The announcement today of the formation of the Alliance for Affordable Internet (A4AI) is the latest confirmation that the world has finally realised the crucial importance of connectivity in developing nations.
The initiative, launched by public and private sector players, calls for open, competitive and innovative broadband markets, with the need to bring down costs stressed as vital.
This follows the launch of internet.org, championed primarily by Facebook, which aims to provide internet access to five billion people. Facebook says that an increase in internet adoption of less than 9 per cent per year is concerning, and thus is looking to tackle the problem, mainly by focusing on bringing down data costs.
Google has also joined the crusade, joining the A4AI as well as launching Project Loon, which hopes to provide internet to underserved parts of the world through the launch of thousands of balloons to the edge of space. The company is also set to invest in wireless connectivity in Sub-Saharan Africa and has been engaged in discussions with regulators in Kenya and South Africa.
We must be clear that from the point of view of Facebook and Google, this is not charity but business. With Africa having the lowest penetration of mobile and internet globally, but also the fastest growth, the continent and other developing regions are the only places on Earth where the likes of Google and Facebook can still expect to grow their user bases and revenues, and they are making their move now to make sure that happens.
Regardless of their motives, however, the focus of multinational corporations on rolling out connectivity across Africa and the rest of the developing world can only be good for the countries involved.
A World Bank study has estimated a 10 per cent increase in broadband connectivity leads to 1.38 per cent increase in GDP. In 2011, McKinsey reported that internet-related consumption and expenditure had overtaken agriculture and energy, while a study released this year by the Technology & Social Change Group at the University of Washington Information School found that community access to ICT was crucial for connecting people to the information and skills necessary in a digital world.
Central to the question of connectivity in developing countries is cost, though infrastructure and spectrum, as Qualcomm spelled out recently, are also important. Facebook and Google may have spotted an opportunity for growth given the fact only 16 per cent of Africans are online, compared to 77 per cent in the developed world, but in order to increase this penetration costs must come down.
A 1GB data plan in Europe costs just two per cent of gross national income (GNI), but in Africa the figure increases to 50 per cent. This is far too expensive for the total rollout of connectivity to be a reality in the near future, with Facebook noting in its recent ‘A Focus on Efficiency’ report that the current cost of data is 100 times too expensive for it to be economically feasible to provide internet as a basic human right.
How to cut these prices – be it by building more efficient apps or launching thousands of balloons into African skies – is central to the whole idea of increasing the number of people in the developing world who have internet access, but identifying the problem – which the world now seems to have done – may prove half the battle.
