|Issue:||Africa and the Middle East 2015|
|Topic:||Marseille: European gateway to the Middle East and North Africa|
Franck Simon, Managing Director, France-IX Services
Franck Simon has been Managing Director of France-IX Services since its inception in 2010 and brings his extensive industry experience to the management and ongoing development of the non-profit association Internet exchange point.
Prior to taking up his role at France-IX, Franck was the Technical Director of RENATER, the French academic network, where he worked for almost 15 years. As part of his duties at RENATER, Franck held responsibility for the SFINX (Service for French Internet exchange), the first Internet exchange point ever created in France, for more than 10 years.
Franck has in-depth experience in wide area networks (WAN) and of backbones operators as well as being knowledgeable about the strategies and policies for interconnection between operators and the context of peering in France and in Europe. Since 2012, he has also been involved in the AFNIC’s (Association française pour le nommage Internet en cooperation) scientific committee and its contribution to the definition of future trends in internet infrastructure.
The France-IX organisation is based on the non-profit association model, which enables all its members to vote for strategic decisions and thus contribute to the evolution of services and budget. It also ensures the neutrality and longevity of the Internet Exchange Point.
Using submarine cables to open up the MENA region to broadband technology and the economic advantages it delivers is analogous to the impact that opening up the Suez Canal had on trade in the late nineteenth century. Then, as now, the French maritime city of Marseille has strategic advantages for trade in the region.
The Middle East and North Africa (MENA) region, while close to Europe geographically, can be worlds apart technologically. MENA is a wildly diverse region featuring both extreme wealth and oppressive poverty, it spans 22 countries and has a population of over 430 million people. Average internet penetration stands at 50 percent (some 20 percent lower than Europe), but mean averages for a region as diverse as MENA are misleading, war torn and troubled areas such as Syria, Yemen and Iraq can be well under 30 percent, with wealthier stable states such as the UAE, Qatar and Bahrain well into the 90th percentile according to Internet World Stats.
Internet connectivity, broadband as oppose to dial-up, is a vital ingredient for sustainable economic development. The World Bank states that broadband is “strategic to the goals of reducing poverty, enhancing job opportunities, and fostering trade integration”. The World Bank estimates that for every percentage point increase in the number of internet users, there is a boost in exports of 4.3 percentage points. This is because broadband increases domestic productivity, helps the development of new types of business, is an enabler of democracy and social transformation, and consequently increases much needed levels of foreign investment.
Connectivity across the MENA region is a huge challenge. Struggling economies, political instability and financial uncertainty have resulted in underdeveloped fixed line terrestrial telecommunications infrastructure. But things are changing, and mostly as a result of increased access to submarine cables originating across the Mediterranean in Southern Europe.
Using submarine cables to open up the MENA region to broadband technology and the economic advantages it delivers is analogous to the impact that opening up the Suez Canal had on trade in the late nineteenth century. Then, as now, the French maritime city of Marseille has strategic advantages for trade in the region. It is no coincidence that Marseille has the single most submarine cables (eight) landing at its port than any other Mediterranean European location and why Marseille has more datacentres (eight) than any other city with submarine cable connectivity – with the notable exception of Barcelona which currently has 13 data centres, however, it has only a single submarine cable landing station – and it does not connect with MENA).
The significance of having more cables landing and more data centres to choose from is not just a reflection of a city’s internet maturity, it is a distinct advantage when it comes down to both scale and expertise. Because there is more choice, costs are more favourable, which encourages greater volumes of trade, and because this is all happening in the same place, it encourages people with the right skills and connections to come and do business in the area. Marseille has gained critical mass in connectivity and so growth has become self-fulfilling.
Culturally, France (and Marseille in particular) has very strong links to North Africa, links that are bonded in a common language. As a consequence massive demand for French language content in North Africa is helping to cement broadband connectivity between the two areas.
The Middle East is a different matter. The cultural and connectivity bond between North African countries and their direct neighbours in the Middle East is weaker than the link between Europe and the Americas. But the Middle East is, from a trading standpoint, of greater interest than North Africa to most (non-French speaking) Europeans and Americans. The natural route then to do business with the Middle East is not via terrestrial cables in Africa, but via submarine cables in Europe with Marseille providing the natural port of origin.
