Universal Access Strategy and Broadband Development

The concept of universal access to telecommunications must be extended from pure telephony to encompass broadband services. Technology adoption is recognized as a major contributing factor to development, and the economic and social differences in communities on each side of the ‘digital divide’ are pronounced. Access to broadband services is recognized as a driver of economic growth, promoting efficiency and overcoming geographic market restrictions.* World Bank statistics indicate that a ten per cent increase in penetration of selected ICTs may increase Gross Domestic Product growth per capita by up to 1.38 percentage points.* 

Beyond this, access to information and the ability to communicate opinions contribute to a country’s education and political systems. Public services such as remote health advice and disaster warning systems are improved through the construction of nationwide communication networks. As a result of these benefits, the World Bank and other international organizations are encouraging infrastructure development plans and governmental schemes to promote broadband use and accessibility in underserved areas.

The United Nations’ Millennium Development project aims to achieve affordable and reliable access to broadband services for all by ensuring that all countries will have a national broadband plan in place or include broadband access in their national service definitions by 2015.* Most countries have preferred the more proactive approach of implementing a national broadband plan.* The approach adopted by a government depends on whether it seeks to intervene to drive or facilitate development, or whether it prefers to rely on market forces to increase coverage. A national broadband plan should set out desired outcomes, rather than to specify the technologies sought to be implemented.

The government in St Kitts and Nevis has repeatedly stated its commitment to internet access and improved digital literacy for all citizens. As well as ushering in new telecommunications policies and harmonising its approach to ICT with those of its Caribbean neighbours in order to achieved increased uptake of internet technologies, St Kitts and Nevis has entered into PPP arrangements with telecoms providers LIME and The Cable in order for schools to be provided with free internet access ensuring that the next generation is proficient with the use of broadband technologies. Providers have also supported government policies to train citizens in how to use broadband technologies by providing the equipment and internet access to community centres to run internet usage courses to teach basic online skills to the wider community.

BOX 4.1
Case Study: Government approach to broadband in St Kitts and Nevis

For greater analysis on broadband developments in St Kitts and Nevis see the case study provided by infoDev at: /Custom/Core/Documents/kn.pdf

As demonstrated in Malaysia, licensees providing service to rural areas under the High Speed Broadband Network plan have been given permission to use TD-LTE services, rather than WiMAX, as initially planned. Ensuring that major network backbones are suitably positioned to support a variety of technologies will allow flexibility to adapt last mile services to the best solution available at the relevant time.

  • 4.2.1 Achieving Universal Access

    Universal access can be accomplished when either:

    • in response to demand for services, private entities decide independently to extend their network coverage;
    • regulatory measures are put in place to require private entities to extend their existing networks; or
    • governments fund infrastructure projects to increase network coverage.

    Governments can play a role in ensuring sufficient demand for paid broadband subscriptions by, if necessary, encouraging the use of the internet in a productive and enriching manner. A coherent and comprehensive national broadband plan is necessary to ensure that broadband development is successful across both steps and will create the intended benefits.

    The success of countries that have implemented holistic plans that incorporate both of these policy steps, including Korea, Japan and Canada, is testament to the efficacy of this approach.

    In each country unique hurdles will have to be overcome. Encouraging adoption of existing networks in the European Union, extension of service to isolated rural areas in Australia and subsidising access technology in Malaysia are good examples of tailored policy approaches to local conditions.

    The government of Sri Lanka acknowledged the growing information and opportunity divide between rich and poor and produced a roadmap to develop a more inclusive information society called e-Sri Lanka. Closing the information gap between rich and poor was achieved by a blended policy and regulatory approach of encouraging greater competition by the awarding of additional sector licences, coupled with early licencing of 3G spectrum. The presence of 4 telecommunications operators forced the telcos to move away from skimming profits from servicing only the rich and middle class consumers of Sri Lanka to a model which profits from high volumes of users who only spend a small amount of pre-paid disposable income on internet and data services, thus increasing universal access amongst poorer Sri Lankans.

