Business

Bridging the Infrastructure Gap through Broadband Development

Emma Okonji examines the role of broadband development in addressing the infrastructure gap in the telecoms industry
 
Worried by the low level of telecoms infrastructure occasioned by lack of ubiquitous broadband presence in all parts of the country, the federal government has made a renewed commitment to work with the Ministry of Communications Technology and the Nigerian Commutations Commission to accelerate broadband coverage.
 
The new plan is to formulate policies that will increase broadband penetration and as well bridge infrastructural deficit in the telecoms industry.
 
The Minister of Communications Technology, Mrs. Omobola Johnson, gave the commitment at the 2014 World Telecommunication and Information Society Day (WTISD), held in Abuja last week.
 
According to the minister, having identified infrastructural deficit in the ongoing implementation of the National Broadband Plan, the federal government decided to come up with a new strategic policy that will improve broadband and enhance information and communications technology (ICT) infrastructure across the country.
 
 
Broadband connectivity
 
Speaking at the event, Johnson said broadband connectivity remained a critical element in ensuring that information and communication technologies are used as effective delivery vehicles for health, education, governance, trade and commerce in order to achieve sustainable socio-economic growth.
 
Emphasising on the importance of the theme for this year's WTISD, which is: ‘Broadband for Sustainable Development’ the minister said it was appropriate, since it was in line with the current revolution being driven in Nigeria, saying that broadband is the next frontier in the ICT industry which will help in the speedy transformation of the Nigerian economy.
 
She further stated that the broadband vision for Nigeria would lead to connecting more communities with high speed Internet and broadband access that would facilitate faster socio-economic advancement of the nation and its people.
 
"The policy goal of the federal government recognised the immense socio-economic importance of broadband services to national development and therefore seeks to ensure that the infrastructure necessary to provide ubiquitous broadband services is available and accessible to all citizens at affordable rates," Johnson said.
 
 
Expected benefits
 
Addressing the expected benefits of increased broadband penetration in the country, Johnson said it would bring about transformative benefits of having broadband available to all Nigerians for improved learning, increased job creation, better community and civic engagement, improved trade and commerce, and a positive impact on Gross Domestic Product (GDP).
 
According to the minister, over the years, the modest success recorded with broadband in the ICT sector had been with several initiatives, occasioned by the immense success of the digital mobile services boom in Nigeria, including the subsequent landing of several high capacity submarine cable systems that slashed wholesale international bandwidth prices.
 
Although the berthing of submarine cables from Glo1, MainOne, MTN WACS and SAT 3, have helped in reducing cost of bandwidth from $4,000 per megabyte per month to $500 per megabyte per month, Nigerians are yet to feel the benefits of the avalanche of submarine cables in the country because the cost of internet remains high.
 
The reason for the high cost of internet access has been blamed on the inability of government to build a national backbone infrastructure that will transport broadband capacities from the shores of the country to the hinterlands, where internet services are needed in high demand.
“However, ineffective distribution and transmission of the available bandwidth inland have continued to make accelerated expansion of broadband Internet access at more affordable end-user prices, a major challenge and a barrier to faster realisation of the desired broadband boom in Nigeria,” she said.
 
 
Broadband revolution
 
Speaking on where the country is currently on its broadband revolution, Johnson said the country now has a clear broadband supply chain that comprises international connectivity, a national backbone network, metropolitan access links, and the local access network (the last mile).
 
According to her: “Nigeria has an estimated population of over 167 million people and a land mass of 923,768 square kilometres. The telephone subscriber figure for Nigeria as at the end of February 2013 was 116,601,637 active lines. The four active GSM operators have about 96 per cent market share while the three active  CDMA operators have the rest."
 
“Also, the 2G mobile coverage is at 98 per cent but 3G coverage which is mostly concentrated in urban areas is very limited at less than 35 per cent. Internet penetration is quoted at 33 per cent and broadband penetration is at 6 per cent. Though the Internet was first introduced in Nigeria in 1996, no appreciable uptake was recorded until the further opening of the market in 2001.”
 
Stakeholders have however lamented that the slow uptake of Internet has been largely attributed to network infrastructure deficiency among other factors.
 
