Kenya's Broadband Plan

It is good to read that Kenya is creating a 30 billion shilling venture fund (through sale of bonds) for broadband roll out. It is reported that, "Under the broadband strategy, the government plans to double its fiber-optic network to 60,000 kilometers (37,282 miles) by 2017 and provide free and subsidized laptops and mobile phones." Apart from government's budgetary commitments, private investment is also expected to rise substantially over the next decade. Another interesting development is the proposed merger of  "three state agencies, Government Information Technology Services, the Directorate of e-Government and the Kenya ICT Board, into a single entity to be known as the Kenya ICT Authority, Information, Communications and Technology." 

They seem to be following a well thought out Broadband Plan which has recently been identified as an important  driver of broadband penetration. The importance and effectiveness of National Broadband Plans has been recently endorsed by the U.N. which has stated that, “There is a need to move from ‘silo thinking’ to a more comprehensive point of view encompassing different sectors, in recognition of the nature of broadband as a cross-sectoral enabler.”

In India better inter agency coordination or even merger would help realize the goals of the New Telecom Poilcy 2012 and National IT Policy 2012 which are at present being implemented by two separate government departments. 

The Potential Blessings of High Capacity Broadband

An article on Australia's NBN denial of preferential access to any agency highlights how useful a high capacity FTTH connection can be for especially vulnerable segments of the population like ill, disabled or elderly people living alone. Health care providers could use such connectivity to deliver services and monitor their health and well being. The application service provider could either approach NBN directly for connectivity for this purpose or through one of its client access service providers. The end customers would only be dealing with the application (health) service providers.

The article highlights that NBN shall not give any preferential treatment "to government agencies or health organisations wanting to use the national broadband network to provide services directly to Australian citizens."

India's National Optic Fibre Network which is to connect 250000 village panchayats and is being implemented by an SPV named BBNL has announced that it will  offer free bandwidth free  to the Telecom Service Providers  from Block headquarter to Gram Panchayat  for connecting one BTS for two months from June 2013. This may be to encourage rural penetration and wean TSPs off microwave based back haul which is quite prevalent in the absence of fibre back haul.

Reforming USA's US Programme

As reported at "FCC Votes To Launch E-Rate Reform"

The FCC Friday launched its reform of the E-rate schools and libraries subsidy, proposing to refocus the program from connectivity to capacity and speed, collect more and better data, simplify the application process and take other steps to modernize the program.

The E-rate program provides discounted broadband service to schools and libraries through the FCC's Universal Service Fund, a fund paid into by telecom providers--the fee is passed onto subscribers.

The proposed reform has three main goals: 1) insuring affordable access to 21st Century communications; 2) maximizing its cost-effectiveness; and 3) streamlining its administration.

In my view the progranme continues to be very complicated and demanding of Administration. 

Please see my previous posts at 

http://ictsforall.blogspot.in/search/label/U.S.A%27s%20US%20Programme 

All Women BPOs in Conservative Indian States-ICTs for Women

The potential of ICTs to empower women inspired us in USOF to implement the highly successful Sanchar Shakti intiative. Sanchar Shakti  improves the target beneficiaries' confidence levels and financial independence by helping them with knowledge and market inputs related to their on going entrepreneurial activities. 

Rural Business Process Outsourcing (BPOs) is another example of the successful use of ICTs to empower rural women. While rural and semi urban BPOs in the Southern states of India do employ women, the engagement of women in ultra conservative Northern states like Haryana (HarVa) and Rajasthan (SFC)  is remarkable and demonstrates the power of ICTs to transform lives and societies. In both cases it was tough to get the women who had never even seen computers and whose activities outside their homes are strictly monitored by their men folk to even try out the initial training. However, the improvement in a family's financial  status while the women are still close to home, can be a powerful motive to allow the women to experience the empowering impact of working outside the home. ICTs can make this possible.

Stories in this regard can be seen at 

http://www.rediff.com/getahead/slide-show/slide-show-1-achievers-the-inspiring-story-of-a-bpo-in-rajasthan/20130718.htm#4

and 

http://articles.economictimes.indiatimes.com/2010-11-10/news/27587068_1_women-in-rural-areas-business-process-outsourcing-suman-devi

This makes a strong argument for an all out effort to promote universal access to broadband focusing especially on mainstreaming digitally excluded segments like women and the disabled.

Telecom Regulation Reform for Effective Competition & Growth-BCG Report on EU Regulation. Also, Indian Operators Finding Own Unique Solutions

I strongly believe that good regulation and competition are imperative for  achieving at least near universal service and digital inclusion and unlocking the potential of communications as a growth driver.

While in my opinion, the e-communications regulations in EU are worthy of emulation, it would appear there is always scope for improvement.

A study by The Boston Consulting Group (BCG) for the European Telecommunications Network Operators’ Association (ETNO) suggests  “a reformed regulatory framework” to ensure competition and encourage investment in advanced Next Generation networks.

