Wednesday, October 17, 2007

The Truth behind the 'Digital Divide'

Have you ever really wondered why monthly costs for internet access in so expensive in Ghana and most of Sub-Saharan Africa. I mean most offers for monthly access are quoted in US Dollars and compared to charges in UK and US (which I can totally afford) we are paying an arm, leg and maybe a little of our hearts.

I stumbled upon an article and I am not referring to but stumbling in a literal sense, which is how I find most juicy stuff on the net. The article is called The Halfway Proposition and highlights the most important issue in the eyes of African ISPs as to what creates high end-user costs for internet access, 'Reverse Subsidy'. ‘Reverse Subsidy’ refers to African ISPs paying for both direction of traffic over the internet backbone.

The Problem
Obtaining upstream connectivity requires African Internet Service Providers (AISPs) to purchase bandwidth from International Backbone Providers (IBPs). Typically 90% of an AISPs upstream cost is the physical link from them to the IBP’s country and 10% is the cost of purchasing IP Bandwidth once they get there. Whether the service is purchased as a bundle or separately the AISP pays 100% of the International carrier to get from Africa to the IBP network and then 100% of the Internet bandwidth cost. This amounts to a reverse subsidy of IBP connectivity costs by AISPs.

When an end user in Kenya sends E-Mail to a correspondent in the USA it is the Kenyan ISP who is bearing the cost of the International connectivity from Kenya to the USA. Conversely when an American end user sends E-Mail to Kenya, it is still the Kenyan ISP who is bearing the cost of the International connectivity, and ultimately the Kenyan end user who bears the brunt by paying higher subscriptions. Simply put “If you (AISP) want service you have to come to me, if you don’t want to come to me – that’s fine, I’m not paying to come to you…."

The Solution

The Halfway Proposition is a strategy that borrows the experience of Asia and adapts it into a realistic strategy for Africa. Redressing the balance through regulation by the ITU is not the way forward. It would be far better to allow the process to be driven by the private sector.

Step 1 – Create Traffic Aggregation within Africa
i. Through the creation of Internet Exchange Points
ii. Through the emergence of Regional Carriers facilitating regional peering

Step 2 – Create Digital Arteries to carry the traffic
i. Regionally. Regional Fibre Optic Infrastructure to reduce the costs of regional peering
ii. Internationally. International Fibre Optic Infrastructure to reduce the costs for IBPs to establish Point-of-Presecence at Points of Aggregation in Africa.

Since the article and the idea was conceived in October 2002 it has been almost 5 years and progress has been made.

Hip Hip Hooray

Step 1 – Create Traffic Aggregation within Africa
  • Internet Exchange Points (IXPs) have been created in 10 countries with some like South Africa and Nigeria having more than more IXP. Ghana launched its IXP called GIXP on Tuesday 18th October 2005 at the Ghana India Kofi Annan Centre of Excellence. The GIX is run and operated by the Ghana Internet eXchange Association (GIXA, an independent non-profit corporation establish by the Ghana Internet Service Providers Association (GISPA, and other stakeholders interested in joining and growing the GIX.
  • Regional Carriers have been selected by the African ISP association, AfrISPA, in response to its Request for Service for data transport between the different ISP members of local Internet Exchange Points. Transtel, a division of Transnet Limited and Africa Online/SkyVision are the two bidders that successfully met the Request For Service (RFS) criteria to provide an African Regional Internet Traffic solution. The peering point design can be extended to allow additional Internet Exchanges to join the network with ease at any time in the future.
Step 2 – Create Digital Arteries to carry the traffic

Regional and International Fibre optic Infrastructure. The existing SAT3/WASC/SAFE able is fast running out of bandwidth to support access and several new initiatives have arisen.

o Teams (The East African Marine System): Kenya has awarded an $82m undersea internet c able project to the French-American company Alcatel-Lu cent.
Teams will be owned by the Kenya Government (up to 40%), while Etilsat of the United Arab Emirates will hold a 20% stake. Private investors - yet to be secured - will hold 40%. The cable will run from Fujairah in the UAE to Mombasa, Kenya.

o EASSY (The East African Submarine Cable System): This is an initiative of various telecom companies in eastern and southern Africa

o The SEACOM marine cable system: The planned 13,000 km undersea fiber optic network will provide connectivity between South Africa, Madagascar, Mozambique, Tanzania, Kenya, India and Europe. Owned by the American Heracles Telecom, SAECOM’s planned commissioning date is the first quarter of 2009.

o The NEPAP Broadband Initiative Network is also currently underway after it broke away from the ESSAY initiative

In conclusion, unfair and unjust arrangements for upstream connectivity to the internet which made end-user costs in Africa high, have spurred great innovation and cooperation between the private and public sector to obtain our own internet backbones, this in the long-term is more beneficial. It must however be noted that most of these projects have been delayed due to differences in opinion on the business model to be used for operation and lack of ratification by all the possible participant countries. Politicians will always be Politicians.