According to some stakeholders, “Nigeria currently boasts of primary fibre optic backbone infrastructure presence in all the 36 states and the federal capital territory, with most fibre infrastructure concentrated in state capitals and a few urban centres. Of the 774 existing local government headquarters, very few that happen to be on the route of the primary fibre backbone are connected.”
 
Meanwhile, the minister pointed out that the key objectives of the Nigerian National Broadband Plan were to promote pervasive broadband deployment, increase broadband adoption and usage, and ensure availability of broadband services at affordable prices.
 
These, she said, were aimed at maximising the socio-political and economic benefits of broadband to the people.
 
“It is intended over the period of this plan to see more than a five-fold increase in Internet and broadband penetration figures. It is also intended that all state capitals and urban cities have metro fibre infrastructure installed," the minister said.
 
“Certain estates and business districts within major cities shall have fibre to the home or premises, whereas, on a national scale, it is the intention of government to facilitate full rollout by operating companies of 3G networks with the potential for immediate transition to 4G/LTE as spectrum becomes available,” she stated.
 
Spectrum licences
 
In an effort to increase broadband accessibility, the Nigerian Communications Commission (NCC) had auctioned the 30MHz spectrum on the 2.3GHz frequency band and further arrangement is on ground to auction 2.5GHz band frequency spectrum. Again it is expected that at the end of digital switch over in 2015, there would be availability of spectrum for broadband deployment.
 
Johnson therefore called on governments at all levels, the industry, academia and technical experts, “to identify key gaps in broadband research and development, infrastructure, and packaged development of applications and services and to seek leading edge technological solutions, particularly in the extension of broadband access into rural areas, unserved and underserved areas for the socio-economic development of our country.”
 
NCC's assurance on broadband
 
In the same vein, speaking at the Lagos edition of the WITSD forum, the Executive Vice Chairman of the Nigerian Communications, Dr. Eugene Juwah, has assured Nigerian and foreign investors on the continuous determination of the Commission to make Nigeria a favourable investment destination for broadband.
 
According to him, the economic impact of broadband penetration had been found to be quite impressive. World Bank studies showed quite conclusively that in low and middle –income countries, every 10 per cent percentage point increase in broadband penetration, accelerate economic growth by 1.38 percentage points.
 
Yet, this impact has been said to be even greater than in highâ€Âincome countries and equally greater than the impact of any other telecommunications service.
Notwithstanding the benefits that have been associated with broadband, in developing countries it has to be understood that broadband for all is a medium to long term strategy and the main beneficiaries, in the short term, of the broadband revolution will be businesses, Juwah said.
 
“Because broadband networks need to generate traffic to lower their costs and increase their profitability, and in light of the fact that broadband is an ecosystem in which users play a central role, stimulating demand is also critical by having the required type of contents and services online,” he added.
 
Juwah insisted that the Commission would ensure the adoption of a multi-dimensional approach to ensure that an all-encompassing framework is achieved towards the realisation of increased broadband penetration and accrue the benefits to the country that will arise as a result.
 
However, he said that with the development of the telecommunication industry in Nigeria, few vertically integrated players now dominate the sector and have created infrastructures which are being leveraged on to  compete in the provision of broadband services.
 
“These infrastructures are usually only available to new players in the broadband market at a premium as replication of the infrastructure is both capital intensive and has a long lead time for delivery," he said.
 
“This has led to unfavourable pricing of services in the market place which in-turn inhibits an increase in broadband penetration considering the per capita income of developing countries.”
 
 
Regulatory interventions
 
According to Juwah, NCC has been embarking on regulatory interventions in the market to ensure equality of access to all players. These interventions, he said, focused on reduction of barriers to market entry by ensuring existing and new players in the broadband space have access to transmission infrastructure on a non-discriminatory basis, and without a need to duplicate existing infrastructure by way of fiber backbones.
 
Others, according to him, focused on frequency spectrum availability for service delivery, ensuring proper business model and ensuring competition, while the  regulator can also create the environment for private sector participation and investment in the broadband ecosystem.
 
The interventions also focused on facilitating deployment with incentives to underserved and un-served areas, as well as facilitating agreements and resolving disputes among stakeholders.
 
Based on the renewed commitment by government to increase broadband penetration and to grow infrastructural development in the ICT sector, stakeholders have commended the efforts of government, but warned that the renewed commitment must be sustained.

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