[kictanet] Bringing down the cost of Internet

[Bitange Ndemo]

Listers,

I am in Nigeria for the launch of the Global Alliance for Affordable
Internet (A4AI) which I was appointed the Honorary Chair.  This is a
diverse and truly global coalition committed to driving down the cost of
internet access in less developed countries. We believe that, while
technological solutions are advancing rapidly, policy and regulations
remain a significant barrier to affordable internet. A4AI seeks to create
the conditions for open, competitive and innovative broadband markets
through a combination of advocacy, research and knowledge-sharing. When we
succeed, we will help to lower access costs to meet the UN Broadband
Commission target of broadband access priced at less than 5% of monthly
income, thereby helping billions more to come online and unlocking
significant socio-economic benefits.

Why is A4AI needed?
“Estimates suggest that as much as two-thirds of the world’s population is
not connected to the internet, with penetration rates in less developed
countries averaging around 31%. In Africa, this figure drops to 16% (while
in in Kenya we are approaching 40% Liberia is at .5%) and in the world’s
49 least developed countries, over 90% of people are not online. (Source:
ITU 2013) and (Broadband Commission 2013)

 “Most often, this is for affordability reasons. In developed nations, the
average cost of broadband internet access is around 1-2% of monthly
household income - less than a daily coffee. In less developed countries,
this figure skyrockets to over 30%, and in 17 countries a basic internet
connection can cost well over 100% of average monthly income. Overcoming
this digital divide is critical so that technology and innovation can be
harnessed to accelerate progress in areas such as education, food
security, job creation, public health, and gender equity.”

On A4AI’s goals:

“Our primary focus is to reach the UN Broadband Commission Broadband
Target of entry-level broadband services priced at less than 5% of average
monthly income. In doing so, we hope to enable billions of people to come
online (with a particular focus on low-income countries) and make
universal access a reality.
On Strategy:

“Innovative technological solutions to affordability challenges are
progressing apace. However, the best technologies in the world can’t drive
change if quasi-monopolies or regressive policies prevent them from being
implemented. Changes to policy can deliver impressive results, fast. So,
through a combination of advocacy, research and knowledge-sharing, A4AI
will drive policy change by seeking to create the conditions for open,
competitive and innovative broadband markets. We are unique in pursuing
this approach.”

On Specific Activities:

“A4AI is focused on creating conditions for open, competitive and
innovative broadband markets via regulatory and policy change. Activities
include: original research (including the publication of an annual
Affordability Report); publication of regulation and policy best
practices, and illustrating these via case studies; and in-country
engagements including networking and knowledge-sharing. We will work
closely with national governments – three to four countries in year one,
expanding to 10 - 12 in years two and three.”

How are policies keeping prices high?

There are numerous examples of how policies keep prices high. Here are
just a handful:
• Luxury taxes: Tax accounts for more than 20% of the total cost of mobile
ownership in at least 13 African countries. (Source: GSMA 2011)  Tax
reductions on PCs in Colombia have increased PC penetration by 100% in 2
years, and Internet penetration increased 466% from 2005-2008, versus 161%
across the region (source: IDC Colombia 2009).
• Access to international gateway: In 8 of 20 African countries surveyed
by ISOC there is little or no competition on the international gateway. In
the same survey, only one of the 20 countries has fully privatized their
incumbent telecoms company. In South Africa firms began deploying
open-access metro fibre in 2009, and also furnished a link from
Johannesburg to the SEACOM (undersea cable) landing station in order to
avoid very high charges proposed by Telkom (the state-owned operator).
This helped to slash international capacity prices by over 60%.
• Universal Service Funds (USF) for Broadband (example of how policy can
lower prices): USFs and similar subsidies improve the availability and
affordability of broadband for unserved or underserved citizens.
Historically focused on basic telephony services in remote areas, USFs are
now being adapted to promote the adoption of broadband by subsidizing
content, devices, services, and digital training, as well as
infrastructure. USFs can serve as a tool to stimulate demand and increase
adoption and use.

About A4AI’s membership base:

“A4AI is a diverse coalition of over 30 private sector, public sector, and
not-for-profit organizations who have come together to advance the shared
aim of affordable access to both mobile and fixed-line Internet in
developing countries. We are the first truly global coalition to tackle
this issue and our members are from both developed and less developed
nations. The World Wide Web Foundation, established by web inventor Sir
Tim Berners-Lee, initiated the Alliance.”

1. What, exactly, will A4AI do?

A4AI will undertake a blend of international advocacy and research,
coupled with on-the-ground work. We’ll be working in three pioneer
countries by the end of 2013, and will bring together in-country
stakeholders to identify obstacles, how to tackle them and we’ll then help
to drive implementation. We will be developing advocacy and policy
proposals in conjunction with these stakeholders in each country. We will
also continue to press at international level on these issues and our work
will be informed by original research – with the first edition of our
Annual Affordability report being released in December 2013.  We’ll also
publish case studies, position papers and briefings on lessons learned
throughout the year to share knowledge.

2. What is the relationship between Internet.org and A4AI?

While A4AI and Internet.org are two separate organisations, there is a
common goal (in addition to common partners in Facebook and Ericsson) of
making internet access available to more people around the world.  A4AI
has a clear focus on policy and regulatory issues surrounding access while
Internet.org is focused on identifying technical innovations and new
business models that can help drive down the cost of data.  Wherever
possible, we will we collaborate to maximise impact.


Regards.


Ndemo.