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IEET > Location > Africa > Rights > FreeThought > Economic > Life > Access > Contributors > Lee-Roy Chetty

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The state of broadband access in sub-Saharan Africa

Lee-Roy Chetty
By Lee-Roy Chetty

Posted: Feb 22, 2013

A growing number of nations in Sub-Saharan Africa see Information and Communication Technology (ICT) as a necessary foundation for long-term economic development.

While the Southern African Development Community (SADC) region has been very successful in increasing access to basic voice communications, there has been no comparable improvement in broadband connectivity. In fact, the broadband access gap between Sub-Saharan Africa and the rest of the world is getting wider just as the gap in basic voice communications is getting smaller. Increasing access to broadband connectivity is therefore emerging as a high priority for policy makers across the continent.

The biggest barrier to increased Internet and broadband connectivity is the lack of high-capacity backbone networks. In addition to this fact, there are also two main reasons why the rate of broadband connectivity in Sub-Saharan Africa is so low.

These include the fact that prices are very high and availability is limited.

The average retail price for basic broadband in Sub-Saharan Africa in 2006 was US$366 per month, compared with US$6–$44 per month in India. Typical prices for entry-level broadband services in Europe average US$40 per month, falling as low as US$12 per month in some European countries.

Sub-Saharan Africa also has very limited fixed-line telephone networks, which have been used to provide broadband access in the rest of the world. The average fixed-line penetration rate in the region is currently less than 2%. In many countries, the number of fixed lines is declining as people switch to mobile telephones.

Despite these comparatively low rates of broadband connectivity, there is evidence that there is considerable potential for broadband growth in the region. The capacity of international connections to

Sub-Saharan Africa is growing and will increase dramatically as a result of the submarine fiber-optic cables currently under construction.

In countries that have issued them, there has been strong commercial interest in licenses for the broadband spectrum, and some of the major regional mobile operators are increasing their strategic focus on data services.

Successful development of mass-market broadband connectivity across the region, however, will require investment across the supply chain. One potential bottleneck is the supply of domestic backbone network infrastructure. Government policy related to these networks is therefore a key component of overall broadband policy.

The current backbone network infrastructure in Sub-Saharan Africa, though extensive in its reach, is predominantly low-capacity, wireless based infrastructure designed to carry voice communications traffic. The current network infrastructure is not capable of carrying the volume of traffic that would be generated if affordable broadband connectivity were available on a mass-market basis.

The market structure of the backbone network infrastructure is another constraint to the development of the broadband market in Sub-Saharan Africa. Backbone networks are typically owned by vertically integrated operators that have built end-to-end networks.

Competing downstream operators and service providers are therefore not able to obtain access to affordable backbone capacity, so competition in the provision of broadband in the region has not developed as well as it has in other parts of the world.

This limited availability of high-capacity backbone networks is one of the reasons that broadband is not widely available in the region and remains a niche product, affordable to only a small portion of the population.

This pattern of network development is the result of a combination of factors.

In many countries in Sub-Saharan Africa, regulatory frameworks actually provide disincentives to investment in backbone infrastructure by limiting the types of infrastructure that can be built and constraining the range of services for which backbone networks can be used.

For example, some countries prevent mobile operators from selling backbone services to other operators on a wholesale basis. This reduces the potential demand for backbone services and therefore limits the incentives to invest in the infrastructure.

Where countries have fully liberalized their telecommunications markets and promoted infrastructure competition, competition among backbone networks has emerged. The networks have focused on the most profitable geographical areas, primarily major urban areas and intercity routes. Cross-border backbone network connectivity is also developing as regional businesses are established and as network traffic is increasingly composed of Internet-based communication rather than traditional basic voice communications.

The majority of the Sub-Saharan African population living outside major urban areas is unlikely to benefit directly from backbone infrastructure competition. If backbone networks are to reach beyond these areas, some form of public support will probably be needed.

A market-based approach is likely to be the most effective means of achieving network development.

Private investment in backbone networks can be encouraged by removing regulatory restrictions on private sector investment. These restrictions include limits on the number of licenses, constraints on the type of infrastructure that licensees are allowed to build, and restraints on the services that licensees are allowed to offer.

Aside from involving the private sector, the cost of backbone investment for governments in Sub-Saharan Africa can also be reduced by providing access to alternative transport and energy infrastructure. Utility companies, such as electricity transmission operators and railway companies, can become effective players in the backbone infrastructure market when brought within the formal telecommunications license framework. Finally, government can reduce the risk of investment in backbone infrastructure by offering political risk insurance and partial risk guarantees.

Countries in Sub-Saharan Africa and elsewhere that has taken such steps have seen increased private sector investment in backbone network infrastructure. Backbone network competition has proved to be viable, and where it has been established, it has significantly expanded the quantity and quality of available backbone capacity.

Stimulating backbone network development beyond major urban areas will require more active public support. This support will be more effective if it is provided in partnership with the private sector.

Lee-Roy Chetty holds a masters degree in media studies from the University of Cape Town and the University of Massachusetts, Amherst. A two-time recipient of the National Research Fund Scholarship, he is currently completing his PhD at UCT and an economics degree with Unisa.
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