Public Funding of Incumbent-Centric Broadband Networks

In a post titled, "Incumbents and national Broadband Networks-Broadband Deliver U.K Project" under the label "Broadband Deliver U.K Project" I had written about U.K's Public Accounts Committee's criticism about lack of competition in choice of implementing agency for this project. Another recent news item  talks about PAC's doubts about misuse of public funding. There are allegations of predatory pricing and misguiding/ intimidating customers in local markets.

Fears have been expressed about recreation of BT's monopoly in fixed line broadband. A telling critique goes as follows, " There are many other providers around the country which are delivering future-proof networks today, both in the community sector and the private sector. All of those face the danger of being overbuilt – having their networks overbuilt by BT turning up with state funding. That seems to be entirely the wrong way round.”

This is the point I make in my posts about National Broadband Plans. I believe that public funding of incumbent-centric optic fibre roll outs is a classic case of repeating past mistakes. It goes against competition and will ultimately affect long term growth, innovation and customer service.

Regulation-Competition, Operator Profits and Customer Welfare

The constant tussle between firms' profits, customer welfare (prices and quality) and the regulatory burden of balancing theses interests in the real world (less than perfect markets) is a worldwide phenomenon. 

A recent news item about Canada's Competition and Radio-TV and Communications Regulators issuing a joint statement to the effect that they would work together to "ensure access to services at competitive prices" also informs us that large  domestic firms are up in arms against the government's decision to allow foreign participation in spectrum auctions. The government justifies its decision as it finds that "Canadians pay some of the highest wireless rates in the developed world and that more players would help boost competition." Three big operators insist that "wireless rates in Canada are competitive with those in the United States." 

My question is that is U.S.A the correct benchmark?

The Importance of Being Connected

I quote below from two studies.They highlightsthe importance of connectivity for political, social and economic development and underline how ICTs help bridge the lack of infrastructure in developing countries, thereby contributing to citizens' empowerment and growth.

The first is  "Measuring the Impact of Broadband on Income" by Ericsson. The second is a study by Vodafone Institute for Society & Communications titled "Mobile Technologies the Digital Fabric of our Lives."   The first study focuses on impact of broadband access and speed on income. It indicates inter alia that for Brazil, China & India(BIC), even a 0.5 Mb broadband connections increases household income by USD 800 per annum. Further, "[i]n  BIC countries, upgrading from 0.5 to 4 Mbps increases income by USD 46 per month." (Access to more sophisticated services " boosts personal productivity and teleworking and telecommuting allow for more flexible work arrangements."

A longer quote (below) from the second study reiterates the importance of mobile phones which continue to predominate in countries like India with very low fixed line penetration.

"In developing countries, mobile phones have changed everyday lives for many people. Often, mobile phones are the only accessible and functioning infrastructure. As a result, it is unsurprising that people have become inventive by using their mobile phones to replace or create other societal and economic institutions thatwere inefficient or sometimes non-existent. M-Pesa, for instance, has enabled millions of Kenyans to transfer money without having to travel. It is the most successful mobile banking service in the world, but by far not the only one: around the globe, more than 150 mobile banking systems have been introduced, mainly in developing countries. A similar pattern was found regarding the impact of mobile phone subscriptions on social development. 

• [M]odels show that more mobile phone subscriptions correlate with more democratic participation, less gender inequality and more time in education. Our results support this evidence on the macro-level across a sample of 202 countries. They show a significant relationship between the number of mobile phone subscriptions and the voice and accountability index, which is taken as a proxy for democratisation. This relationship is more pronounced in developing countries as there is naturally more scope for improvement in relation to political participation. 
• Women and girls are often the most vulnerable members of communities in developing countries. Their access to the outer world is often very limited and they have to cope with numerous hurdles. First and foremost, they have to ensure the health and well-being of their families and changing their traditionally assigned roles is often the only way forward. The connectedness and   communication without intervention by (male) others can facilitate such a change and reduce gender inequality. Our model across 148 countries supports this idea based on macro-economic data. It shows that with increasing mobile phone subscriptions gender inequality decreases. Again, the effect is most visible in developing countries.
• Mobile phones can have two major types of effects on education:the most direct impact is the use of education via SMS texts or mobile applications, which can reach children as well as adults tend to be larger in developing countries. 
•  In practice, mobile phones fill the gap that other poor or non-existent infrastructure in these countries leave wide open. It is therefore not surprising that many innovations related to mobile phones are adopted more quickly in developing countries than in developed countries. 
• Finally, mobile phones are often the first and only way of communication without having to travel under difficult circumstances. 

