World Dialogue on Regulation

With the report 'Promoting Private Sector Investment and Innovation: To Address the Information and Communication Needs of the Poor in Sub Saharan Africa' infoDev and Alcatel dive into the private sector development of the ICT sector for rural development. InfoDev investigates the demand side of the ICT Services in Sub Saharan Africa (SSA), while Alcatel focuses in the operator supply side of the need of ICT services.

The conclusions of the study are drawn on the basis of five case studies selected from infoDev's archives. In order to be selected, the cases needed to satisfy the following criteria:

• The service offered should represent the fruits of market research conducted by the private sector in the countries themselves;
• The service should address unmet needs identified by the millennium development goals; and
• Where possible, the projects should be self sustainable.

This lead to the selection of the following cases: 

1. IKON in Mali, aiming at providing radiodiagnostic services to three main cities 
2. SIMpill in South Africa, aiming to help reminding Tuberculosis patients through the use of SMS to take their medication 
3. Pesinet in Senegal, designed to be an early-warning system warning to identify possible children-at-risk of child illness
4. Manobi in Senegal provides market information for farmers and fisherman with real time market information
5. MoPay is a mobiles banking system in South Africa uses SMS to provide financial services.

On the basis of the experiences in the case studies and interviews with the telecom service providers, six interrelated threads for a further expansion of ICT services to the Sub-Saharan Africa rural areas are identified: 

• The demand for information and communication services is high
• The demand for information will increase with decreased bandwidth costs
• The need for data-services is increasing
• Major regulatory, market and infrastructure impediments need to be addressed if ICT's are to become more pervasive in Africa
• Optimized Total cost of Ownership (TCO) allows operators and service providers to make profits in the rural areas
• Low-income users need customized solutions to meet their constraints and needs in terms of access to credit

The report gets to its most promising part when it tries to develop answers and guidelines (chapter 6 and beyond). What can we do if Telecom providers fail to roll out services in the rural areas, due to heavy investments needed and marginal revenues that are expected? The answers offered, however seem simple and high level. The reports proposes two answers: innovative financial models and reduction of the total cost of ownership (TCO). Providers of services and operators needs to move away from the traditional financial models into more innovative 'vendor/operator relationships' and search for innovative financing options.

The proposed solutions feel like a 'truism'. Maximizing TCO by cost reduction, developing tailored, cost-effective solutions and sharing the infrastructure can never be wrong. Also the illustrating business case presenting the scenario of the introduction of voice and data services through WiMax in the low urban and low density areas of Mali is convincing only from a financial point of view. The true complexity of the situation, like the harshness of the terrain in which the equipment needs to operate, the lack of educated people to do the maintenance and the possible services that can attract customers are left out of the equation. Resemblance with the debacle of many of Africa's telecentre initiatives creeps in.

In order to achieve a successful rollout of the information and communication services the report identifies some critical success factors:

• Increased market competition in the ICT sector
• Greater access to capital
• An educated labour pool
• Localization of content
• Enabling policy, legal and regulatory framework for ICT services
• Public-private partnerships

This list is interesting, but how do the factors influence each other and how do the factors rank in importance (if there is any)? A market and competition enabling policy, legal and regulatory framework is important as a foundation, but what if we do not have the universities to train people to develop and maintain the services? Fertile land alone is not enough to make the crops grow. This point gets even more important since the solutions discussed in the report are not mainstream off-the-shelf products. Further, if we do have well-trained people, are they willing to stay in the country and develop the sector? In the medical field in Africa we have seen that better training also creates better opportunities for the doctors abroad (the so-called brain drain).

Regulatory frameworks for the ICT sector should not be considered in isolation. They should be carefully researched and aligned with education policies, labour policies etc..

The approach followed by the report of analysing case studies and presenting possible scenarios is good. The examples and the scenarios may start a reflective process in other countries. For policy makers they can provide a point of reference for what is possible when formulating new policies and frameworks. This is highly needed since many of the policy makers needed to be educated about the possibilities that ICT's offer for the poor in SSA.

Get the full report from infoDev's website...

Get the French version of the report from infoDev's website...