Hello! Power, Right of Way are Impediments to Broadband Growth in Nigeria
- By Alex Ekemenah
- Published Monday 1st 2011
- ITWorld
- Unrated
Speakers after speakers who themselves are telecom operators in Nigeria and other stakeholders addressed various aspects of investment opportunities that are now beckoning in the broadband sub-sector of the telecom sector as a whole especially how Nigeria can harness and utilize the growing opportunities.
They also spoke extensively and passionately on the obstacles confronting broadband penetration in Nigeria which include lack of policy framework for broadband infrastructure development to take place, the lack or regular supply of electricity and claim of right of ways by local and state governments in the process of laying broadband infrastructures in cities. Indeed, about 70 per cent of the problems encountered by the telecom sector with its broad implications for development of broadband infrastructure were traced to the power sector crisis that has been rocking the nation for the past decades without immediate solution at sight.
Speakers also harped on the need for national policy on broadband to enable the industry grows beyond the present limitations and confines. Not unmindful of what the Nigerian Communications Commission has achieved in the last decade, reference was made to the glowing example of South Korea and Kenya (not excluding other examples) of how good policy and good governance could help to engineer and accelerate the rollout of broadband for the benefit of all.
Participants at the summit strongly emphasized and suggested that there is need for more downstream spectrum licensing for broadband penetration and infrastructural development which is considered so critical for the growth of the economy in the coming decade, especially to restructure how we manage the economy, transact business, e.g. e-trade, e-business, even e-management.
Impediment of right of ways was also highlighted as one of the notorious obstacles to laying of fibre optic which is the backbone of broadband. It was strongly advocated that this impediment must be removed to facilitate and accelerate the laying of fibre optic across the country. Indeed, no local, state government or relevant agencies has absolute control over land except for administrative convenience. It is the federal government that has such absolute control. Since, this is national policy that affects all and sundry, local and state governments must be legally compelled to adhere to the law establishing free access to ways to enable telecom operators install infrastructures for the development of broadband services across the country.
The recent example of payment of $52 million for Multilinks’ assets by Visafone must have formed the background that led some of the participants at the Summit to advocate for merger and acquisition in the telecom sector to consolidate the gains already achieved and harness future opportunities in the sector. This advocacy was contained in the goodwill message delivered by Senator Gbenga Obadara at the Summit.
Broadband Impact on GDP
Growth in the data/internet service segment of the sector has not been as significant as those in the voice segment. In most cases, internet services where available, are at best unreliable and characterized by very low speeds. Statistics for broadband penetration in the country as at year end 2010 hover between one and 2.8 per cent of the population of over 150 million.
According to a publication by the World Bank in 2009, for every 10 per cent increase in internet penetration, there is a resultant 1.3 per cent growth in GDP. Further, the 2010 US National Broadband policy document states, “Broadband is the great infrastructure challenge of the early 21st century. Like electricity a century ago, broadband is a foundation for economic growth, job creation, global competitiveness and a better way of life. It is enabling entire new industries and unlocking vast new possibilities for existing ones. It is changing how we educate children, deliver health care, manage energy, ensure public safety, engage government, and access, organize and disseminate knowledge”
Meanwhile, the Nigerian telecom sector was said to have recorded $8.6 billion profits in 2010 becoming the third largest contributor to gross domestic product (GDP) in the non-oil sector, according to Pyramid Research 2010 Report.
Also spending on information technology in Africa has been projected to increase by 10 per cent to $25bn in 2011, according to the International Data Corporation (IDC). The projections are based on the positive growth rates recorded by some African nations especially in the information and communication technology (ICT) sub-sector of the economy.
By 2013, percentage contribution of telecom industry to national GDP in Nigeria is projected to be around six to seven per cent.
It has been estimated that Nigeria will add about $5.55 billion to its annual gross domestic product by 2015 if it implements judiciously the rollout of broadband across the country viz: unlock the 2.6GHz spectrum quickly to support the high demand for mobile broadband in the urban areas; release the digital dividend spectrum to deliver broadband services to rural areas; and reduce the 35 per cent tax level faced by Nigerian mobile operators, a tax which is double the global average
It was also revealed that only six per cent of Nigerians currently has access to broadband services and 74 per cent of these did so through mobile broadband. There is little fixed broadband connectivity outside Lagos and in most Nigerian cities internet service is wireless.