But there is more to connectivity than cabling and data centre availability. Internet Exchange Points (IXPs) are the hubs that bring it all together. An IXP is a shared, physical facility where users, such as Internet Service Providers (ISPs), wholesale carriers and communications service providers (CSPs), can connect or “peer” with one another to exchange internet traffic. IXPs are managed by a single party, facilitating mutually beneficial peering between network providers and the cost-effective routing of traffic to different destinations.
The role of the IXP is to ensure the smooth and efficient routing of traffic between the millions of private, public, academic and business networks that make up the internet. In doing so, an IXP enables end users to connect to the internet anywhere, accessing sites that may be hosted on a local network or on the other side of the world. Without IXPs, the internet could not function as the cost and complexity of routing traffic would be too high, furthermore there would be a significant impact on performance.
By connecting providers, IXPs reduce the number of “hops” (the path between a source and its destination), ensuring that services such as video streaming, file sharing and more can be accessed by the end users more quickly.
IXPs also deliver improved flexibility for network providers as a competitive IXP marketplace offers a great deal of peering options, with ISPs, carriers and CSPs all able to evaluate each other’s services and decide whose offerings are best suited to their needs.
There are both for-profit and not-for-profit models of IXPs. The former, offered by commercial firms, are usually one aspect of these firms’ overall infrastructure service. Not-for-profit IXPs are usually established as cooperative organisations when network providers come together to set up this mutually beneficial service.
The number of IXPs globally has grown from around 300 in 2009 to over 440 in 2015 according to figures from Packet Clearing House (PCH) - a non-profit research institute that supports operations and analysis in the areas of internet traffic exchange, routing economics, and global network development. PCH estimates that one new IXP is added to the worldwide network every three weeks.
There are currently just ten IXPs in the MENA region, compare that with over 170 in Europe, 88 in North America and 82 in Asia-Pac according to PCH. There are eight cities with populations greater than three million people and 15 cities with populations greater than 1.5 million in the MENA region that do not have an internet exchange (that’s over 46 million people). London alone has three IXPs. The logical thing to do to help boost connectivity then is build more IXPs in MENA and over time that will happen. But there are a good reasons for the regional shortfall and inertia.
Critical infrastructure is patchy and in some parts non-existent. Data centres that host IXPs need 24/7 power which cannot be guaranteed in some parts of MENA, local fibre routes from landing stations to data centres need to be in place, national networks to serve end users also clearly need to be in place. In 13 MENA countries telecommunications are owned and managed by incumbents, this lack of commercial competition keeps prices high and penetration low. These technical and policy hurdles are not insurmountable, but they are holding back broadband connectivity.
A common investment challenge exists when it comes to building landing stations for submarine cables, data centres, IXPs and all the associated additional critical infrastructure necessary to raise broadband’s reach. It requires huge capital up front expenditure, which must be funded by ongoing revenue from end users. Without the revenue it can’t be built, without the connectivity there will be no revenue. To overcome this barrier requires a “build it and they will come” approach from national governments, since the model is simply too risky for most investors to consider. However, only 11 countries in MENA are adopting national broadband strategies to foster broadband access. But that number will surely rise over time as national governments witness the impact that broadband has on neighbouring economies.
Broadband penetration accelerates after the level of retail broadband price falls below 3–5 percent of average monthly income according to the International Telecommunications Union, and retail prices generally only come down with increased competition on the wholesale side. This hypothesis is backed up by figures from telecommunications market research and consulting firm Telegeography that show a decline in transport costs directly correlates to the addition of new cables in the area.
In its 2014 report titled Broadband Networks in the Middle East and North Africa, the World Bank states: “In the MENA region, fixed broadband price constitutes ~3.6 percent of the average monthly income per capita. While Djibouti, Syria, and the Republic of Yemen are significantly above the five percent threshold, a number of countries (i.e., Algeria, Egypt, Jordan, Libya, Morocco, and Tunisia) have just reached the level that makes rapid broadband takeoff possible.”
We are on the cusp of seeing the MENA region explode into the broadband world. According to Cisco from 2012 to 2017, internet traffic in the Middle East and Africa (excluding South Africa) is expected to grow at the highest rate when compared with other regions, a compound annual growth rate of 39 percent.
That growth will come about as a result of a complex series of geopolitical and economic factors. One of which will be connections made to mainland Europe via submarine cables landing in France. It would be overblown to suggest that these connections to Europe are the sole driver for broadband connectivity in MENA, but if international businesses want to connect with one of the fastest growing economies in the world, then Marseille would seem like the obvious gateway.