on to the point. He provides a couple of examples that are making the right choice in order to provide affordable service with the right localised content.
I know the importance of providing the right localised content in Sub-Saharan African countries. After launching 4G networks in four countries in Africa, we realised the importance in providing the local content to our users. One method was by providing a portal where any user could access local music, educational videos, entrepreneurship support, and promote their local artists or singers in their local languages. The portal was a total hit, even though it did not bring any revenue for the operation.
In his conclusion, he does mention the need for regulators and governments to do more in providing affordable services to the unconnected population. He also refers to some big companies setting up local data centres to make the service more accessible. He concludes by mentioning that the unconnected population can also be found in mature markets, which they also need both public and private sector support to connect them.
Comments: I agree with his conclusion, specifically that both public sector and private business need to do more. Governments need to be proactive and transparent in order to attract new investors. The private business needs to relax the need for a quick return on investments and high margins. In addition, it would be good to see technology vendors working more and more together and providing a full multivendor distributed architecture. Tower companies also need to contribute to making the service more accessible, and device manufacturers need to drop average prices to around $15.
The report is very interesting and addresses the issues for the lack of connectivity very well. I enjoyed reading about it, especially since I experienced all the mentioned factors in this report in real life during my work with a startup company installing 4G networks in Sub-Sahara African countries. The experience was really great and I had the satisfaction of seeing and talking to multiple users, mostly young students using internet for the very first time.
Unfortunately, the pressure of high margins, and the government and regulators barriers, did not allow making that project a success and after 4 years and 4 countries the company gave up and end up selling all their assets.
If we really want to provide services to the second half of the populations, all stakeholders and the complete ecosystems needs to realise that there are more benefits by providing internet access and bringing digital literacy to all sectors of the society. This will at the end bring the possibility for this marginalised society to climb out of the dreaded poverty level. This at end, will make better societies, provide less dependency from the government’s’ programs and can contribute in more income to public and private sectors.
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