Broadband; key to rapid GDP growth – Johnson, Juwah
On May 9, 2012 · In Technology

By Prince Osuagwu

Considering that voice telephony has just become a basic service in many countries of the world today, while data transmission defines for them the speed which businesses are conducted in the new world order, Accenture, gathered technology experts and other industry stakeholders last week, in Lagos, to brainstorm on possible ways of promoting and sustaining broadband availability in Nigeria.

Johnson, Juwah on broadband Interestingly, Minister of Communications Technology, Mrs Omobola Johnson chaired the parley while the Executive Vice Chairman of NCC, Dr Eugene Juwah also made a powerful presentation on the way forward.

The event seemed to have revolved around these two, considering that the institutions they head are key to the success or otherwise of the country’s broadband penetration efforts. While the ministry is expected to formulate and implement right policies to ensure growth, NCC is expected to sustain growth through focused regulation.

In her opening address, Mrs Johnson noted that on weekly basis, every event that holds in Nigeria, must have one segment or the other, where broadband access is discussed. For her, that is a strong point to begin to take the issue more seriously than before. This is more so, as she observed that some countries of the world have gone as far as defining access to broadband as a fundamental human right, just as access to water, electricity and healthcare.

Broadband for wealth
From every indication Johnson believes that for developing countries, declaring broadband a fundermental human right is the way to go. She said: “There are compelling and empirical statistics that tell us that every 10 percent increase in access to broadband in developing countries, results in a commensurate 1.38 percent increase in GDP. Therefore any country seeking growth, job and wealth creation, must address their minds to how it can increase access to broadband.”

However, there seems to be a sore point in Nigeria’s position to all these advantages that broadband access can bring about. This also seems to be giving the minister some sort of migraine. Her voice while highlighting the point, betrayed an urgent willingness to turn things around before her country plays the catch-up, forever.

“Despite the fact that we have internet penetration of about 28 percent which translates to about 45 million internet users, only nine per cent which is about 14.5 million people of the population are actually internet subscribers and broadband penetration is at a mere six percent.

“Although access through mobile broadband increases tremendously, that statistics only tell us that most Nigerians still access through public venues like cyber cafes and computer labs. This is not only for lack of broadband ubiquity but also the cost of access. Today, we have one of the highest costs of access in the world at approximately N8,000 to N10.000 for 5Mbs of data. This is even when the average speed of access is still low and in fact lowest in Africa,” she lamented.

Juwah and Johnson

She however, highlighted on some policy directions and interventions her ministry was looking at, to turn the tide around. These included declaring broadband as critical ICT infrastructure, as a catalyst for economic growth, as a means for inclusive social development and as a means to achieve effective government and governance.

According to her success in these declarations, would ensure achievement, in 5 years, of one national network capable of delivering broadband speeds of not less than 50 percent of average speeds available worldwide. It will also ensure increase in ICT contribution to GDP by at least 1.5 percent by 2015, ensure the use of broadband as a driver of inclusive development especially in the health and education sectors and also ensure that government services are delivered through the internet, among others.

Facilitatiing broadband growth through regulation
However, when the NCC boss mounted the rostrum, he delivered his speech with confidence that indicates that all hope is not lost. “Let me start by refreshing our memories when we say that we have conquered voice telephony. Currently, more than 90 million active lines are available for the population compared to about 400,000 some ten years ago. This is why the growth of the last ten years has been variously described as a revolution.

“By the International Telecommunications Union standards, this is a huge performance at 64.98 % teledensity compared to some 0.44% in 2001. This is why Nigeria is adjudged one of the fastest growing telecommunications nations of the world, and indeed, the fastest in Africa”.

Before participants could adjust and digest these facts, Juwah has taken to global aspirations for broadband and concluded that much as Nigeria needed this upgrade so desperately, it was not alone in the aspirations.

“It is not only Nigeria, or the developing world that aspires to enjoy the broadband revolution. President Barack Obama, on June 28, 2010, sent a memo to the Heads of the Executive Departments and Agencies in his administration titled: “Unleashing the Wireless Broadband Revolution.” One paragraph in that memo that has captured the thoughts of some of us who are dedicated to pursuing the broadband revolution reads:

“Expanded wireless broadband access will trigger the creation of innovative new businesses, provide cost-effective connections in rural areas, increase productivity, improve public safety, and allow for the development of mobile telemedicine, telework, distance learning, and other new applications that will transform Americans’ lives. The statement above represents the veritable offerings available in any country that has pervasive broadband availability”.

Economic impact
On the economic impact of broadband, Juwah made a quick calculation based on the World Bank position that in low and middle-income countries, every 10 per cent increase in broadband penetration accelerate economic growth by 1.38 percentage points.

“In an alternative perspective, doubling the broadband speed for the economy increases its GDP by 0.3 percentage points. The above percentage points may appear small but if you apply them to the Nigerian GDP at 40 trillion Naira you obtain an increase of more than half a trillion naira in the first instance and N120 billion in the second.”

However, Juwah knew that all was not rosy and so highlighted some impediments that could slow the pace of progress. “While the regulatory environment in the country has remained stable and attractive to the global investment community, there still remain a number of challenges. One of the most difficult challenges to wide scale broadband infrastructure deployment is the issue of right of way. While this issue seems intractable, there are obvious solutions.

State Government could move away from the current practice of imposing one off charge for right of way, based on distance to a new regime of periodic revenue streams from their right of way assets.

One way to realize these stream is to contribute the assets as participation in the project. Alternatively, State government may choose to barter their right of way assets for a specialized service from infrastructure operator. For example, access to right of way can be traded for a security surveillance network provided from the infrastructure.

Another challenge comes from Government institutions themselves in form of multiple regulation and multiple taxation. A third challenge is vandalisation of infrastructure” he added.

At the end of the Accenture broadband forum,  participants agreed that not only that the theme was apt but also the forum was necessary to wake Nigeria up to the need to join other countries of the world that hopes to use broadband access to accelerate economic growth.

Recently, the UK announced a 362m Pounds fund to improve broadband connections in 90 percent of hard-to-reach communities not catered for by the private sector. Also, the US congress recently awarded $2-5b in Recovery Act funding to help bring broadband services through fibre to rural unserved and under-served communities.

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