Thus the report finds that “outdated and intrusive regulation is responsible for distorting market-based competition and discouraging capital investment, particularly by telcos, in NGA.  It states that,

“These trends must be turned around if Europe is to remain innovative and competitive in the global digital marketplace. Doing so requires a shift in the approach to regulation towards a new paradigm centred around:

1.    A harmonised-and substantially reduced-pan-European regulatory approach, relying mostly on established competition law

2.    A short- and long-term comprehensive view of all the costs and benefits for consumers which takes into full account the long-term benefits of investments for consumers

3.    A full view of the value chain, in a technology-agnostic manner and with a differentiated geographic lens

The study proposes five measures that will reverse the regulatory root causes of lagging telecommunications investment and help to unlock the funding required to build the ultra-fast connectivity that is increasingly the lifeblood of the digital economy:

• Substantial deregulation of fixed-line wholesale access
• A level playing field for network operators and digital services providers
• Spectrum policy that accelerates the build-out of mobile networks
• Permitting healthy consolidation in mobile
• Harmonising rules and procedures to unlock cross-country synergies

Taken together, BCG estimates that these five measures would increase telecom operator cash flows by a cumulative total of €105 billion to €165 billion by 2020 and asserts that a significant portion of these funds would be available for additional investment in next-generation networks.  Along with the roll-out cost savings that DG Connect initiatives, such as the pending “less digging = more broadband” regulation,are expected to deliver, this programme would significantly close Europe’s next-generation network investment gap, fuel growth and add jobs, and bring the goal of a vibrant Digital Single Market much closer to reality."

A similar approach would greatly benefit many a developing nation and perhaps developed nations too as previous my blog posts on telecom regulation and competition  would suggest.

While on the subject of Competition and Telecom reforms an article from the Economic Times highlights how smaller mobile operators are taking advantage of intra circle roaming to come together, share infrastructure and compete with bigger players even as the industry is critical of the current M&A regulation. Innovation and adaptation is the hallmark of Indian telecom market.

India's Broadband Initiative-Bharat Broadband Network Ltd

I have mentioned earlier that 2.5 lakh village panchayats (local government centres) are to be connected through the National Optic Fibre Network or the public sector SPV called Bharat Broadband Network Ltd. This roll out would take high speed broadband  to rural India and hopefully revolutionize rural telecommunications.  A rare update on BBNL appeared recently in Business Line. It reported inter alia that 

"A survey – to chart an optimum route [for OFC] - for all 2.5 lakh GPs in the country is underway. The National Information Centre has been roped in to create a digital map, with routes and nodes, using Geographic Information Systems technology. It would be hosted on BBNL Web site for the citizens to review it and provide feedback."

and that,

"Tenders for laying the network had been floated and financial bids were opened on June 7, however unsuccessful bidders have approached court and their bids were opened on June 21. Due to this delay, the tender would be finalised by July 31."

This is often a problem with PSU tenders and not limited to India. Expenditure so far has been Rs 229 crore or USD 38.346 Million.

It is hoped that these teething problems are soon overcome and the roll out is achieved on time. It is also hoped that  the resultant network is effectively regulated to ensure open access and a level playing field between participating Public Sector Units (PSUs) and various private entities involved in the broadband eco-system. Needless to say these supply side initiatives must be accompanied by measures to address other aspects of the rural broadband value chain.

How Markets Address Access Gaps

A news item titled "Vodafone to educate students on benefits of mobile internet" shows us how markets can effectively close access gaps. 

Vodafone India  has launched a programme called ‘Gammat Jammat’,  aimed at educating rural school children in the state of Maharashtra  about the  the benefits of mobile internet. To this end they will train over 300 school children and award them certificates of course completion. Simultaneously they will conduct a campaign to create awareness among adults covering 118 villages. Further, they have launched an entry level tariff plan with the same name, which gives concessional  internet access and 'a free 30 page booklet containing basic information on some key internet applications and websites that are relevant to rural customers. It has separate sections and applications catering to the requirements of Youth, Farmers, Job seekers, Housewives and Businessmen.'

It is stated that,

"Vodafone says it sees immense growth potential in mobile internet and are exploring options to further accelerate mobile data adoption through penetration, consumption and value addition. Various industry studies indicate a spiralling growth in sales of smartphones, particularly in locations beyond the metros. However, this community is still largely unaware on how they can get the best out of their data enabled handsets, through mobile internet"

Very recently I had written about "M Education and the Demographic Dividend" wherein I had discussed the potential of mobile screens to impart education in developing countries. India is a young country with 54% of the population being under 25.  In fact India is often cited as an example of the demographic dividend whereby the larger relative share of working age population has the potential to progress the economy to higher rates of growth. However it has been reported that only 12% of the 38 million internet users in India can access internet on their mobiles. The use of internet/broadband in rural areas can effectively compensate for the lack of various essential services and facilities and affordable smart phones and tariff plans and content in local languages can unlock this potential.

This   initiative by a service provider underlines the importance of markets and the need to address the Market Efficiency Gap which in turn leads to a conducive environment for operators to function and serve customers. Once servicing under served segments is seen as an opportunity rather than an obligation the government would need to concentrate only on the actual access gap.