Advancing the Development of Backbone Networks in Sub-Saharan Africa

E xpanding access to advanced information and communication technology (ICT) services will be a key factor in sub-Saharan Africa’s economic and social development. Cross-country data show that ICT investment fosters higher long-term economic growth (Roller and Waverman 2001). Small businesses with access to mobile phones can generate sustained increases in the incomes of poor people in developing countries (Jensen 2007). The impact of broadband is harder to quantify because less data are available,1 but emerging evidence suggests that access to advanced ICT services—such as those that require broadband for delivery—can also have positive economic and social effects (Goyal 2008). As understanding of the benefits of ICT has grown, African governments have begun to give priority to it and to focus on providing affordable ICT services to as many people as possible. For example, in the introduction to Rwanda’s 2006 ICT strategy, President Paul Kagame wrote: “We have high expectations of ICT and its transformative effects in all areas of the economy and society. Communications technology has fundamentally changed the way people live, work, and interact socially, and we in Rwanda have no intention of being left behind or standing still as the rest of the globe moves forward at an ever increasing pace” (Government of Rwanda 2006, foreword). In response to the dramatic success of policy reforms in expanding access to mobile phone services in sub-Saharan Africa, policy makers and investors are exploring more advanced ICT services (Balancing Act 2007; Global Insight 2007; Telegeography 2008). Indeed, many policy makers in the region consider access to broadband a key driver of economic and social development. Yet broadband connectivity remains lower than in other parts of the world, and prices are high. For example, a basic DSL (digital subscriber line) package costs an average of $366 a month in sub-Saharan Africa,2 compared with $6–$44 in India (ITU 2007; OECD 2006).3 The average price of entry-level broadband in the OECD is $22 per month.4 The limited availability of low-cost backbone network capacity is one of the factors constraining sub-Saharan Africa’s development of broadband connectivity. Backbone networks are the high-capacity links that carry communications traffic between fixed points in the networks and form a crucial component in the communications supply chain. This chapter explains why backbone networks are important for delivering broadband connectivity and describes the current pattern of backbone infrastructure development in sub-Saharan Africa and the market dynamics underlying it. This analysis provides the basis for the policy recommendations outlined at the end of the chapter. The potential benefits of broadband are analyzed in chapter 3 and so are not discussed here. Chapter 4