The study stated that mobile broadband could positively contribute more than one per cent of GDP or 1.7 per cent of non-oil GDP as early as 2015 and would facilitate much needed diversification of the economy. According to the report, government support for mobile broadband services could help deliver significant advantages to wider wireless ecosystem and the way in which other sectors use the internet.
The sectors expected to benefit include online retail trade which could witness about 55 per cent annual growth; financial service sector, 95 per cent; health and education by 70 per cent and agriculture and utility services which would experience 55 per cent growth.
Wider availability of mobile broadband could also vastly improve overall industrial productivity through improvements in business processes. A 73 per cent annual increase in the working population with access to mobile broadband reaching 5.2 million by 2015 will deliver an additional $903.3 million to the Nigerian economy each year.
What Broadband can do for Nigeria
The internet broadband width and speed (penetration) is the next big thing and Nigeria cannot afford to lag behind. Nigeria needs to break through the policy and environmental barriers for broadband deeper penetration. This has wider ramifications in all sectors of the economy and social life. In the educational sector, it enables students at secondary and tertiary institutions to communicate freely and exchange ideas through e-portal, e-library to facilitate e-research for cross-breeding and cross-fertilization of ideas.
African researchers and institutions have contributed just nine per cent of international papers across all the Information and Communications Technology and Development (ICTD) disciplines, although this went up to 13 per cent for some topics such as library science and e-governance. In hard sciences such as computer science, this figure fell below one per cent.
It was equally revealed that of the nine per cent of publications containing at least one African author. South Africa contributed over a third of the papers with Botswana and Nigeria contributing 14 and 17 per cent respectively.
Dr Eugene Juwah, executive vice chairman of the Nigerian Communications Commission, explained that “broadband represents huge opportunities for social and economic progress of any nation or people.” It facilitates the delivery of more effective healthcare and banking, better education, smoother and more transparent governance, sustainable environment, more efficient transportation, national security, as well as smarter and more economical energy supplies.
“Robust broadband networks and services have also globally brought about considerable transformation to businesses and markets, significant wealth and growth in economics. Empowerment of individual, organizations and communities are the further resultants. Access to broadband visibly defines how equipped, businesses, people, communities and institutions are to participate in today’s digital and smart global economy.”
In the health sector, broadband can aid surgery and other operations without the physical presence of the resident doctor or physician. There is also telemedicine possibility through teleconferencing, etc.
Lessons from Other Countries
The success story of South Korea in broadband was captured vividly in the life of an English teacher living in Seoul who has had a high-speed internet connection of 8 megabits per second—only about average for a South Korean apartment, but nearly eight times the typical broadband speed in U.S. households. He watches TV shows over this connection, creates multimedia projects for his class and regularly updates a weblog.
None of what he does is revolutionary; it just happens far faster than it would in America. And that’s a little revolutionary all by itself. The Korean government’s clearly articulated vision for modernizing the country’s infrastructure stands in stark contrast to the regulatory morass that has stunted development in the U.S telecommunications industry for several decades.
South Korea’s policy, the cornerstone of a national technology initiative to help revive a devastated economy, has created true broadband competition, which, in turn, has helped prices fall and speeds rise.
Although its economy is still struggling, South Korea has made significant progress with many forms of digital technology. Citizens can get “video on demand” online for less than what Americans pay to rent a DVD. Low-income students use high-speed net connections to take free tutorials for the national aptitude test and SAT-like exam that can determine college admissions and future job paths.
South Korea has emerged to become the world leader in internet connectivity and high speed. It was able to achieve this because the government had established policies and programmes that facilitated a rapid expansion and use of broadband.
The internet has a higher status for many Koreans than it does in the West. And upon realizing this indicator, the government actively supported it. South Korea’s broadband network is the fastest and according to the Information Technology and Innovation Foundation the most developed in the world. Particularly Seoul, the nation’s capital, has been called “the bandwidth capital of the world”. In January 2006, it became the first country to achieve over 50 per cent broadband penetration per capita. By 2005, it was the first country to complete the conversion from dial-up to broadband.
