Part I Understanding the local context and leveraging the available - - PowerPoint PPT Presentation

MK689

Part I – Understanding the local context and leveraging the available ICT technologies

Development of a national broadband strategy in the Middle East and Africa

9 June 2012 • David Eurin

MK689

Introduction Understanding the local context Leveraging the available ICT technologies Conclusions so far … this afternoon: roadmap for a national broadband strategy

Contents

2

MK689

Analysys Mason has helped many countries to develop or refine national broadband plans

3

Ireland 2006-12: Design, procurement and implementation support for the EUR 234m National Broadband Scheme UK 2001 onwards: Broadband planning for regional development agencies on the UK UK 2005-2006: Development of broadband scenarios for the BSG in the UK UK 2008 onwards: support to Cornwall council in its Next Generation Broadband project UK 2008: Broadband stakeholder group models for efficient public sector interventions in next generation broadband Wales 2004 -2010: Commercial and technical strategy, business planning, procurement and implementation support as part of National fibre broadband initiative Malta 2011: Techno-economic feasibility of a national FTTH network Wales 2006: Study to promote public intervention in “second generation broadband” market UK 2010 onwards: Cost modelling of next-generation broadband and regional funding allocations Italy 2001-2002: Analysis of government intervention mechanisms and prioritisation for broadband task force US 2002-2003 : Study of US broadband policy for TechNet India 2010: Strategic road- mapping and assessment of drivers for the deployment

• f a national fibre- optic

backbone in India Chile 2007-2009: Broadband promotion study in Chile Malaysia 2002-2003: National broadband policy development Gulf 2010: Regulatory support in major Gulf country to define three- year internet development plan New Zealand 2010 - 2011: Technical and cost reviews underpinning the Government’s national Ultra-Fast and Rural Broadband strategies Australasia 2010- 2011: Operator support to become national partner for ultra- fast broadband solution. Subsequently carried out review of solution and identification of global best practice European Commission 2010- 2011: Developed a guide for investment in broadband infrastructure, covering small regional roll outs and national interventions alike Norway 2002: Assessed the potential social and economic benefits from a scheme to provide broadband to selected public sector sites Singapore 2005-2006: Provided support on Next Generation Broadband Network Initiative Western Europe 2004: Analysis of Internet access prices in Western Europe Thailand 2009: Development of national broadband plan Brunei 2009-2010: Development of national broadband strategy Lesotho 2012: Development of national broadband plan EMEA 2011: National broadband market assessment, benchmarks and forecasts Australia 2009: STEM license, training and modelling assistance for National Broadband project Israel 2011: Technical audit of national broadband solution used to evidence international competitiveness and sufficient investment capability to the Government Egypt 2008: Provided commercial and technical fixed licence bid support addressing i.a. national broadband requirements. Libya 2009: Provided commercial and technical fixed and wireless licence bid support addressing i.a. national broadband requirements. EU 2011 onwards: Socio-economic benefits of broadband in 27 EU countries and private sector funding analysis Morocco 2011: National action plan for the development of broadband

MK689

Introduction Understanding the local context Leveraging the available ICT technologies Conclusions so far

Contents

4

MK689

Governments and banks use simple indicators

• To make high-level investment decisions, different situations must

be compared and benchmarked Only consistent indicators are useful Therefore few indicators are used in practice

• This does not reduce the need for an extensive set of indicators

to be studied by academics and economists Local issues Specific reviews

5

MK689

Broadband economics are driven by density

6 Source: Euromonitor, Analysys Mason Proportion of total land area holding 90% of the population Population density in selected countries

0% 10% 20% 30% 40% 50% 60% Egypt Algeria Israel Morocco Jordan Tunisia Gaza / West Bank Syria Lebanon % of area 100 200 300 400 500 600 700 800 Gaza / West Bank Lebanon Israel Syria Egypt Jordan Tunisia Morocco Algeria

• Inhab. per sq.km

MK689

Demand for broadband is driven by wealth

7 Source Euromonitor GDP per capita at PPP (2010)

5,000 10,000 15,000 20,000 25,000 30,000 35,000 Israel Lebanon Tunisia Algeria Egypt Jordan Syria Morocco Germany United Kingdom France Spain Italy Greece Cyprus Malaysia Botswana South Africa Thailand Ukraine Georgia EUR at PPP