The Economist says it Best

I am an ardent fan of the Economist magazine and have been reading it for decades. I love it for its language and  variety. A recent article titled, "A World Turned Upside Down with a catch line" Giant state-owned firms have fallen back out of fashion" captures an important lesson in economics (which I hapr on frequently in this blog) in a most engaging fashion with pop music analogies and irreverent certainty of its line of argument.

It states that,

"These vast organisations are not going away; most still make huge profits, often boosted by cheap public funding. But governments must recognise that the slump in their valuations is a sign they are allocating capital badly. That is in no one’s interest. Petrobras has made a baby step by allowing outside shareholders to appoint a director, while China sometimes mutters about modest reforms of its industrial fiefs. But the hybrid model of a firm beholden to both investors and politicians is as full of contradictions as Karl Marx said capitalism was. Privatisation is the best way to resolve these tensions. Businesspeople, at least, can now be a little less dazzled by state firms. To outlast the average pop star’s career, companies need a culture of innovation, financial discipline and, increasingly, global reach. These are things only a few managers are able to deliver—and which no government can."

I have nothing against the public sector but I do feel that a level playing field is imperative for healthy growth of a liberalised sector/economy. I am against ill analysed public funding of PSUs and believe that they must compete (and be allowed to compete) on equal terms with private counterparts to create value for customers. This applies also to Broadband Networks and National Broadband Plans. 

There is more to Broadband Penetration than Physical Infrastructure

This is a theme that runs through by blog. In this case I am speaking not only about broadband enabled services and capacities of stakeholders but also the need for a vibrant market with multi-stakeholder participation and abundant competition at every level, infrastructure, services and content.

An article in the Economic Times titled "Why Broadband is Stuck"  by Mr Pradip Baijal, draws attention to the heavy reliance on PSU incumbents in India to the detriment of outcomes. An example cited by him is the present NOFN scheme which is still in the roll out phase. He speaks about the need for sharing available infrastructure including the aspect of unbundling available fixed line infrastructure. There is also a mention of spectrum sharing. 

What this boils down to is Telecom Regulation. I have argued time and again in  this blog about the need for regulation to keep customer interest in focus and that encouraging competition is one of the best ways of doing so. As regards, the regulatory issues in universal access to broadband services in the Indian context, my article titled "Universal Service Policy in India-Theory and Practice" pointed out the damage done to rural wire line and broadband penetration by regulation that favoured the incumbent at the cost of competition and growth  of services. This paper was written in 2010 but we perhaps have not progressed much in practice as is evident from USOF India's current activities.

Broadband for Sustainable Development

Sustainable development demands that economic growth is inclusive and balanced in terms of trade offs between short term gains and long term consequences.

Broadband Commission's new report,  “Transformational solutions for 2015 and Beyond"  explores the importance of broadband for sustainable growth. It states that,

" while national broadband plans increasingly recognize broadband’s role in socio-economic development, much more needs to be done to support this ‘invisible technology’ transforming our world. A regulatory environment that encourages widely accessible and affordable broadband deployment is the only way to realize its potential to advance sustainable development – for example through proactive policy on spectrum and the protection of inventions.

As far as comprehensiveness of National Broadband Plans goes, the figure below is telling

Inclusion of Socio-Economic Elements in National Broadband Plans 2013

Encouragingly more and more countries include education, employment and health as important elements in national broadband plans. However, the lack of emphasis on universalizing access is evident from the last 4-5 bars. Broadband cannot work its magic unless it is universally accessible, relevant and affordable.