    BOX 4.2
    Case Study: Sri Lanka - Overcoming socio-economic factors to stimulate broadband uptake

    For greater analysis on broadband developments in Sri Lanka see the case study provided by infoDev at: /Custom/Core/Documents/lk.pdf

    FIGURE 4.1
    Average annual increase in internet users per 100 people across income groups

    Source: International Telecommunications Union, ICT Statistics. Available at: http://www.itu.int/net4/itu-d/icteye/

    • Service Quality

      The purpose behind implementing a universal access plan must be reflected in the bit rate provided under the relevant broadband development scheme. Many of the functions that universal access seeks to provide, including telemedicine and tele-learning, require access at up to 100 Mbps, while standard applications such as email and web browsing can function speeds as low as 0.5 Mbps.High broadband upload rates facilitate a collaborative online environment by encouraging user contribution, while high download rates enhance the accessibility of content. High bit transfer rates enable interactive functions such as real time feedback and video calling.

      It is advisable that access to ‘high-speed broadband’ be specified in universal access models. Even where the headline rate is sufficient, frequently consumer experience of a broadband connection will be substantially less. Other factors, including throughput and latency must also be taken into account. For instance, the Ethernet port of an ADSL modem will report connectivity at its particular line rate while the actual connection rate is determined by the distance from the DSL access multiplexer in the exchange building and the quality of the copper lines. Similarly, a wireless connection rate will depend on the use of others on the same access network and the backhaul capacity from the relevant base station to the core network.

      In some instances there is an additional issue of service providers submitting false compliance reports on the quality of broadband services they offer. In India, the telecommunications regulator has addressed this by imposing fines on providers found to have made such statements.* In South Korea, all buildings are to be designed to enable high-speed connections, and assigned ratings to communicate to potential residents the bit rate supported.* 

      Government spectrum allocation decisions impact wireless service quality, while fixed line services can be improved by upgrading the network quality and ensuring customers have access to sufficiently advanced modem technology.

      Countries at times adopt different target bit rates based on the forecasted use in different areas. This may particularly be the case where governments are required to fund or subsidize infrastructure or subscription costs. In Australia, the National Broadband Network that is currently under construction plans to provide broadband access at bit rates of up to 100 Mbps. Conversely, in the European Union the required base rate is to be 30 Mbps, although the Digital Agenda aims to encourage 50 per cent of subscribers to pay for access at over 100 Mbps. In Malaysia broadband and universal service policies are separate, and levels of access are terraced by region. Under the HSBB service, households under the designated high economic impact areas receive minimum of 10 Mbps, while businesses in these areas will receive up to 1000 Mbps.

  • 4.2.2 Levels of Access

    The levels of access provided under a universal broadband access scheme may be assessed according to the proportion of the population that are able to access the internet and the locations from where access is achieved. Establishing individual fixed broadband connections for all households and businesses may not be a viable option in all areas due to the associated costs, lack of demand and geographical constraints. At times, governments must assess the underlying goals of their universal access strategy and prioritise the most cost effective means to achieve those. The extent to which existing systems can be upgraded as opposed to new systems having to be built, will likely inform outcomes. Part discusses the benefits of establishing broadband connections to individual users and households, while Part 4.2.3 explores additional approaches to facilitating communal and institutional access.

    • Individual Users and Households

      Connecting individual users and households to a broadband network represents optimal service penetration. Household connections overcome restrictions to access in other settings such as age, employment situation or educational background.* Broadband usage by households has increased as access costs become more affordable and service coverage extends.* Household internet access in developed countries has consistently been higher than in the developing world.* In 2011, 70.3 per cent of households in developed countries had internet access, compared with 20.5 per cent of developing countries.* The Broadband Commission for Digital Development (Broadband Commission), a joint initiative of the International Telecommunication Union (ITU) and the United Nations Educational, Scientific and Cultural Organization (UNESCO), targets 40 per cent of houses in developing countries to have internet access by 2015.* Studies in the United States found that home broadband users overwhelmingly valued the social aspects of internet use, citing the ease of communicating with family and friends and content sharing applications as the most important functions.* Access to information, news and entertainment are also important, as is the ability to engage in e-commerce through shopping and selling goods online. The educational value of home internet access is frequently highlighted, as research has shown that children with internet access at home perform better in school.In many countries, the extension of direct fixed line service networks to individual homes is included in universal access targets. Governments have adopted a variety of strategies in order to attain such connections.