FEMIP countries Other countries

MK689

Fixed broadband is rare in the region …

8 Source: TeleGeography, Euromonitor Fixed broadband penetration of households (2010)

0% 10% 20% 30% 40% 50% 60% 70% 80% Israel Lebanon Jordan Tunisia / West Bank Algeria Morocco Egypt Syria France Cyprus United Kingdom Germany Greece Spain Italy Malaysia Georgia Thailand Ukraine

• uth Africa

Botswana % of households

DSL, cable, fibre (FTTC, FTTH), fixed WiMAX and satellite technologies

MK689

… but mobile networks reach most people

9

0% 20% 40% 60% 80% 100% 120% 140% Israel Jordan Tunisia Morocco Algeria Egypt Lebanon / West Bank Syria Cyprus Italy Greece Germany Botswana Spain United Kingdom Malaysia Ukraine Thailand Georgia

• uth Africa

France % of population

Benchmarks of mobile penetration of population (2010)

MK689

Prices are a lead indicator for take-up

10 All in 2011 (mid-year) Prices for the cheapest mobile broadband offers Prices for fixed broadband offers of up to 1Mbit/s

10 20 30 40 50 60 70 Lebanon Syria Algeria Jordan Israel Gaza / West Bank Tunisia Egypt Morocco EUR per month 10 20 30 40 Syria Israel Tunisia Jordan Morocco Egypt EUR per month

MK689

Total broadband penetration is still too low

11

0% 20% 40% 60% 80% 100% 120% 0.0 0.5 1.0 1.5 2.0 2.5 3.0 Egypt Israel Morocco Algeria Tunisia Jordan Lebanon Syria Gaza / West Bank % of households Subscribers (million) Fixed broadband subscribers Mobile broadband subscribers Broadband penetration

Broadband subscribers and household penetration (2010)

MK689

Introduction Understanding the local context Leveraging the available ICT technologies Conclusions so far

Contents

12

MK689

13

Technology Features Fibre-optic cable Highest capacity available, and highest cost of deployment; main choice for backhaul and core networks Copper-based DSL Much lower bandwidth than fibre; most practical where copper networks exist Fixed wireless Cost-effective widespread population coverage; HSPA+, LTE and WiMAX can offer peak speeds similar to DSL Mobile broadband Same economics as fixed wireless networks, but lower capacity, aimed at smaller devices; most practical where mobile networks already exist Satellite broadband Offers ubiquitous services; very substantial investment, but wide geographical coverage (sharing)

Public and private players can leverage different ICT technologies to offer broadband

MK689

These technologies have different economics

14 Illustration of the revenue-density approach

• 50%
• 40%
• 30%
• 20%
• 10%

0% 10% 20% 30% 40% 50% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Internal rate of return (%) Population coverage (%) DSL FTTC FTTH WiMAX HSPA HSPA+ LTE

Viable areas Non- viable areas

Urban Rural

MK689

Fixed and mobile broadband costs vary (different outcomes and services)

15 Source: Analysys Mason Evolution of total coverage costs for FTTC Evolution of total coverage costs for LTE

0.0 0.2 0.4 0.6 0.8 1.0 EUR (billion) Morocco Algeria 0.0 0.5 1.0 1.5 2.0 EUR (billion) Morocco Algeria

ICT indicators should include supply-side metrics, such as the total cost of ownership of specific technologies

MK689

Not one technology, but a combination

• The best overall solution will usually combine several

technologies, involving a trade-off of cost, performance and reach that is considered appropriate for each context

• The most suitable mix depends on

the economics of the technologies being considered the geography and population of the country concerned the services to be provided to different users and prices the objectives of the country and the budget available

• Governments and investors need ICT indicators to make these

decisions

16

MK689

Introduction Understanding the local context Leveraging the available ICT technologies Conclusions so far

Contents

17

MK689

Conclusions from Part I

• A sound national broadband strategy will

be based on the local context (i.e. some key ICT indicators) leverage specific strengths of ICT technologies not be the same as strategies in other countries, but unique have clear objectives, ambitions and budget

18

MK689

... and still to come in Part II (this afternoon)

• How to build a successful national broadband strategy

roadmap and approach outline of the national broadband strategy document

19

MK689

Contact details

20

David Eurin

Partner, Head of Africa david.eurin@analysysmason.com Analysys Mason Limited Bush House, North West Wing Aldwych, London WC2B 4PJ, UK Tel: +44 (0)845 600 5244 Fax: +44 (0)20 7395 9001 www.analysysmason.com