It also has the cheapest, fastest broadband in the world. Now there are experiments with speeds of one gigabit per second. Additionally, in 2005, 96.8 per cent of South Korean mobile phones had internet access. South Korea offers wireless broadband in major cities. Wibro and HSDPA is the most common technology used in South Korea’s wireless broadband. Many public restaurants offer free Wi-Fi internet during business hours. It is estimated that South Korea has over two million internet addicts, about 8.5 per cent of the Korean web users. In one incident a couple was convicted after starving their baby to death, due to their desire to spend an average of 10 hours per day playing online games in internet cafes.
The above was confirmed by Dr Peter Jack, managing director of Rosemary Total Foundation, based in Lagos and who was an active participant at the Summit. Jack has spent a couple of years in South Korea and has experienced broadband services at close quarters.
In a brief chat with BusinessWorld, he explained the policy situation in South Korea made it possible to achieve the broadband penetration in that country.
He also narrated how blissful it could be to experience broadband services in underground trains at high speed, in homes, schools and en-route via cars, buses, etc.
United States: Broadband is in the Air
For Americans, almost none of whom have access to speeds that many South Koreans take for granted, this difference is considerable. The United States considers itself the centre of technological innovation, yet South Korea has gone considerably further in making a mainstream reality out of the futuristic promises of bygone dot-com days.
Many U.S. executives and policy makers are quick to dismiss the disparity, noting that South Korea’s densely populated areas have made it easier for telecommunications companies to offer extremely fast service to large numbers of people. But even with such geographic and demographic differences, the United States especially developing countries like Nigeria can learn some valuable lessons from South Korea’s experience in jump-starting a broadband powerhouse.
It is, however, projected that within the next few years, some US homes may have a half dozen options for getting broadband service, each with their pros and cons. This include cable, wireless, power line, xDSL, Fibre and Satellite.
On the campus of the University of Southern California, students and researchers are being exposed to broadband uses of another kind.
In a darkened lab, a high-definition video of a space shuttle launch fills a viewing screen. Its sounds shake the floor, rumbling from 10 speakers around the room, each with its own audio stream.
This IMAX-like experience shows the potential for broadband networks in ordinary homes—in movies on demand, virtual reality games and even teleconferencing, said Isaac Maya, the director of Industry and Technology Transfer Programmes at USC.
The shuttle video and all 10 channels of audio—four more than on most DVDs—are streamed in real time from services in Georgia over a super-fast Internet2 network.
This potential is part of what excites visionaries in entertainment and consumer markets. If high-speed internet access becomes ubiquitous, entrepreneurs and media experts have said, the experience of home entertainment, sports, games, communication and anything else connected to the internet will change radically.
They also spoke extensively and passionately on the obstacles confronting broadband penetration in Nigeria which include lack of policy framework for broadband infrastructure development to take place, the lack or regular supply of electricity and claim of right of ways by local and state governments in the process of laying broadband infrastructures in cities. Indeed, about 70 per cent of the problems encountered by the telecom sector with its broad implications for development of broadband infrastructure were traced to the power sector crisis that has been rocking the nation for the past decades without immediate solution at sight.
Speakers also harped on the need for national policy on broadband to enable the industry grows beyond the present limitations and confines. Not unmindful of what the Nigerian Communications Commission has achieved in the last decade, reference was made to the glowing example of South Korea and Kenya (not excluding other examples) of how good policy and good governance could help to engineer and accelerate the rollout of broadband for the benefit of all.
Participants at the summit strongly emphasized and suggested that there is need for more downstream spectrum licensing for broadband penetration and infrastructural development which is considered so critical for the growth of the economy in the coming decade, especially to restructure how we manage the economy, transact business, e.g. e-trade, e-business, even e-management.
Impediment of right of ways was also highlighted as one of the notorious obstacles to laying of fibre optic which is the backbone of broadband. It was strongly advocated that this impediment must be removed to facilitate and accelerate the laying of fibre optic across the country. Indeed, no local, state government or relevant agencies has absolute control over land except for administrative convenience. It is the federal government that has such absolute control. Since, this is national policy that affects all and sundry, local and state governments must be legally compelled to adhere to the law establishing free access to ways to enable telecom operators install infrastructures for the development of broadband services across the country.
The recent example of payment of $52 million for Multilinks’ assets by Visafone must have formed the background that led some of the participants at the Summit to advocate for merger and acquisition in the telecom sector to consolidate the gains already achieved and harness future opportunities in the sector. This advocacy was contained in the goodwill message delivered by Senator Gbenga Obadara at the Summit.
