 | Issue: | 2010 |
| Article no.: | 6 | |
| Topic: | Can wireless solve the African puzzle? | |
| Author: | Cosimo Malesci | |
| Title: | Vice President of Marketing | |
| Organisation: | Fluidmesh Networks | |
| PDF size: | 152KB |
About author
Cosimo Malesci is the Vice President of Marketing at Fluidmesh Networks, Inc. Mr Malesci co-founded Fluidmesh five years ago when he was 23 years old and a Master student at MIT. This new venture has allowed him to apply his understanding of engineering to the wireless world. Cosimo Malesci earned Bachelor and Master degrees in Ocean Engineering – both from the Massachusetts Institute of Technology.
Article abstract
Voice and broadband communications are essential for Africa’s economic and social growth, but building sustainable business models for mobile is still a challenge. Local regulations hamper wireless rollout and each country regulates spectrum differently. There is also little information and regarding local regulations. This is a showstopper for large investors because it increases investment risks. Technology is bringing affordable handsets and cutting the costs of network infrastructure, but to make wireless truly affordable governments need to cut taxes on service and consumer and network equipment.
Full Article
The African continent is a big challenge for the deployment of wireless networks for cellular or broadband connectivity. There is no master plan, but wireless networks are spreading independently at record speeds throughout Africa, providing better communications, more efficient business interaction and new job opportunities. Not surprisingly, easier communication is also improving the quality of life for Africa’s people offering access to better education, information about health and diseases, and a host of other vital services. A stable wireless network and reliable connectivity is essential for progress, but much remains to be done before this can happen. Africa is the world’s second largest continent after Asia. Its population of roughly one billion people also makes it the second most-populous continent. More than one thousand languages are spoken in its 53 countries. Africa is also the continent richest in natural resources; it has 90 per cent of the world’s cobalt, 90 per cent of its platinum, 50 per cent of its gold, and 98 per cent of its chromium. The Democratic Republic of Congo, by itself, has 70 per cent of the world’s columbite-tantalite – extensively used to manufacture the capacitors in most of today’s electronic devices. Africa is also the poorest and most underdeveloped continent in the world. Roughly 50 per cent of Africa is rural and has no access to electricity According to the World Bank in 2005, more than 80 per cent of the population of Sub-Saharan Africa lives with less than US$2.50 a day and about 50 per cent lives with less than US$1.25 a day. That means that there are close to 400 million people living in dire poverty and the economic situation in much of Africa s not improving. The poverty rate has actually gone slightly up in the last thirty years and the Sub-Saharan region has been the least successful in reducing poverty worldwide. What causes this disparity between resources and economic development? Deadly diseases such as HIV and malaria, corrupt governments with little or no central planning abilities, high levels of illiteracy, lack of access to foreign investment capital, and frequent tribal and military conflicts are just some of the issues that Africa faces daily. These same challenges – and others – are also faced when trying to create a sustainable business model to deploy the networks required to resolve Africa’s connectivity needs. Given the diversity of economic and political situations found throughout the continent, there is no single business model that will work in every region. Nevertheless, the combination of better spectrum regulation, more cost effective mobile devices, and more flexible and cost effective wireless backhaul solutions for both cellular and broadband services, is helping Africa make great progress connecting its people and improving their standard of living. Local regulations pose some of the biggest barriers to deploying an effective wireless infrastructure. Each African country has its own, often quite different, regulations for spectrum usage and this has become one of the greatest obstacles to the deployment of wireless infrastructure. The process is made even more complicated by the lack of information about local regulations, which makes this task even harder. Although this gray area in spectrum usage policies might present an opportunity for some, it is definitely a showstopper for most large cellular carriers because it strongly increases the risk of their investment and is a big problem for outside investors as well. Moreover, government instability, a common problem in many African countries, adds a substantial amount of risk to any investment. Deploying a cellular network is a long-term investment; it requires careful planning of revenues for a period of many years. Clear, easily accessible, regulations – together with a stable government – can play a major role in developing a sustainable network deployment. The lack of specific regulations about spectrum usage often leads to a second problem – bureaucracy. Timing is vital when deploying a wireless network. Spending months or even years getting approvals from the local regulator is a process that scares many potential investors away. When mixed with a far from glorious track record of government corruption, the end result is not hard to imagine. These problems stifle the development of mid and small size carriers that lack the capital and the political connections to make their business possible and usually limit network reach. The cost of the wireless infrastructure and potential return on investment (ROI) affects the interest of the carriers, so it plays a key role in the expansion of wireless in Africa. Limiting the cost of the hardware used for the cellular backhaul infrastructure can increase ROI. Current technology gives carriers an interesting alternative to reduce the cost of the backhaul infrastructure – sub-6.0 GHz backhaul solutions including IP-compatible 2.4, 4.9, and 5.1-5.8 GHz bridges based on OFDM technology. This technology is often used for the synchronization between cellular towers. When the budget is limited – fairly common in Africa – sub 6.0 GHz backhaul systems should be considered. Compared to a traditional microwave backhaul, a sub-6.0 GHz solution can be up to 80 per cent less expensive; its performances is stable regardless of the weather and it is quicker to deploy. Sub- 6.0 GHz solutions used to have limited throughput. However, with the recent introduction of MIMO technology, sub-6.0 GHz wireless can now provide up to 150 Mbps of sustainable bandwidth, making it viable for the latest high-bandwidth applications running on today’s cell phones. Moreover, since sub-6.0 GHz wireless backhaul systems use relatively little power, solar panels can supply the power. This makes sub-6.0 GHz even more suitable for rural deployments than traditional microwave bridges. If wireless is to be successful in Africa, the number of network subscribers needs to be large enough to justify the initial investment in infrastructure. Given the living conditions of many African people, this might seem a bit of a challenge. However, technology is once again coming to the rescue. Thanks to an effort by the ITU and manufacturers to reduce the cost of mobile phones to levels affordable in developing regions and the rising number of customers worldwide, the price of cell phones has dropped dramatically; they are now affordable by a great many customers in the poorest parts of the continent. In order for this model to work, however, governments need to reduce taxes on wireless consumer devices and, as well, facilitate the development of local business to service the cellular industry. Given the size of the African market and the record-breaking growth rate in cell phone usage, the demand for cell phone related services and applications will certainly grow and become a substantial source of revenue for many African countries. With good, reliable, low-cost communications, professional training to develop technical skills and its low cost of labour, Africa could also become an attractive option for companies in more developed countries to out-source some of their needs. Although cell phones are currently the leaders in wireless connectivity, wireless broadband access is also needed to improve lives and facilitate business. Due to cost and technical limitations, wireless broadband will not become as widespread as cellular phones for many years to come. Although deploying wireless broadband is similar to cellular, access and backhaul are generally more expensive to provide so a considerably higher number of subscribers per square miles is needed to guarantee a return on investment. The limited electrical infrastructure, the low population density and the size of the African continent make broadband connectivity economically feasible only in the most populated areas. In addition, although 3G and 4G smartphones can do a lot with wireless broadband, many broadband applications really require a laptop or a desktop – both substantially more expensive devices than smartphones – to be truly effective. The combination of these factors has slowed the expansion of broadband connectivity in Africa. The only viable way to speed up broadband rollout would be an organized and coordinated effort by governments in each country to allocate funds to subsidise broadband in economically marginal regions. That said, it seems that cell phone networks will lead the wireless revolution in Africa.
