Broadband takes the footpath in poor countries

While the rapid spread of information and communication technologies (ICTs) around the world, especially mobile phones, is beating the expectations of most experts, there is a widening gap between the developed and developing worlds in the availability of broadband Internet access, and greater efforts are needed to narrow the divide, according to the UN Conference on Trade and Development (UNCTAD).

Broadband user

A person in a developed country is eight times more likely to be a broadband user than someone in a developing country, UNCTAD said in its “Information Economy Report 2009” released late last month.

“There is still a long way to go before we can claim to have significantly narrowed the digital divide’ to achieve an information society for all. Wide gaps in ICT infrastructure remain, not least in the case of broadband networks,” says UN Secretary-General Ban Ki-Moon.

While the digital inequality is shrinking, the gap varies by type of information and communication technology.

Comparing the diffusion of the different ICTs with the distribution of income in the world shows that mobile telephony (cellular phones) has become the most equitably distributed ICT.

At the end of 2008, there were about 4 billion mobile subscriptions worldwide.

(According to data released recently by the International Telecommunications Union, the number of mobile subscriptions is estimated to rise to 4.6 billion subscriptions globally by the end of 2009.)

On average, there are 60 subscriptions per 100 inhabitants, the UNCTAD report states.

Developing countries account for two-thirds of all subscriptions, corresponding to a mobile penetration rate of about 50.

In many countries, including developing and transition economies, mobile penetration exceeds 100 subscriptions per 100 inhabitants.

The LDCs raised their mobile penetration from two per 100 inhabitants in 2003 to 20 in 2008.

The penetration in developing countries is now eight times higher than it was at the turn of the century.

Growth in subscriptions was lower but remained close to the 20 per cent of 2008.

According to the report, the share of population covered by a mobile signal stood at 76 per cent in developing countries in 2006, including 61 per cent in rural areas.

Mobile coverage was about 90 per cent in East Asia and the Pacific, Europe, the Commonwealth of Independent States, Latin America and the Caribbean; and around 80 per cent in the Middle East and North Africa.

The report makes a case for greater liberalisation to promote mobile penetration.

“A glance at countries with the lowest mobile penetration reveals supply constraints caused by market restrictions. Countries with similar economic circumstances but with a liberalised market generally show higher penetration rates.”

Taxes can also act as a barrier, particularly import duties on handsets or special mobile communications surcharges, says the report, adding that “a common feature among top performers is liberalisation.”

The number of fixed telecommunications (such as land-line phones) subscriptions has been flat at around 1.2 billion since 2006 and even declining somewhat in the most recent years.

In countries where there has been growth in main lines, this has often been the result of so-called “limited mobility” telephone subscriptions using Wireless Local Loop (WLL) technology. The WLL is an alternative configuration of full mobility technology.

The service is “limited” because users are restricted from moving beyond their cell range with their handset due to regulatory restrictions.

Fixed wireless systems are less costly to install than copper-based fixed lines, notes the report.

There were an estimated 1.4 billion Internet users around the world in 2008, says the report, adding that the growth rate of 15 per cent was slightly lower than in 2007.

More than half of the developed world population is online (using the Internet), compared to only 15 per cent in developing economies and 17 per cent in transition economies.

However, the report notes that “there is some uncertainty regarding the measurement, scope and analysis of Internet usage in developing nations.”

Since official surveys are seldom carried out, most available data are rough estimates generally based on the number of subscribers or international bandwidth.

The digital divide between developed and developing economies is particularly wide in the case of broadband, the report stresses.

Australia, with a population of 21 million, has more broadband subscribers than the whole of Africa.

The report also points to the “broadband price divide” - the cost of using fixed broadband tends to be highest in low-income countries. Of the 20 countries with the most expensive broadband access fees, 14 are in sub-Saharan Africa.

Power parity

In addition, in 2008, the average fixed broadband price at purchasing power parity was $27.60 for developed countries and $289 for developing countries.

The fastest growing broadband markets are in large emerging economies, with China emerging as the largest broadband market, and the US coming in second, says the report.

But no developing or transition economy reached the top 20ist for broadband penetration.

“The promise of wireless broadband for developing countries is still far from being realised.”

TWN