      Regulatory tools may be used to increase market entry and competition, while minimising the input governments are required to contribute. Models which have separate sources of supply at each “layer” tend to promote competition more effectively than vertically integrated supply. This drives policies which seek structural or functional separation between the elements of the network on the grounds that a vertically integrated approach may inhibit investment by competitors and new entrants. In Singapore this strategy was initially adopted, however it proved insufficient to extend coverage to a satisfactory level within the time limit this was required. In Finland, a regulatory approach was also adopted when the Finnish Communications Regulator required 26 designated telecommunications operators to provide connectivity of at least 1 Mbps for all consumers and businesses at their permanent place of residence.

      Finland is part of a growing global trend that identifies the communications and educational opportunities afforded by broadband as so basic a foundation for adequate functioning in modern society and accessing opportunities that it has become a fundamental right of all human beings that governments must protect. Spain has taken a similar approach to the rollout of basic broadband speeds and there is strong political support in Estonia that broadband is essential for modern society, which led to a massive investment in Estonia of broadband facilities in rural areas.

      Legal challenges have also confirmed that broadband access is gaining recognition as a basic human right. A 2010 Supreme Court ruling in Costa Rica confirmed that internet access is so essential to modern day communication and expression and was a tool to access other rights such as participation in society and self-government that the Court held that internet access itself was a human right. Similarly, in France the Constitutional Court delivered a judgment striking down a French law which proposed to cut internet access to people who were considered to be guilty of illegally downloading content. The French court argued that broadband was essential to access information and give free expression to ideas and political dialogue. Although Finland is one of the forerunners of this rights based regulatory approach, it is likely many other sttes will follow suit.

      Regulatory intervention may not be appropriate in all circumstances. In the United States attempts to regulate the telecommunications market have been met with protracted litigation from incumbent local exchange carriers.* When constructing the National Broadband Plan in 2010, the United States Federal Communications Commission specifically referred to the possibility State governments might intervene to provide infrastructure and broadband services to individual premises in areas where private enterprises do not. This approach was more palatable than imposing regulations requiring extension of coverage into non-profitable regions, while still working towards the universal access goal of connecting 100 million Americans to broadband services.

      BOX 4.3
      Case Study: Extending broadband networks through regulation

      Investment in network infrastructure reduces the initial capital investment for market entrants, encouraging pricing competition, and also extends coverage to areas where this may not otherwise have been commercially viable. In Australia the government-funded National Broadband Network Company will construct a high-speed wholesale broadband network that serves every home through a combination of fibre, fixed wireless and satellite services. Although this is a far more substantial task than only providing connections in areas where they are not currently available, this model allows the higher costs of rural rollout to be offset against the lower costs of connections in urban areas.

      In Canada the government has also funded infrastructure development, but restricts this to areas where private coverage is not sufficient. In 2009 a $225 million (US$217 million) subsidy was allocated to extend access to around 3 million people who did not have access to broadband services, including the high-profile projects to provide satellites to the remote Far North Nunavut and Northern Territories. A major benefit of the single wholesale provider model is that in addition to regulating price, a single national infrastructure may also ensure that sufficient backbone services and long haul data transmission are provided.

      BOX 4.4
      Case Study: Infrastructure development to extend broadband networks
    • Demand Creation

      It is particularly important in countries which extend networks to individual and households that customers exhibit sufficient demand for broadband services. In situations where broadband networks grow organically without regulatory intervention, broadband take-up and coverage figures should follow a similar trajectory, as providers will improve upon the service they offer in order to meet demand. Where universal service capacity is achieved through government encouragement, individual users must take up paid subscriptions with service providers in order for models to remain sustainable. A United States Federal Communications Commission Report on home broadband use cited cost, lack of digital literacy and a feeling access was irrelevant to a person’s life as reasons for not taking up available broadband services available.* Cost is addressed below in Part, while this section will explore examples of the measures adopted by governments to increase the relevance of broadband services to people’s lives and improve digital literacy.