Broadband Impact on GDP
Growth in the data/internet service segment of the sector has not been as significant as those in the voice segment. In most cases, internet services where available, are at best unreliable and characterized by very low speeds. Statistics for broadband penetration in the country as at year end 2010 hover between one and 2.8 per cent of the population of over 150 million.
According to a publication by the World Bank in 2009, for every 10 per cent increase in internet penetration, there is a resultant 1.3 per cent growth in GDP. Further, the 2010 US National Broadband policy document states, “Broadband is the great infrastructure challenge of the early 21st century. Like electricity a century ago, broadband is a foundation for economic growth, job creation, global competitiveness and a better way of life. It is enabling entire new industries and unlocking vast new possibilities for existing ones. It is changing how we educate children, deliver health care, manage energy, ensure public safety, engage government, and access, organize and disseminate knowledge”
Meanwhile, the Nigerian telecom sector was said to have recorded $8.6 billion profits in 2010 becoming the third largest contributor to gross domestic product (GDP) in the non-oil sector, according to Pyramid Research 2010 Report.
Also spending on information technology in Africa has been projected to increase by 10 per cent to $25bn in 2011, according to the International Data Corporation (IDC). The projections are based on the positive growth rates recorded by some African nations especially in the information and communication technology (ICT) sub-sector of the economy.
By 2013, percentage contribution of telecom industry to national GDP in Nigeria is projected to be around six to seven per cent.
It has been estimated that Nigeria will add about $5.55 billion to its annual gross domestic product by 2015 if it implements judiciously the rollout of broadband across the country viz: unlock the 2.6GHz spectrum quickly to support the high demand for mobile broadband in the urban areas; release the digital dividend spectrum to deliver broadband services to rural areas; and reduce the 35 per cent tax level faced by Nigerian mobile operators, a tax which is double the global average
It was also revealed that only six per cent of Nigerians currently has access to broadband services and 74 per cent of these did so through mobile broadband. There is little fixed broadband connectivity outside Lagos and in most Nigerian cities internet service is wireless.
The study stated that mobile broadband could positively contribute more than one per cent of GDP or 1.7 per cent of non-oil GDP as early as 2015 and would facilitate much needed diversification of the economy. According to the report, government support for mobile broadband services could help deliver significant advantages to wider wireless ecosystem and the way in which other sectors use the internet.
The sectors expected to benefit include online retail trade which could witness about 55 per cent annual growth; financial service sector, 95 per cent; health and education by 70 per cent and agriculture and utility services which would experience 55 per cent growth.
Wider availability of mobile broadband could also vastly improve overall industrial productivity through improvements in business processes. A 73 per cent annual increase in the working population with access to mobile broadband reaching 5.2 million by 2015 will deliver an additional $903.3 million to the Nigerian economy each year.
What Broadband can do for Nigeria
The internet broadband width and speed (penetration) is the next big thing and Nigeria cannot afford to lag behind. Nigeria needs to break through the policy and environmental barriers for broadband deeper penetration. This has wider ramifications in all sectors of the economy and social life. In the educational sector, it enables students at secondary and tertiary institutions to communicate freely and exchange ideas through e-portal, e-library to facilitate e-research for cross-breeding and cross-fertilization of ideas.
African researchers and institutions have contributed just nine per cent of international papers across all the Information and Communications Technology and Development (ICTD) disciplines, although this went up to 13 per cent for some topics such as library science and e-governance. In hard sciences such as computer science, this figure fell below one per cent.
It was equally revealed that of the nine per cent of publications containing at least one African author. South Africa contributed over a third of the papers with Botswana and Nigeria contributing 14 and 17 per cent respectively.
Dr Eugene Juwah, executive vice chairman of the Nigerian Communications Commission, explained that “broadband represents huge opportunities for social and economic progress of any nation or people.” It facilitates the delivery of more effective healthcare and banking, better education, smoother and more transparent governance, sustainable environment, more efficient transportation, national security, as well as smarter and more economical energy supplies.
“Robust broadband networks and services have also globally brought about considerable transformation to businesses and markets, significant wealth and growth in economics. Empowerment of individual, organizations and communities are the further resultants. Access to broadband visibly defines how equipped, businesses, people, communities and institutions are to participate in today’s digital and smart global economy.”
In the health sector, broadband can aid surgery and other operations without the physical presence of the resident doctor or physician. There is also telemedicine possibility through teleconferencing, etc.
