Study of Conditions for Replicating the Grameen Telecom ...
What can civil society do? Example: submarine connectivity for Bangladesh Rohan Samarajiva Association for Progressive Communication Seminar, 19 April 2006 Agenda Example of a policy intervention by an ICT policy-regulation research & capacity building (uncivil?) organization Do not focus only on the obvious, like More connections Lower prices
E.g., better access regime for submarine cable stronger competition better all-around sector performance Seize opportunities; leverage strengths www.lirneasia.net SEA-ME-WE 4, Bangladeshs 1st submarine cable; so close yet so far www.lirneasia.net Opportunity
Cable operational in December 2005 Bangladesh not ready With connecting links Access regime Opportunity accepted UNDP invitation to address ITES forum Hartal day but 250-person room full to capacity Minister & BTTB leadership present for entire session www.lirneasia.net SAT-3/WASC/SAFE: new connectivity for West Africa from 2002 www.lirneasia.net
SAT-3 in West Africa & SMW4 in Bangladesh compared 28,800 km Initial capacity 120 Gbps USD 670m cost Commissioned May
2002 15 countries; 17 landings 1st & only submarine cable for W. Africa www.lirneasia.net ~20,000 km Initial capacity 160 Gbps (12.5% of
design capacity) USD 500m cost Commissioning 13 Dec 2005 in Dubai 14 countries; 15 landings 1st & only submarine cable for Bdesh SAT-3/W Africa & SMW4/Bdesh Closed club consortium
Only circuit sales; now loosening up www.lirneasia.net Closed club consortium, with greater flexibility Full circuit sales allowed Only consortium can sell IRUs for 2 yrs; members may sell after 2007
W. Africa 02 = Bangladesh 05 www.lirneasia.net SAT-3: cable does not necessarily mean connectivity 2000 Internet traffic from Africa (Gbps) Annual increase www.lirneasia.net 0.649
2001 2002 2003 SAT-3 starts 1.230 2.102 3.226 90% 71% 53% What about capacity use?
IEEE author estimate = 3% at end 2003 Already beyond expectation Administrator of cable consortium However, he also says: In many of these countries . . . backhaul network is quite not accessible or may not be fully in place or may not have the capacity to support international access www.lirneasia.net Case study: Nigeria (Dec 2003)
Main cable station completed in December 2001 Started handling traffic in April 2003 (15 months later) 13 STM-1s (155 Mbps) available (3 in reserve) 78% of one STM-1 frame in use (connected to sole domestic fiber) by Shell Nigeria www.lirneasia.net Case study: Nigeria Socketworks (ITES firm) No fiber; no SAT-3 Uses satellite connection (64 kbps up/256 kbps down) to California server farm
USD 13,000 to install, including dish, modem, and router Operational costs = USD 1,000/mo. "The worst thing that happened to SAT-3/WASC was that the Nigerian people were represented by the most incompetent and most dysfunctional company in the world, NITEL Dr Aloy Chife, CEO, Socketworks www.lirneasia.net And price? In monopoly environments only circuits are sold Connectivity= circuit from, say, Europe +
circuit from African country Actual price can be many times the cost of international circuit In June 2005, E1 circuit from Europe was USD 6,000-8,500/mo. circuit from Telkom SA was USD 15,00017,500/mo. Total = USD 21,000-26,000/mo. (~70% to S African monopolist) www.lirneasia.net Price, Africa compared to India (ITES leader; regional benchmark) India, E1 full
Mumbai-NYC 8,614 www.lirneasia.net But India is not standing still . . . In 2004, India was in circuit regime VSNL took ~85% of revenue from Indian circuits But will move to full circuit regime with new capacity coming on stream Tata Indicom 5.12 Tbit cable between India &
Singapore in November 2004 SMW4 and FLAG Falcon in December 2005 TRAI has ordered cuts of 29% for E-1s, 64% for DS-3s, and 59% for STM-1s relative to IN-US Atlantic route effective September 2005 www.lirneasia.net New regulated prices in India Ceiling price/month for IPLC half circuits (USD), IN-US Atlantic Route [likely full circuit price, assuming identical circuit prices] E-1 DS-3 STM-1
www.lirneasia.net 2,366 [4,732] 18,928 [37,856] 54,418 [108,826] Recommendations to Government of Bangladesh Hive off the SMW4 consortium share & interface (including fiber to Coxs Bazaar) from BTTB now; make it a stand-alone company Design a management contract with strict performance incentives and bid it out transparently Contractually mandate management to webpublish all capacity contracts
Dont wait for three years and waste opportunities; do it now www.lirneasia.net Recommendations Declare the cable & associated facilities essential BTRC to be directed to implement open-access regime Leave satellites alone, like India Encourage the landing of an additional cable (possibly connecting India/Singapore) to
provide facilities based competition in future Cable redundancy needed in addition to satellite Also analysts expect downward pressure on IPLC prices in Pakistan and Sri Lanka where SMW4 will be 2nd cable (excluding obsolete SMW2) www.lirneasia.net Follow up Based on responses Confidential memo to Minister at his request Op-ed piece in Daily Star within 3-4 days Seized the opportunity using comparative advantages Research & media savvy
Now up to domestic actors to move process forward Actors not fully lined up because opportunity arose suddenly www.lirneasia.net Rohan Samarajiva www.lirneasia.net [email protected] +94 11 493 9992 (v) +94 11 494 0290 (f)
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