      There is a direct correlation between high household broadband use and areas in which a holistic universal service strategy has been implemented.* While a recent OECD report has suggested that governments need to play more than a ‘push’ role of providing ICT infrastructure and development of a domestic ICT sector,* it is also important that they adopt ‘pull’ strategies aimed at promoting digital literacy, establishing an appropriate legal framework surrounding internet use and fostering the development of local content.

      The European Union’s Digital Agenda provides a good example of a ‘pull’ strategy focused on facilitating certain uses of a broadband connection. By 2011 the whole of Europe had achieved universal broadband coverage by satellite and around 95 per cent coverage by fixed line. However, this coverage did not translate automatically into broadband subscriptions.

      The European Commission’s Digital Agenda Scoreboard demonstrates that the percentage of households with a broadband connection has increased dramatically from 14.9 per cent in 2004 to 67.3 per cent in 2011. The Digital Agenda aims to increase take up of broadband subscriptions and to encourage particular uses of broadband services supported by a secure high-speed connection. Targets include 50 per cent of the population buying products online and 50 per cent of the population using e-Government. In pursuance of its goals, digital ‘to-do’ lists are published annually, detailing the measures required to encourage adoption of these new use habits.

      In addition, digital education is encouraged in order to enable EU citizens to take full advantage of the benefits of broadband, with the aim of reducing the population that have never used the internet before to 15 per cent. The success of the policy can be seen in OECD statistics that suggest the European Union has some of the highest household broadband access rates in the developed world.*

      BOX 4.5
      Case Study: 'Pull' strategies in the European Union and South Korea

      A similar project was undertaken in South Korea. The Korean government’s broadband strategy envisioned a ‘knowledge-based economy’ in which every citizen would have access to a personal computer and government would expedite development of an information infrastructure. Several initiatives were put in place, including regulatory efforts to encourage infrastructure investment by incumbents and market entrants, subsidies for low income citizens to purchase computers, and free digital literacy programs encouraging internet use as a means of obtaining information, providing entertainment, and accessing government services. South Korea further stimulated demand by targeting much of this training to homemakers, who are typically married women not in the workforce but who have a large amount of discretion in the organisation of household finances. The theory was that by convincing homemakers of the benefits of broadband, demand would be stimulated for household uptake and ensure the next generation of South Koreans would have access to broadband as their parents accessed such services. The targeted training was a successful approach to driving broadband uptake as the proportion of South Korean women who utilise broadband is much higher than their counterparts in Singapore, China, Taiwan and the rest of the region.* In this way, top down and bottom up approaches were combined so that incentives to improve service to citizens would be met by increased demand for services. South Korea now leads the developing world in household internet connections. By June 2011, 97.2 per cent of households in South Korea were connected to the internet.

      Other governments have implemented regulation to directly create demand:

      • In Japan it was mandated that all administrative agencies must buy their broadband services from the Next Generation National Broadband Network;
      • In Sweden, companies that purchase PCs for their employees receive subsidies and household that install broadband can receive tax deductions for the costs of installation up to approximately US$650. Computer ownership and the cost of hardware and software upgrades have been found to be a factor contributing to lower broadband uptake;* 
      • In Denmark broadband can be offered to employees as a tax-free fringe benefit which was a tailored demand creation mechanisms which took into account the relatively high income tax rates in Denmark and found that providing broadband as a form of employment benefit would be more effective at stimulating uptake;* and
      • In Bahrain, the government has a policy of encouraging the use of the internet to deliver government services and involve citizens in decision-making. Over 200 services are offered online, including payment of utility bills and traffic fines, tourist visa applications, driver’s licence renewals and student exam result delivery.
      FIGURE 4.2
      Internet users per 100 people in countries with population over 50 million 2005-2011

      Source: ITU, Statistics. Available at: http://www.itu.int/en/ITU-D/Statistics/Pages/stat/default.aspx


      Explanatory Note: Weight of lines demonstrates relative wealth of the country. Solid lines are high income, large dashes are upper middle income, smaller dashes are lower middle income, and dots are low income countries. The internet usage includes both mobile and fixed sources.