The report makes 10 recommendations to fully leverage the potential of broadband in this regard:

1. Make ICT and high speed broadband universally available at affordable cost for all.

2. Ensure that ICT and broadband are embedded in all of the universal goals and national targets to be defined as part of the Post-2015 global development agenda to fully capture transformative, sustainable solutions.

3. Deploy national development policies and plans to actively drive cross-sector integration of economic and social outcomes deliverable and scalable through ICT and broadband.

4. Create a streamlined and enabling regulatory environment for the broadband era that accelerates removal of barriers to market entry for broadband ICT uptake.

5. Provide consumer incentives and harness government procurement to drive demand and stimulate private sector innovation and investment.

6. Twin broadband innovation and investment with sustainable multi-stakeholder business models to capitalize on the transformative potential of universal ICT

7. Drive the game-changing potential of mobile broadband through the optimized use of radioelectrical frequency spectrum for universal ICT for development penetration

8. Promote the utilization of global standards to enable the harmonization and interoperability of ICT and broadband-enabled services and applications, putting special emphasis on affordability and accessibility.

9. Establish a comprehensive monitoring framework for broadband deployment and robust accountability mechanisms to track development progress via industry-wide broadband ICT metrics and indicators.

10. Develop appropriate solutions to maximize resource mobilization, innovation and investment in broadband for both developed and developing countries.

The report also analyse broadband's actual and potential role in achieving sustainable development goals such as ending poverty, hunger and gender inequality and provides best practices from across the globe.  

Please also see previous posts on National Broadband Plans and Broadband Ecosystemhttp://ictsforall.blogspot.in/search/label/Broadband%20Ecosystem

NBN-Changes Ahead

Australia's Financial Review carries an article titled "Coalition mulls NBN Co split to speed construction"
The new government is considering creating two separate entities -one in charge of construction and the other,operations. This article stats that,

The proposal comes as the NBN rollout struggles to ramp up and meet its targets. Under Labor, the NBN rollout missed several key construction targets. NBN Co’s 2012 corporate plan forecast it would pass 359,000 homes and businesses with fibre by June 30, 2013, but it only reached 207,500 premises.

The delays were frequently blamed on labour shortages, planning issues and a range of other problems that resulted in dissatisfaction among unions, contractors and sub-contractors.

Leaked internal forecasts showed NBN Co was set to miss its target of connecting fibre-optic cabling to 1.13 million existing homes and businesses by June 30, 2014, by 273,065 premises.

Service Stream, one of the key companies building the NBN, reported a 672 per cent fall in net profit as it pulled out of the project.


My views on massive  incumbent-centric state sponsored broadband roll outs can be seen under the labels National Broadband Plans, Broadband Networks. I believe lack of competition is a major concern in such initiatives. 

Regulate in Haste Repent at Leisure-Comments from India and EU

I have used this title for another post  under the label Telecom Regulation, but I feel compelled to use it again.

 I read a very interesting article in the Financial Express yesterday. It is called, "A little less lazy pragmatism please" While its focus is monetary policy, it makes an interesting observation which applies across the board,

"In India, we have largely abandoned basing policy and reforms on theory and empirical evidence. Instead, we have chosen to justify badly structured ad hoc policy changes on pragmatism and reality."

It also states that,the label 

"...Only when policies are based on theory and empirics and not on the insiders' insistence on pragmatism does market efficiency increase."

I agree wholeheartedly with this thinking. I believe that In India policy making and regulation could benefit greatly from sound theoretical and empirical analysis rather than the current trend of short cuts and literally what the author of the above mentioned article calls "lazy pragmatism". Correcting this problem calls for greater role of subject specialists in policy making. They are in fact slowly being allowed into the Government regardless of a  bureaucracy who believe they are smart enough to manage anything through a common sense approach and don't a theoretical basis for their decision making. 

