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Broadband

Most countries in the world understand that broadband Internet is critical to becoming a knowledge-based economy, central to fostering substantial economic development and job creation, and strategic to the goals of reducing poverty and boosting shared prosperity. However, making broadband Internet ubiquitous and affordable remains a challenge.

In the global race for increased broadband penetration, public-private partnerships (PPPs) are an ever more useful instrument for implementing fiber optic projects required to carry the growing broadband Internet traffic.  Indeed, a number of fiber-optic backbone systems have been developed using PPP structures. The project company lays the fiber-optic cables to link key demand centers and sells access to various telecommunications operators and internet service providers. Where new-build residential or business developments are contemplated, PPP projects can provide the full range of audio, video and telecommunication services from fixed line telephone services to broadband video streaming. Alternatively, the provider of telecommunications services may sell services directly to individual end users.

Issues

  • Property

    For terrestrial fiber optic networks that are laid underground, access to long strips of land will be essential for installation. The project company will need the right to dig a trench in this strip of land, install ducts and the fiber cable...

    For terrestrial fiber optic networks that are laid underground, access to long strips of land will be essential for installation. The project company will need the right to dig a trench in this strip of land, install ducts and the fiber cable and have periodic access to jointing chambers or the fiber optic cable itself for maintenance and the repair of defects.

    Because it is in the interest of the public generally to allow the installation of broadband networks in order to improve services and connections provided to consumers, most governments will provide specific legal regimes to allow telecommunications companies to have access to property for the installation of the infrastructure.

    Where fiber optic cables are laid under the sea, it is not a property issue but rather one of protection and fortification. The cable must be armored and laid properly in order to protect it from ship anchor and other hazards at sea.

  • Access

    In developing countries and economies, there are those who benefit from the lack of information made available to the public. They may seek to undermine the relationship between the new telecommunications services and their customers, trying to...

    In developing countries and economies, there are those who benefit from the lack of information made available to the public. They may seek to undermine the relationship between the new telecommunications services and their customers, trying to lock in clients to financing, input supply, or other relationships that would deny them the benefits of the new information.

    In other cases, they seek to dominate access to new capacity, buying up capacity, or ensuring pricing is unaffordable. These can act like ill-placed river walls that divert water away from those areas that need it most in order to benefit from the drought. When financing such projects, a full stakeholder assessment can identify such interest groups and allow preventative measures to reduce their influence. Open access regimes can help to keep pricing at a sensible level and assure that access is well distributed.

  • Defining the scope

    Competition is the driving force for accelerated and sustainable telecoms market development. The experience of mobile communications, developed in most countries in a competitive environment, has allowed developing and emerging markets to reach...

    Competition is the driving force for accelerated and sustainable telecoms market development. The experience of mobile communications, developed in most countries in a competitive environment, has allowed developing and emerging markets to reach levels of penetration similar to those of high-income countries in a short period of time. Competition triggers private investment and incentivizes operators to be more efficient. As a result, it ensures maximum benefits for end users, both in terms of quality and prices.

    Consequently, it is key to ensure right from the outset that the scope of the broadband PPP does not reduce competitive dynamics. Broadband PPPs should focus on infrastructure that the private sector would not do alone for quite some time, either on a stand-alone basis or by engaging voluntarily into some form of infrastructure sharing to reduce investment costs. In developed countries, authorities have set up so-called infrastructure databases to keep track of existing and planned fiber rollout, and agreed on an appropriate time horizon (typically around three years) to identify areas where the private sector is considered unlikely to invest.

    Similar principles should be applied in developing and emerging countries by consulting operators in a transparent process. This would involve discussion of planned fiber optic investments in their strategic plan, which often spans three to five years. In some small or fragile states, this may lead to a need for a PPP for international fiber connectivity in the form of a submarine cable landing station that the private sector is unable to finance on its own.