    • Mobile Access

      While household access is simpler to measure, individual access figures incorporating the access of individual household members may be a more relevant developmental indicator. Many governments include mobile broadband penetration in assessments of whether universal service is available.* Individuals with mobile subscriptions may not have access to a household connection, yet still have access to broadband services. In many areas across all stages of development, mobile broadband subscriptions have overtaken fixed line ones. By the end of 2011, the United Nations estimated that 45 per cent of the world’s population was covered by a high-speed (3G) mobile broadband service.* 

      Mobile technology can overcome major infrastructure barriers to internet access, and access devices are cheaper and more portable than computers. However, capacity, quality and data transfer rate can remain problematic. The expansion of mobile broadband subscriptions needs to be coupled with adequate investment in robust backbone networks, as well as a careful spectrum allocation plan. The broadband capabilities of mobile devices should also be examined. Some functions, like reading and constructing long documents, may be sufficiently necessary to achieving universal access goals to warrant computer broadband connection being included in a country’s definition of universal access.

    • Smartphone Adoption

      Continued growth in smartphone adoption poses a challenge to extending universal broadband access and use as a number of previous studies have shown that an increase in the number of smartphones leads to a decrease in fixed telecommunications lines.* The relatively recent advent of smartphones which utilise 3G broadband technology poses the question as to whether a similar substitutability of access methods will occur, leading to a decrease in fixed connections. Put another way, the question is will consumers choose to access broadband simply from 3G smartphones rather than from computer broadband connections? There is a paucity of hard evidence as to whether this is the case although some industry analysts have predicted that smartphones will come to be utilised in a complimentary way to computer-based broadband connections.* Arguably there is still a need for fixed broadband that is not met by 3G broadband, particularly for increasingly popular content services and business functions which still remain challenging to access on smartphone technology. Fixed broadband connected to adequate backhaul networks is better able to cope with large volumes of data traffic which is a challenge for mobile technology and fixed access is better able to service business clients with increasingly complex applications to run.


      Mobile broadband subscriptions per 100 inhabitants (2011)

      Fixed-line broadband subscriptions per 100 inhabitants (2011)







      The Americas



      Arab States



      Asia & Pacific






      TABLE 4.1
      Fixed and mobile broadband subscription per capita by region

      Source: ITU Statistics. Available at: http://www.itu.int/ITU-D/ict/statistics/

  • 4.2.3 Communal and Institutional Access

    Universal access to broadband does not require direct service to individual premises. In some national broadband strategies access in businesses, educational and government premises is prioritised. This may be due to prohibitively high costs of internet-enabled devices, paying subscription fees and financing last mile connections. In addition, while many national broadband schemes may be subsidised or supported by governments, ultimately the aim is to create systems that support themselves through charging for use. If individual subscribers are unable or unwilling to pay for broadband, institutional or community provision may be a more appropriate solution, at least in the interim while demand for individual fixed lines is being promoted.

    Community centres and institutional access may also help to supplement mobile phone use of broadband services in situations where a larger computer is required. For example, basic searching and email may be carried out by mobile phone, whereas creating complicated documents requires a larger device such as a tablet, laptop or desktop.

    • Community Access Centres

      Community access centres allow individuals to access internet services either free of charge or at an appropriate rate. The size and frequency of these centres can be adjusted according to the requirements of individual communities. Computer education programs can be run from the same centres, teaching people to draw optimal benefit from their internet access and creating demand for broadband connections in homes. Demand can later be met by the expansion of national broadband networks to homes or through private financing of last mile connections from the access centre node.

      In Malaysia, in addition to the national broadband rollout scheme, universal access has been brought to rural areas by creating 3100 ‘wireless villages’ and 796 ‘telecenters’. Wireless villages have at least three Wi-Fi spots in them to deliver data at 2 – 4 Mbps, and operate in conjunction with a system of distributing 1 million netbooks to poor students. Telecenters each contain 5 – 20 personal computers for community use. Similarly in India the Universal Service Obligation Fund provides kiosks connected to rural fixed line broadband exchanges. Kiosk workstations provide internet browsing and other broadband applications, such as video calling, access to online education and health services at subsidised rates. The benefit of this strategy is that any interested community member may become involved.