It is interesting to note that  BEREC, the body of European electronic communications regulators has come out in similar criticism of the European Commission's draft regulation on a single telecoms market. Please see my post titled "Bold Brave Telecom Reforms in EU."

They are quoted to have said that, they fear that these proposed reforms will be "rushed through the European legislature without proper explanation and full exploration of its potential consequences..... the proposals represent an aggregation of several unrelated measures, whereas the EU Framework is a complex regulatory ecosystem that should be approached as a coherent whole." It is said that "BEREC is concerned that the draft regulation will jeopardise the integrity of the EU framework and its achievements, in terms of investment, competition and consumer benefit."

Given that EU's regulatory framework for electronic communications is indeed an excellent one so far I would hope that they are not right. 

More about USOF India's Device Subsidy Scheme

The Economics Times today reports that the Telecom Commission of India has approved a Rs 50 billion scheme to provide subsidised mobile phones to specially identified beneficiaries in rural areas. the original proposal was to provide these to workers enrolled in the state funded MNERGA (employment guarantee scheme). However it now appears that a more detailed mechanism for identification of beneficiaries is to be determined. further, the TC has also raised objections about choice of the incumbent operator on nomination basis. These are in my view positive developments. Please see my comments under USOF India. The last post on this subject was titled, "Reactions to USOF India's Device Subsidy Schemes & the Confusion over Universal Service Funding"

Simple Solutions

An article titled "Mexico sees its first village cellphone network" on New Europe online caught my attention. It tells us about a village in Mexico where earlier the residents had to trudge to a community phone to make very expensive calls. Community phones are provided by big telecom operators.

However now,

"Using simple radio receivers, a laptop and relatively inexpensive Internet technologies, the people of the village have leapfrogged into the 21st century by setting up what amounts to their own mini-telecom company — one capable of handling 11 cellphone calls at a time at a small fraction of what they used to pay....in just six months, more than 720 residents have signed up to use the new system. Local calls made on off-the-shelf cellphones are free, and phoning relatives in Los Angeles costs just 20 centavos (1.5 cents) a minute. What's more, every subscriber has a distinct mobile number."

I remember a company approaching USOF India for funding a similar solution for inaccessible villages which could not be taken forward.In this case it appears that rather than look for formal funding, the village pooled money and with the help of a not for profit organisation they were able to set up this system.

Regulatory Tug of War

I found a post titled "Here’s how the telecom industry plans to defang their regulators" very interesting. In real world economics equilibrium is rarely stable. It is generally dynamic. So it would seem is the empowerment/dis-empowerment of a telecommunications regulator. 

In India, the Communications & IT Minister has criticized the Deptt. of Telecommunication's tendency to impose heavy penalties regardless of the nature of default by operators and has suggested that these powers be removed from bureaucrats and be given to TRAI. The TRAI is often at loggerheads with the Competition Regulator CCI, on jurisdiction. However, TRAI has recently come to the rescue of a  beleaguered telecom industry with its recommended reduction in reserve prices for spectrum. See "Regulate in Haste, Repent at leisure" under the label Telecom Regulation.

It would seem from the above mentioned post that USA's telecom giants want to remove/reduce FCC's powers to regulate issues relating to privacy, competition and net neutrality. While there motives are obviously their commercial interests, all these issues have an important bearing on consumer welfare which should be the primary concern of the sector regulator. Ex ante competition issues too would normally lie in its realm.

Bold, Brave Telecom Reforms in EU

With a view to boost investment and growth in electronic communications in the EU and with a view to serve customer interests better the European Commission has announced a new set of reforms for a connectec Europe. A post on this subject from International Business Times quotes the European Commission's telecoms chief Neelie Kroes as follows,

"Global competitors caught on to this long ago; Europe, once an ICT leader, is now lagging behind. Japan, South Korea and the USA combined have around the same population as the EU - but over eight times more fixed fibre broadband, and almost 15 times more 4G,"

The proposed legislation is reported to include:

Open internet - the proposals aim to enshrine net neutrality into law across the EU, meaning operators will no longer be allowed to block, slow down, degrade or discriminate against specific, content, applications or services, except in very limited, concretely defined cases.

