Overcoming traditional infrastructural and market challenges to offer ubiquitous and affordable connectivity in Africa and create the conditions for such digital transformation is, plainly, a generational challenge. It is one that calls for a transformational mix of increased capital investment, innovative technology, and business models, fresh approaches to mobilizing capital and close collaboration between governments and their international partners, the private sector and civil society.
Capital requirements to achieve deeper and more inclusive access to broadband in Africa are considerable. Provisional estimates developed as part of the World Bank Africa Digital Moonshot project put investment requirements to achieve universal access to broadband in Africa at upwards of $100 billion over the next decade. This would include building and maintaining broadband networks, building the user skills and local content foundations necessary to ensure adoption, and establishing policy and regulation frameworks that foster extensive and inclusive broadband adoption.
Expanding Africa’s access to last mile connectivity requires more than mere capital. New technology deployment approaches are needed to extend the reach of last mile connectivity to areas or income groups where commercial viability has typically been in question. Many have been deployed or are under exploration. In Kenya and Nigeria, internet providers like Mawingu and Tizeti are rolling out agile, extensive hotspot networks in low-income and remote areas as a cost-effective alternative to traditional solutions. In Rwanda, Vanu Networks uses solar-powered, low-capacity small cells to provide connectivity to remote rural areas, at a fraction of the capital and operating costs incurred by traditional models.
Likewise, the potential of airborne solutions such as balloons or drones is gaining more attention. In Kenya, Google sister company Loon has partnered with Telkom Kenya to explore the provision of connectivity from balloons floating 20 km above sea level. HapsMobile, a Softbank company, has developed a solar-powered drone that aims to deliver connectivity at 5G speeds to hard-to-reach locations. High Throughput Satellite (HTS) ventures like Oneweb and SpaceX are emerging to challenge the traditional economics of delivering satellite bandwidth to remote locations.
Achieving pervasive and affordable last mile broadband connectivity is also about upending traditional models in markets where consumer average monthly spend on ICT is typically lower than $3.00 a month. Serving low-income, bottom-of-the-pyramid consumers in an economically sustainable manner requires new, hybrid models that redefine stakeholder relationships and better spread the risk between market participants.
For example, an increasingly popular approach to deploying fiber networks in Africa is the co-investment model, whereby companies that are otherwise competitors combine forces to bring down the initial capital expenditure required to roll out a fiber network. Likewise, emerging wholesale mobile broadband network models aim to optimize broadband investment by emphasizing infrastructure sharing and refocusing the role of various actors in the broadband value chain. At the retail level, models that lower the initial cost of access (potentially through free user packages) to foster adoption in larger volumes are garnering increased attention.
Innovative approaches to financing the deployment of African ICT infrastructure are also vital, in light of the extensive scale of investment required and the inherent complexity of large-scale ICT projects. New approaches include an increase in the amount of financing allocated to smaller, often transitional projects to secure small, but highly impactful, wins, integrating digital access as a cross-cutting component of larger infrastructure projects (e.g. in the energy, transportation or health sectors), or optimizing the use of government incentives to attract private capital and improve the rural project business case.
Key Internet Infrastructure Segments (Source: World Bank; World Digital Report, 2016)
It is also important to note that closing the African digital gap is about more than mere investment in infrastructure. The actioning of critical policy levers, notably with respect to network infrastructure sharing, spectrum, or taxes can materially increase the viability of ICT projects. In addition, investments in building skills and local content are especially vital, to drive adoption and provide foundational demand for the ICT infrastructure. As capital, technology and African innovation come together, African markets find themselves at the onset of a new phase of transformation of their digital infrastructure. And it all starts with developing extensive, affordable last mile broadband connectivity and innovative delivery models. There is much at stake, and the challenges are considerable – but so are the opportunities to build the foundations for closing the connectivity access gap and enabling Africa’s effective participation in the fourth industrial revolution.
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