      There are some difficulties associated with community access centres that need to be overcome. In South Africa theft of computer equipment has been a problem, while in the Dominican Republic the national telecommunications operator INDOTEL provided the technical infrastructure to run community access centres but did not remain involved to ensure that centres were well-managed. Measures should be taken to ensure that access centre assets are adequately protected and that centres are maintained. However, in theory the community access approach strikes an attractive balance between universal access and cost-reduction.

      BOX 4.6
      Case Study: Community Access Centres
    • Institutional Access

      Some countries prioritise access in educational and governmental institutions. Broadband services open access to a large network of sources of information, including multimedia sources and online tutorials. These are seen to smooth out inherent disadvantages of some learning environments by allowing learners access to the same resources and ‘teachers’ from anywhere with a broadband connection.* Institutional access may also be material in increasing content available in certain languages, a factor which has been recognised as important to stimulating demand for broadband services.* 

      Strategies prioritising institutional access vary. In the United States the National Broadband Plan provides anchor institutions, including schools, hospitals and government buildings at rates of at least 1 Gbps compared to 100 Mbps for home access. By contrast in Canada the only publically funded broadband network is the CANARIE network, which connects research, industry and educational bodies through long-haul fibre optic cables, with last mile connections provided by users. The network can operate at bit rates as high at 100 Gbps, allowing the transmission of large amounts of data with an ease and swiftness unavailable to virtually any other internet users. Both the United States and Canadian models operate to give superior service to certain institutions on the basis that other users will still have access to broadband services.

      BOX 4.7
      Case Study: Institutional Access
  • 4.2.4 Universal Broadband Targets within the Broadband Strategy

    National broadband strategies should aim to facilitate universal access and target areas in which additional support is required to achieve this. Certain groups may face further barriers to access that cannot be addressed through a singular national policy. Inherent inequalities in position may be reduced, among other things, by funding infrastructure in less-populated areas and providing computer equipment to certain groups. In addition, strategies to improve access affordability may be included in universal broadband targets.

    • Regional Access

      In regional areas some form of external involvement is frequently required to ensure that adequate service is provided. The high costs of establishing a network and small pool of potential subscribers make expansion into these regions an unattractive business prospect. However, once network infrastructure is established, service providers need only pay maintenance and operational costs. This substantially reduces the investment required from service providers to enter new markets.

      In regional areas the costs associated with rolling out and maintaining a network will differ according to the technology used. Policymakers should consider factors like the expected life span of technology deployed and potential for that technology to be upgraded or progressively replaced as technology developments and demand for broadband increases. The relative location of broadband connections to access nodes and the major network backbone should play a pivotal role in the choice of telecommunications infrastructure deployed, as this will significantly affect the quality of broadband access.

      A government scheme was established to extend high-speed broadband access into some remote mountain regions of Chile. Public and private investments of nearly US$110 million funded a combination or fibre and wireless network to provide broadband access at data transfer rates and prices similar to those available in larger cities. The goal of this project was to remove the disadvantage of distance from economic centres and encourage competition and efficiency across Chile.

      The benefitted localities were selected on the basis of their involvement with other national developmental goals, including agriculture and tourism. These selections reflect the Chilean Information Society Universal Access Policy, which seeks to enable rural communities with productive potential to participate more effectively in the economy. Although this particular project did not benefit all rural communities, its purpose was linked to the wider policy goal of ensuring increased broadband use contributed towards a more cohesive and efficient Chilean economy.

      BOX 4.8
      Case Study: Regional Access in Chile
    • Broadband Pricing

      Service availability is the primary concern for achieving universal broadband access, but cost is also relevant. Pricing may also impact the rate of household internet use, which is frequently prioritised below business and institutional access. Studies of dial-up users on lower incomes found that cost was a major factor influencing the decision not to switch to broadband and that increasing household income led to increased demand for broadband technologies.* In developing countries, broadband access costs can account for 60 – 80 per cent of the total costs of owning a computer.By contrast, the United Nations estimates that entry-level broadband services in developing countries should cost less than five per cent of the average monthly income in order to be considered affordable and to drive uptake.* There has been some progress towards meeting this target, as access prices have fallen in over 120 countries in 2008-2009 and policymakers in developing countries have signalled their intent to make affordable pricing a key policy issue in order to drive broadband uptake.* Once universal service is established, it is more likely service provider competition and related pricing and service levels will gain prominence in access debates.