Lessons from Other Countries
The success story of South Korea in broadband was captured vividly in the life of an English teacher living in Seoul who has had a high-speed internet connection of 8 megabits per second—only about average for a South Korean apartment, but nearly eight times the typical broadband speed in U.S. households. He watches TV shows over this connection, creates multimedia projects for his class and regularly updates a weblog.
None of what he does is revolutionary; it just happens far faster than it would in America. And that’s a little revolutionary all by itself. The Korean government’s clearly articulated vision for modernizing the country’s infrastructure stands in stark contrast to the regulatory morass that has stunted development in the U.S telecommunications industry for several decades.
South Korea’s policy, the cornerstone of a national technology initiative to help revive a devastated economy, has created true broadband competition, which, in turn, has helped prices fall and speeds rise.
Although its economy is still struggling, South Korea has made significant progress with many forms of digital technology. Citizens can get “video on demand” online for less than what Americans pay to rent a DVD. Low-income students use high-speed net connections to take free tutorials for the national aptitude test and SAT-like exam that can determine college admissions and future job paths.
South Korea has emerged to become the world leader in internet connectivity and high speed. It was able to achieve this because the government had established policies and programmes that facilitated a rapid expansion and use of broadband.
The internet has a higher status for many Koreans than it does in the West. And upon realizing this indicator, the government actively supported it. South Korea’s broadband network is the fastest and according to the Information Technology and Innovation Foundation the most developed in the world. Particularly Seoul, the nation’s capital, has been called “the bandwidth capital of the world”. In January 2006, it became the first country to achieve over 50 per cent broadband penetration per capita. By 2005, it was the first country to complete the conversion from dial-up to broadband.
It also has the cheapest, fastest broadband in the world. Now there are experiments with speeds of one gigabit per second. Additionally, in 2005, 96.8 per cent of South Korean mobile phones had internet access. South Korea offers wireless broadband in major cities. Wibro and HSDPA is the most common technology used in South Korea’s wireless broadband. Many public restaurants offer free Wi-Fi internet during business hours. It is estimated that South Korea has over two million internet addicts, about 8.5 per cent of the Korean web users. In one incident a couple was convicted after starving their baby to death, due to their desire to spend an average of 10 hours per day playing online games in internet cafes.
The above was confirmed by Dr Peter Jack, managing director of Rosemary Total Foundation, based in Lagos and who was an active participant at the Summit. Jack has spent a couple of years in South Korea and has experienced broadband services at close quarters.
In a brief chat with BusinessWorld, he explained the policy situation in South Korea made it possible to achieve the broadband penetration in that country.
He also narrated how blissful it could be to experience broadband services in underground trains at high speed, in homes, schools and en-route via cars, buses, etc.
United States: Broadband is in the Air
For Americans, almost none of whom have access to speeds that many South Koreans take for granted, this difference is considerable. The United States considers itself the centre of technological innovation, yet South Korea has gone considerably further in making a mainstream reality out of the futuristic promises of bygone dot-com days.
Many U.S. executives and policy makers are quick to dismiss the disparity, noting that South Korea’s densely populated areas have made it easier for telecommunications companies to offer extremely fast service to large numbers of people. But even with such geographic and demographic differences, the United States especially developing countries like Nigeria can learn some valuable lessons from South Korea’s experience in jump-starting a broadband powerhouse.
It is, however, projected that within the next few years, some US homes may have a half dozen options for getting broadband service, each with their pros and cons. This include cable, wireless, power line, xDSL, Fibre and Satellite.
On the campus of the University of Southern California, students and researchers are being exposed to broadband uses of another kind.
In a darkened lab, a high-definition video of a space shuttle launch fills a viewing screen. Its sounds shake the floor, rumbling from 10 speakers around the room, each with its own audio stream.
This IMAX-like experience shows the potential for broadband networks in ordinary homes—in movies on demand, virtual reality games and even teleconferencing, said Isaac Maya, the director of Industry and Technology Transfer Programmes at USC.
The shuttle video and all 10 channels of audio—four more than on most DVDs—are streamed in real time from services in Georgia over a super-fast Internet2 network.
This potential is part of what excites visionaries in entertainment and consumer markets. If high-speed internet access becomes ubiquitous, entrepreneurs and media experts have said, the experience of home entertainment, sports, games, communication and anything else connected to the internet will change radically.