    When authorities are striving for national fiber connectivity to all provincial capitals and borders to create a national backbone to support broadband traffic throughout the territory, a PPP on some or all missing fiber optic links may be advisable. Finally, there will also be a need to expand broadband in rural or remote areas using public subsidies. In this case, it’s necessary for the PPP to ensure that public objectives are met. Avoiding the creation of a digital divide, which exists in many developed countries, is key.

  • Best PPPs for risk sharing

    Once the scope has been defined, selecting the appropriate type of PPP is important. The decision should be made to ensure that public funds will be used in the most effective and efficient manner while encouraging as much private sector...

    Once the scope has been defined, selecting the appropriate type of PPP is important. The decision should be made to ensure that public funds will be used in the most effective and efficient manner while encouraging as much private sector involvement—and especially risk sharing— as possible. These PPPs can take a variety of forms, including lease/affermage, design-build-operate, or concession PPPs. Analysis of pros and cons in the specific country context should be conducted in a transparent manner.

    The decision on the type of broadband PPP is easier once a reasonable consensus on the business case has been achieved. Because broadband Internet is a new service in many developing countries, demand is uncertain and growth cannot be reliably predicted. This is particularly acute for investments in less populated areas, where there is a need for so-called “patient capital.”

  • Legal and regulatory framework

    A telecoms regulatory framework is central for a broadband PPP’s effectiveness. First, in terms of licensing and authorization, there is a need for a “carrier’s carrier” status. In order to preserve competitive dynamics at the retail...

    A telecoms regulatory framework is central for a broadband PPP’s effectiveness. First, in terms of licensing and authorization, there is a need for a “carrier’s carrier” status. In order to preserve competitive dynamics at the retail level, it is best practice to require the broadband PPP to be active purely at wholesale level, providing the existing operators and service providers with the necessary inputs that will enable them to serve end users.

    Should the broadband PPP be the sole provider of the necessary inputs—as is the case with international submarine capacity in Sierra Leone; the national fiber optic capacity between the capital city and the provincial capitals in Burundi; and the local capacity in the Limousin Region in France—there is also a need for market power regulation. This will prevent any abuse of a dominant position that would negatively impact the downstream broadband value chain. It involves a complex establishment of service, content, and application providers.

Tools & Guidance

    • 2012
    • European Investment Bank (EIB)

    Broadband – Delivering Next Generation Access through PPP

    Access to the Internet at increasingly higher connection speeds, is assuming a key role in guaranteeing both economic prosperity as well as social cohesion. The European Commission (“EC”) has therefore set out an ambitious programme for increasing the accessibility of Internet provision in Europe under its Next Generation Access (“NGA”), a programme with ambitious roll-out targets that include improving download speeds so that all European Union (EU) citizens will have Internet access at 30 Megabits per second (“Mbps”) by the year 2020 and that 50% of households will have the ability to access the Internet at speeds of 100 Mbps or more. EPEC has worked with the European Investment Bank (EIB), and EC member states to investigate when and...

    • 2011

    Telecommunications Regulation Handbook

    This new edition of the Telecommunications Regulation Handbook captures the new market and regulatory strategies to optimize investment in broadband networks and ICT services. As the following chapters show, many of the evolutionary and revolutionary changes in regulation that made possible the mobile miracle of connecting 5 billion users worldwide with access to ICTs, as well as over a billion fixed and mobile broadband subscribers, are still valid today. But for markets to truly flourish, regulators also need new, inspired regulatory approaches that are as innovative as the technologies they regulate. This new and revised edition of the Handbook focuses on examining these new expectations and identifying the regulatory approaches...

Projects & Case Studies

    • 2015
    • World Bank Group (WBG)

    Central African Backbone Project

    World Bank project summary and associated documentation of the Central African Backbone Project, The objective of the Central African Backbone (CAB) Program Project is to contribute to increase the geographical reach and usage of regional broadband network services and reduce their prices. There are four components to the project, the first component being enabling environment. This component aims to: (i) promote further regional market integration; (ii) strengthen the legal, regulatory, and institutional framework; (iii) support market liberalization; and (iv) promote the establishment of infrastructure that once in place is accessible to all service providers on open, transparent, competitive, and nondiscriminatory terms. The second...