      The Broadband Commission has suggested substituting a prepaid package system for a monthly quota system.* This approach has been adopted by the Intel World Ahead Program.* Inspired by the success of prepaid mobile telephones in developing countries, the Intel World Ahead Program provides PCs and prepaid data download packages at low rates. For example, in Vietnam Intel has partnered with the major telcos Viettel and VNPT to provide 700 MB of data prepaid for $2. This result has increased the percentage of citizens who can afford broadband access from 12 to 70 per cent.

      In Brazil the approach has been to institute an affordable fixed line access cap of BRL$35 (around US$20) per month. It is hoped that this will enable fixed line service providers to compete with the popular 3G mobile services, which are comparatively slow and expensive.

      BOX 4.9
      Case Study: Broadband Pricing Strategies

      For a more extensive analysis, the broadband toolkit chapter on Brazil is available at: /Case/br

      Retail broadband prices in Kenya initially dropped following an 80% reduction in wholesale pricing. For example, a monthly E1 link charge fell from US$ 7,5000 to US$ 1,290 in 2007 and retail prices followed suit, with Telekom Kenya’s 256Kbps DSL monthly service falling from KES 16,008 to KES 2,999 (US$ 182 to US$34). However, there has been a lack of further price reductions, with operators preferring instead to compete on broadband speeds and additional features.

      Mobile internet services are popular in Kenya as operators have developed pre-paid data products which cater to the lower socio-economic end of the market. For example Safaricom offers as little as 5 MB a month for KES 5 (US$0.07) per day.

      BOX 4.10
      Case Study: Broadband Princing in Kenya

      For a more extensive analysis, the ICT toolkit chapter on Kenya is available at: /Case/ke/

    • Device Distribution

      Depending on levels of computer and internet penetration in a country, a computer-distribution program may either reduce disadvantages to certain groups where a large part of the population has access, or to provide an advantage to students where the general population does not have access. The ‘Home Access’ scheme, introduced in the United Kingdom in 2010, gave 270,000 low-income families a free computer and broadband access for one year.

      As part of its objective to transform Rwanda into a knowledge-based society, the universal service fund which has been in operation since 2004 is being used to provide a One Laptop Per Child program in Rwanda’s primary schools coupled with internet access in educational institutions. As of 2012, the initiative has provided over 200,000 laptops for children currently in the educational system and also aims to provide training to teachers on how to prepare classes in digital format and troubleshoot software and hardware problems with the laptops. However, there are over 2.5 million children in the educational system and the program has only delivered 200,000 laptops in the 4 years it has been in existence and has to contend with an educational system where most of the schools are not linked up to the national electricity grid.

      BOX 4.11
      Case Study: One laptop per Child in Rwanda

      Source: GSMA, Universal Service Fund Study, April 2013. Available at: http://www.gsma.com/publicpolicy/wp-content/uploads/2013/04/GSMA-USF-Main-report-final.pdf and Gitura Mwaura, ‘What Kenya could learn from Rwanda on One Laptop per Child’, New Times, 18 April 2013. Available at: http://www.newtimes.co.rw/news/index.php?i=15331&a=66047 

      Armenia’s attempt to boost digital literacy resulted in the Computer for All Program a public-private partnership with the Enterprise Incubator Foundation and Hewlett Packard, which aimed to ensure access to new computers and lap for all citizens via a reduced pricing model and financing and subsidisation schemes. The program objectives stipulate that 10,000 computers should be distributed each year utilising government lines of credit to end users. The project has a budget of US$3.5 million and also aims to provide technical support and broad training programs to the population on how to use computer systems.

      BOX 4.12
      Case Study: Armenia's Computer for All Program