Commercial opportunities for providing communications infrastructure in low-income developing countries

["Irfan Khan" <khania@super.net.pk>]

Commercial opportunities for providing communications infrastructure
in low-income developing countries

by David Souter and Mike Jensen for the Commonwealth
Telecommunications Organisation

Uploaded on Tuesday 05 December 2000


Summary

This paper looks at commercial aspects of telecommunications
infrastructure development, particularly the question of how
technological changes are enabling access to be provided in low-
income countries on commercial terms. It focuses on Africa, which is
the continent of prime concern for Imfundo .

African telecoms demand differs from that in industrial countries
because of prevailing low incomes and the high proportion of
population living in rural areas. There are also substantial
differences in the business, regulatory and other environments for
telecoms investment in different countries. However, the commercial
viability of new network deployment is benefiting everywhere from
changes in technology which have reduced the average cost of line
deployment in Africa by about 75% in the last few years.

New commercial opportunities arise for both broadcasting – the
dominant mass medium in Africa – and telecommunications/internet
provision as a result of lower network costs and greater competition
between network providers.

Section 2.2 of the paper describes new initiatives for
telecommunications network provision in Africa, including the
provision of broadband infrastructure, satellite-based services,
international voice services , mobile telephony, wireless local loop
networks, and the development of public access through state-
sponsored and commercial telecentres. This illustrates how the
diversity of new technological options is making it easier and
cheaper to deploy networks that can prove commercially viable in
relatively low-income, low-demand areas.

Commercial opportunities for Internet service provision are also
affected by differences in national business and regulatory
environments. Section 3 looks at ways in which local entrepreneurs
and Internet users are finding ways to offer services that meet
demand, especially for lower-bandwidth Internet services like email.

In conclusion, it is clear that substantial new commercial
opportunities exist for the provision of broadcast,
telecommunications and Internet in low-income African countries, that
there is increasing experience of successful business models on which
to draw, and that public access could in future be provided in much
of Africa by commercial means. The regulatory framework within which
communications businesses operate is clearly important in determining
how extensive these opportunities and this potential are in different
countries. There will remain areas, however, in which the prospects
for commercial access provision are limited by low population density
and high investment costs. In these areas, in particular, the search
for lower-cost commercial initiatives must coexist with governmental,
regulatory and international agency support.


read complete paper at
http://www.imfundo.org/souterfourteen/contents.htm