Actual data speed - Operators will be obliged to provide clear information about the actual available data speed for downloads and uploads, including at peak-hours. If the actual speed the consumer receives is lower than the advertised speed, the operator will be considered to be in breach of their contract obligations.

Easier control of consumption - Consumers will be able to set how much they want to spend every month and once they hit 80% of this figure they will get a notification - also, detailed and itemised bills will be available free-of-charge.

End of roaming charges - The most high profile change being pushed through, the legislation could see the end of extra charges for making and receiving calls when you travel outside of your home country. While the proposals only seek to see the removal of charges for taking calls while roaming, they EC is also looking to get operators to promote "roam-like-at-home" offers where voice, SMS and data are all charged at the same rate while roaming within the EU.

The proposals will need approval from all 28 EU nations and the European Parliament if they are to become law, and if it does get approval the first changes are likely to take effect by July 2014.

While  these appear to be excellent reforms, it is also reported that the Industry [has] attack[ed these] EU telecoms reforms. Clearly roaming is a major source of revenue and their profits will take a hit. They warn against rising prices and less consumer choice as a consequence of these reforms. Small operators complain that roaming  reforms have been "watered down" on account of lobbying by big operators. There are also proponents of anti-net neutrality argument who plead that they should atleast be allowed to provide premium packages.

What I liked best was a quote from Stephen Howard, head of telecoms research at HSBC, “Politics is the art of the possible, and this initiative at last sets Europe on what we regard as a pro-investment course."

Reactions to USOF India's Device Subsidy Schemes & the Confusion over Universal Service Funding

I had written earlier about USOF's intended Mobile handset Scheme. While phones for voice alone may be unavailable to relatively few in rural areas, they may not be owned by women, aged and disabled. If we are aiming at smart phones for internet/broadband access, in my view, affordability of devices is a necessary but not sufficient condition for universalizing broadband access especially for rural India which has negligible broadband penetration. On the supply side, we also need good quality and affordable  connectivity (absent even in urban areas at present) and on the demand side we need locally relevant content in vernacular languages as well universal accessibility to cater to needs of disabled, illiterate and aged populations. My views on this subject may also be seen in previous posts on Broadband Ecosystem.

It has now been reported that 

"The Telecom Commission, the highest decision-making body in Department of Telecom (DoT), recently approved a proposal to give free mobiles to families in villages and tablet PCs to students in government schools that could cost the exchequer nearly Rs 10,000 crore.

The scheme is expected to benefit 2.5 crore individuals in rural households while the free tablet programme would cover 90 lakh students in 11th and 12th classes.It is to be jointly funded by the Department of Telecom and Universal Services Obligations Fund (USOF) – a fund to facilitate telecom services in rural areas. The project is proposed to be implemented through state-run BSNL which will float tenders for sourcing of mobile phones and tablets.The tablets will cost around Rs 4,972.5 crore, of which the USOF will fund 60 per cent and the remaining amount will be provided by DoT.Similarly, the mobile phone scheme, meant for mainly MGNREGA workers, is estimated to cost the government Rs 4,850 crore.The mobile phones and tablet PCs are proposed to come with a warranty of three years. Both the schemes are expected to start after March 2014. ..The tablet PC will be distributed in three phases where is first phase 15 lakh students will be covered, 35 lakh in second phase and 40 lakh in third phase. Under the proposed scheme, students will get tablets for duration of their studies at the school they are enrolled with.

The mobile phone scheme is proposed to cover 25 lakh beneficiaries in first year, 50 lakh in second, 75 lakh in third and 1 crore in fourth year. The mobile phone scheme, meant for mainly MGNREGA workers is likely to be completed over period of six years."