    • 2014
    • Tenzin Norbhu
    • World Bank Group (WBG)

    Myanmar Connected

    The Liberalization of Myanmar's Telecom Sector

    Political and social transformations in Myanmar have made possible reform of the country’s telecommunications sector. Liberalization has allowed a country with the lowest rates of telecom penetration to leapfrog into the digital age. In February 2012, it cost $300 to buy a mobile SIM card anywhere in Myanmar—that is, if such a rare find made itself available. But just over two years later, in September 2014, you could easily purchase one for $1.50—and have your choice from among three operators.

    • 2005
    • Pierre Guislain, Mavis A. Ampah, Laurent Besancon, Cecile Niang, and Alexandre Serot

    Connecting Sub-Saharan Africa: A World Bank Group Strategy for Information and Communication Technology Sector Development

    This paper outlines a strategy for information and communication technologies (ICT) development in Sub-Saharan Africa that will further the reform agenda to facilitate deployment of ICT infrastructure, and encourage the development community to support African governments in this regard. The strategy is composed of three pillars: the core reform agenda (market liberalization, regulation, capacity building, privatization, and postal sector reform), addressing market failures (rural access, national backbone, and post-conflict countries), and ICT for development applications (e-commerce, e-government, and civil society applications). To make the case for sector reform, t he report reviews the benefits of telecommunications reforms in the...

    • 2012
    • World Bank Group (WBG)

    Public-Private Partnership in Telecommunications Infrastructure Projects

    Case of the Republic of Congo

    This paper delineates the role of government in infrastructure PPPs in telecommunication sector in the Republic of Congo. Besides its critical role in promoting universal access at this time of convergence and the edge of information technologies, PPPs offer policy makers an opportunity to improve the delivery of services and the management of facilities and helps to mobilize private capital which in turn speeds up the delivery of public infrastructure. Along with power and transportation infrastructures projects, telecommunication figures among the most growing areas in PPP projects in Africa. It also summarize the achievements and challenges in Congo’s ICT economic infrastructure sector, the capital investment needs in the broadband...

Lessons & Analysis

    • 2010
    • Yochai Benkler, Robert Faris, Urs Gasser, Stephen Schultze, and Laura Miyakawa
    • Harvard University

    Next Generation Connectivity

    A review of broadbank internet transitions and policy from around the world

    On July 14, 2009, the Federal Communications Commission (FCC) announced that the Berkman Center for Internet & Society at Harvard University would conduct an independent expert review of existing literature and studies about broadband deployment and usage throughout the world and that this project would help inform the FCC's efforts in developing the National Broadband Plan. The Berkman Center's Final Report was submitted to the FCC on February 16, 2010.

    • 2010
    • Yochai Benkler, Robert Faris, Urs Gasser, Stephen Schultze, and Laura Miyakawa
    • Harvard University

    Next Generation Connectivity

    A review of broadbank internet transitions and policy from around the world

    On July 14, 2009, the Federal Communications Commission (FCC) announced that the Berkman Center for Internet & Society at Harvard University would conduct an independent expert review of existing literature and studies about broadband deployment and usage throughout the world and that this project would help inform the FCC's efforts in developing the National Broadband Plan. The Berkman Center's Final Report was submitted to the FCC on February 16, 2010.

    • 2014
    • World Bank Group (WBG), International Finance Corporation (IFC)

    Handshake Issue #15: Connectivity

    Handshake's issue 15 focuses on connectivity or the physical networks that allow people to communicate as well as the ability to interact with another person or the services one receives from an institution or organization. Public-private partnerships in information and communication technology can help create those connections and most importantly connect the still unconnected. Throughout the issue, we see how transformative ICT has been in the developed world and also acknowledge how far there is to go until everyone is given the same digital resources. We hear first-hand from the head of Facebook's internet.org initiative, which aims to bring free internet access to the base of the pyramid. Other articles and interviews show how...

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