[kictanet] IG Discussions- Day 2 of 10: Infrastructure Issues-Submarine Cables

Tue Apr 28 11:14:36 EAT 2009

Hi Walu/All,

Interesting points and arguments but clearly brought from outside of the
service provider industry. My comments follow:

On Tue, Apr 28, 2009 at 8:20 AM, John Walubengo <jwalu at yahoo.com> wrote:

> i) Access:- Score=1, Low Impact on Access
> The undersea cable is a top-tier infrastructure that has no impact at the
> (User) Access level.  User access level is a function of the maturity of the
> domestic(local) infrastructure.  Unless this is developed proportionately,
> we shall have an an awkward situation similar to a country with top-notch
> Universities (Submarine cable) but no Primary and Secondary Schools to
> provide the students (no Access)...

Access is not merely an infrastructure related issue. True, tier 1 is where
the submarine cables impact - but the truth is that currently most of the
deployed access infrastructure is underutilised. There are over 100,000
households today with ability to access ADSL - but only a fraction (probably
2,000-3,000) actually subscribe to the service - why? Cost - more below

>
>
> ii) Affordability: Score= 2,Moderate Impact on Internet Service Costs.
> Yes, the prices are likely to go down from the current retail levels of
> about 2500USD per 1MB to btwn 500-1000USD per 1MB of bandwidth.  But I have
> serious doubts if this prices will be sustained at these low levels because
> the investors in these cables are not in it for fun - they have calculated
> ROI targets that anticipate a huge uptake of the bandwidth.  In the likely
> event that this uptake failes to happen, I see prices beginning to go up by
> the end of the 1st year of the cable operation.  The investors in the cable
> will then begin to milk the few subscribers who may have jumped onto the
> highway in order to pay for the cost of the capital sunk into the cables.
>  Yes, maybe I just cant get over the nasty SAT3  experience where the
> submarine fiber cable landed in the West African region with little impact
> on pricing.

Actually the expected impact on pricing will be between US$200-$400 per MB
(wholesale for ISPs) - this will further be forced downwards by the high
competition that both shareholders as well as bulk customers of the cable
systems bring to the marketplace.

Don't forget that TEAMs is a 'developmental' cable system i.e. it's
investors are not aiming to make any money out of the cable itself - but aim
to deliver the commodity (bandwidth) to their marketplace at the lowest
possible price, then make their returns on the better margins they will get
in the market.

Contrary to your expectation, there are chances that broadband access might
be very close to free.

> iii) Content: Score=1, Low Impact on Content.
> Incidentally, digital content should be independent of infrastructure.  I
> mean, we do not need the submarine cable for our Lecturers at the
> universities to have their notes in digital form. We do not need the
> submarine cable to digitize government records.  Content is intricately
> related to eventual cost of Internet Service and ideally should be fully
> developed before the submarine cable.
>

Content vs Infrastructure is a chicken & egg situation - at least once the
infrastructure is there - there shall be few or no more excuses for the lack
of local content. Bottom line is, we have a lot of creativity - it needs to
be harnessed, there are definitely huge business opportunities for 'content
agreggators' who can go out there, source and sign up various types of
content and put it onto the new networks.

>
> iv) Quality. Score=2, Moderate Impact on Internet Quality.
> "Broadband Quality of Internet" is what every service provider is screaming
> about. But Broadband standard in .KE is way off the mark when compared to
> India or Europe. I will remain sceptical until proven otherwise but I forsee
> the undersea cable having moderate impact on quality because of our poorly
> managed domestic User and  Telco networks. Most Telco networks that will act
> as gateways to the submarine cable are full of Viruses, Spam, Proxies, and
> ill-configured Servers, Routers and Switches that introduce congestion and
> bottlenecks rather facilate broadband access to the Submarine cable.

On this one I can assue you that this assumption is way off-mark. The
watershed that these submarine cable will bring, plus the almost limitless
amounts of bandwidth that will be available will have an incredible impact
on quality. All the 'pent-up-demand' that has been created by the terribly
slow satellite systems we use at the present will be released - there is
likely going to be an explosion of use - with a massive increase in overseas
multimedia and web 2.0 services. Hopefully this will gradually become more
localised as many of the content delivery networks set up local nodes for
mirrored and 'local presence' service equivalency.

-- 
Brian Munyao Longwe
e-mail: blongwe at gmail.com
cell:  + 254 722 518 744
blog : http://zinjlog.blogspot.com
meta-blog: http://mashilingi.blogspot.com
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