A critique of this initiative may be seen in a newspaper editorial titled "Honey Pot" It has criticized the Fund for being bureaucratic and tight fisted in the past but is also very critical of this scheme which is labeled as a populist measure at the cost of operators whose revenues go towards funding the subsidies. The argument is that the Fund should have been wound up to spare the operators the mandatory contributions to USOF so that they could provide rural services.

It is a fact that much of rural penetration has taken place outside the realm of USOF. I would be a bit wary of device subsidies unless they are restricted to the really deserving (socially/economically)and clearly under served such as rural women, aged and disabled. I would also fault the choice of the incumbent by nomination for almost every recent USOF endeavour. This goes against the letter and spirit of USOF Rules besides being anti competitive. (Read post on Competition for my views on the subject).

However, it is wrong to assume that if the USOF were scrapped operators would have with this money. It is in fact a part of their license fees and hence would be recovered any way. Neither would  they would cater to non viable market segments on their own even if no license fees (or universal levy) was recovered from them. US Funds are supposed to be a competitively neutral, transparent, targeted and hopefully minimal way of providing incentives to bridge the actual access gap. The concept has proven to be more effective than at least rural  roll out obligations in India. The problem arises when the Fund is not used in this ideal manner. This can be traced back to regulatory frameworks and underlying institutions but it is wrong to imagine  that markets can achieve universal service on their own.

Regulate in Haste Repent at Leisure

There are many stories in Indian newspapers at present wherein one can read about the Telecommunications Regulator's recent recommendation in favour of  a considerable reduction in reserve price of spectrum and those relating to permitting spectrum trading. As expected, some are and for and others against these recommendations. Also see "Cheers for old telcos, worries for new" and "Pragmatic way forward."

Either way, in my view, what is important is that all regulation must be based on sound economic analysis placing consumer interests above all. The latter includes a healthy, viable and competitive telecom sector.

This brings to notice the recent controversy over TRAI's 12 minute cap on  advertisements in its role as a broadcasting regulator. The decision is at present subjudice with TDSAT (Telecom Dispute Settlement and Appellate Tribunal) . Now the Ministry of I & B is said to be collecting data on potential revenue losses as a result of this measure. It would be much better if this exercise (and such groundwork in general ) was done before the regulator recommends and the government accepts its recommendations. 

An extract from a news item is placed below which is quite self explanatory:

In May, the Telecom Regulatory Authority of India (Trai) had said commercial advertising limits for TV channels should be capped at 10 minutes. A two-minute-an-hour cap was allowed on ads promoting the channels or their shows, putting the overall ad cap at 12 minutes an hour. Meanwhile, I&B Minister Manish Tewari said a solution should be found through consensus.

“There is a need for both the regulator and the stakeholder to work out a road map regarding the ad cap. There cannot be a regulator if there is no stakeholder and the stakeholders have said they would suffer a loss if the rule comes into effect, while the regulator is doing what they have to,” said Tewari.

I think we need to take regulation much much more seriously in this country as much of our recent economic woes have been identified as arising from inadequate regulatory capacities and fairly clumsy regulation with serious negative repercussions.

Another article which is worth reading on this subject is "Regulators Must Promote Not Strangulate Industry"  in today's Times of India. It speaks about the above issues and correctly highlights the need to improve regulation in all sectors in India. 

Please see my previous posts on this subject under Telecom Regulation.

The Oldest Item in the US Basket-Still Indispensable

An article in the Times of India on 8.9.13 titles "As PCOs hang up, distress calls drop" highlights the importance of public calling offices (PCOs) or pay phones as thet are called in some parts of the world. It is said that ever since the number PCOs are in decline, the number of calls being received from distressed children on the government funded Child Helpline has decreased sharply. As many of these children would be orphans, homeless or from marginalized segments of society, the Helpline would have been a lifeline of sorts to report mistreatment or to locate shelter. It is suggested that the solution lies in installing free phones to the child hotline. 

In India the Village Public Telephone (VPT) schemes were the first to be launched by the Universal Service Obligation Fund and have now been discontinued. As private PCOs outpaced the USOF subsidized in numbers and quality of service this was the right thing to do. However, the government does need to ensure the availability of PCOs in both rural and urban areas. 

One option could be to install purely government/CSR funded phones which can dial all types of public /welfare related hotlines and emergency services. These phones should also be equipped with assistive technologies to make them disabled friendly.This would serve the public well and is a worthy cause for USOF to espouse and support. The revenue earned from calls could meet some of the installation and maintenance costs.

Mapping Broadband Availability-CAF

Detailed mapping to establish market failure before universal service/state funding is resorted to is a wise step which is economical and would also create less market distortions. Indian USOF does this for many schemes but the results are not available in the public domain. They should be.

A news item reports that, In USA, a  "[t]]he FCC has released an interactive map of the 600,000 or so homes and businesses getting broadband thanks to the second round of funding in phase I of its Connect America Fund (CAF) broadband subsidies.That will give independent telcoms information with which to challenge those funds if they believe they are going to areas already served by broadband. The FCC points out that the map could change due to those challenges.The Connect America fund [CAF] is part of the commission's effort to transition Universal Service Fund monies from traditional phone subsidies to broadband. The FCC last month announced that over $385 million had been requested by providers in 44 states. Now it is identifying where they will provide service down to the census block level as part of an effort to insure the money is not used to overbuild existing service.Phase I money goes to incumbent telcos in the best position to get expand quickly to unversed areas."

The mapping is a great idea, but favouring the incumbent is one I am not so much in favour of.

Namibia's Progress in Telecommunications Regulation

The Communication Regulatory Authority of Namibia (CRAN) is following the footsteps of communications regulators across the world in terms of establishing the regulatory basis for licensing, universal service policy and fund, spectrum and digital dividend, infrastructure sharing, open access, number portability, green ICTs etc. This can be seen at "Namibia: CRAN Expects to Award More Licenses."

Newcomers on the scene have a wealth of international experience to learn from and to adapt to their own national context. Sufficient care to ensure competition and level playing field for all at the outset can prevent costly regulatory errors.

South Africa's Plans for a National Broadband Plan

It has been reported that at a recent industry event with the theme of "Broadband – A Catalyst for Sustainable Economic Development and Promoting Digital Inclusion" the need for better policies, "collaboration between stakeholders," vertical separation and demand side measures like "ICT Skills Development, digital literacy programs for students and adults, IT resources and training"  and the" need to move to impact and creating an ecosystem … and mesh together supply side and demand,” have been emphasized by participants from government and industry.

This echoes much of what has been agreed internationally as posted earlier under National Broadband Plans and Broadband Networks. 

An earlier report about the Government's plans for broadband expansion and reactions of the industry may be see here.

http://www.zdnet.com/can-south-africas-grand-broadband-plan-succeed-7000007165/

An extract as below indicates that the 3 options being considered are similar to those which may have been considered by many a nation and certainly same as those considered in India. (Please see post titled "Broadband Networks through the Infrastructure Sharing Route"

"The government currently owns a number of assets in the telecoms market – including long-distance infrastructure provider Broadband Infraco and a 39.8-percent share in South Africa's fixed-line incumbent Telkom. The state now wants to work with the private sector to build a wholesale national broadband network along open-access principles. With around 3.5 million PC broadband connections and 10 million smartphones between South Africa's population of more than 51 million, the country is far from achieving its goal of universal access by 2020.

Though there are many broadband expansion projects underway, they are fragmented, and a comprehensive, centrally planned strategy is essential to boosting broadband in South Africa .., three funding options for the national network [are]:

• Financing a state-owned enterprise.
• Incentives for operators to offer services in economically unattractive rural areas.
• Equity and incentives provided by government could be ring-fenced in a special purpose vehicle."

The public consultation paper on National Broadband Policy suggests that for OFC backbone the incumbent (Telekom) will play the lead role in providing whole sale access even though service competition will be encouraged in service provision to customers . The document lays a welcome emphasis  on developing the broadband ecosystem.