Inside the $25bn plan to get the Middle East online

Inside the $25bn plan to get the Middle East online

Summary: In a region where internet access can cost 40 percent of a month's wages if it's available at all, there's much to be done before the benefits of broadband will be felt equally across the Middle East and North Africa.

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TOPICS: Broadband, Mobility
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An investment of at least $25bn is needed to fully develop fixed and wireless internet access in the Arab world, according to a new report published last week by the World Bank.

The report, Broadband Networks in the Middle East and North Africa: Accelerating High–Speed Internet Access, found that "with some of the highest rates of unemployment and the most youthful populations in the world, MENA countries have a formidable challenge to create and sustain economic and social opportunities for their people — and tech can  help address some of those formidable challenges".

However, according to one of the report's researchers, Joulan Abdul Khalek, "despite a good amount of work done on national broadband strategies throughout the Arab world, the significance of the internet as a social and economic development platform is still an alien concept to most parts of government."

The report itself is not quite so explicit in this criticism, but does highlight that broadband potential in the region remains largely untapped.

"In spite of broadband's potential to advance socio-economic development in MENA, the region is falling behind in terms of internet access and use, creation of digital content, and development of infrastructure," the report says.

Current issues

Fixed broadband markets, for example, are "largely underdeveloped" due to a range of factors including infrastructure, competition and high prices. As a result, in over 50 percent of the MENA countries, fixed broadband penetration is below 25 percent of households.

Mobile broadband fares a little better, however. "Mobile broadband markets in MENA are much more developed" due to the "quick development of mobile broadband markets is the presence of vibrant, effective competition," the report says.

Nevertheless, there are substantial differences in national markets across the region. For example, eight MENA countries enjoy mobile broadband penetration levels above 50 percent of the population – rising to more than 70 percent in Bahrain — while 3G and 4G services are not currently available in Algeria, the West Bank and Gaza.

Meanwhile, in Iraq and Iran — despite the fact that these services are nominally available — limited availability (in Iraq, for example the only 3G operator is currently confined to the Kurdish Region,) has resulted in mobile broadband penetration levels of less than one percent.

It's a similar story for other infrastructure areas, including the number of submarine cables landing in each country; while Egypt and UAE are connected to 12 or 13 cables, Jordan and Yemen have just two. For those at the lower end of the spectrum, there are negative effects on network connectivity and resilience, as well as end-user costs and opportunities for competition.

Moreover, the "patchy submarine connectivity between the Middle Eastern part and the North African part of MENA" means that rather than connecting with each other many of these cables merely connect Middle East countries directly with Europe or Asia. Consequently, "despite abundant international connectivity, the limited competition in international (and regional) connectivity has translated into high international charges for the region".

Regulatory and infrastructure solutions

According to the report, the potential remedies for these missed opportunities including calls for active and passive infrastructure sharing, as well as "regulations that facilitate and discipline the access to already constructed infrastructure".

Similarly, they also call for more joint efforts between utility companies and telcos. Although examples of these partnerships do exist — such as a collaboration between Oman’s state-owned utility company, Haya Water, and telecom operators (which resulted in Haya Water installing fibre optic cables in conjunction with its new pipelines) — the report says that this sort of joined up thinking does not happen as often as it should.

Elsewhere, the report also recommends looking into public subsidies for rural broadband development, broadband via satellite and including coverage obligations in telcos' licences.

Consumer costs

This technological mix could also help address the question of affordability in the region. High-speed internet access is deemed "prohibitively expensive" in most MENA countries and the report calculates that in Tunisia, the poorest 40 percent of the population would need to spend more than 40 percent of their income to afford it.

In contrast, subscription fees for high speed broadband cost less than two percent of monthly income in the United Arab Emirates, and typically less than five percent of monthly income across the Gulf countries.

More widely, even slower broadband services as seen as too expensive in many parts of the region. The report calculates, for example, that sixty percent of the people in Algeria, Djibouti, Morocco, Syria, Tunisia, and Yemen, "cannot afford fixed and/or mobile broadband services". 

Competition, compromises on speed, and introducing other forms of connectivity — including satellite broadband — could all play a role in remedying this situation. The report notes  that: "In all the countries featuring a mix of different internet access technologies (eg WiMax, xDSL, FTTx, 3G, etc), internet access prices are lower."

This matters, because as author Michel Rogy notes, "for it [broadband] to have its full impact, people will need access to it".

Accordingly, he calls for "a strategic framework of reform", which will "extend the geographical reach and resilience of national networks" alongside increased competition and expanded networks. These aspects, which combined with "lowering the barriers of cost, will ensure that broadband internet has its full developmental impact".

Read more on MENA

Topics: Broadband, Mobility

Damian Radcliffe

About Damian Radcliffe

Damian Radcliffe has been working in media and technology since 1995. He is currently based in Qatar where he is researching and reporting on the societal impact of ICT and emerging internet issues in the Middle East, as well as wider global developments.

This follows 17 years in the UK's commercial, public, regulatory and non-profit communications sectors, in a range of mid-level and senior editorial, research and policy roles.

Damian was elected a Fellow of the Royal Society of Arts in 2008 and Honorary Research Fellow at the Cardiff School of Journalism, Media and Cultural Studies in 2012.

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9 comments
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  • Rural internet for America...

    I so hope that America is not going to fund getting the Middle East online as an aid package, when Rural America is mainly without connectivity, short of satellite internet with all of its rain fade and latency issues.
    lrymal@...
    • Religious Nut-cases..

      Surely its worth a few American Dollars to watch the ruling religious nut-cases and psychopaths struggle with the censorship issues. Its worth BILLIONS just for the entertainment value :-)

      And that's before we consider the value of allowing anyone under 30 between Casablanca and Karachi the freedom to personally decide whether or not to view an image of the prophet.
      P0l0nium
      • What makes you think the ruling religious

        nut cases are going to take those American dollars and spend it on creating something they can't censor?
        baggins_z
        • That's possible but...

          That's a possible outcome but its hard to do even WITH a mostly compliant population.(as the Chinese are discovering, having just banned anonymous video sharing after attempting to censor them singly for years).

          A fully censored internet is, in any case, just another target for the young to throw rocks at.
          P0l0nium
    • Here's a thought

      The problems in the middle east are not because of lack of internet, but because of their culture.
      baggins_z
    • Do you know the expense of bringing fiberoptics to Rural America?

      It costs a lot of money (sometimes never recouped) to deploy a fiber to a remote location with a dozen folks and four dozen cows. :-)

      In a former life, I was president of Internet of Venezuela and this was my proposal: the fiber to remote locations (even large buildings) should be co-owned by all the cable+ISP providers.

      The end user could switch from a provider to the next easily, thereby implementing a competitive market.

      In some towns, the government (local, perhaps?) could somehow foot part of the bill.

      The Democrats will be all for it, but the Tea House will deny any support... For as long as there is a Black President in the House That Used to Be White.
      RamonFHerrera
    • It's in our best interests

      As soon as those backwood terrorists discover internet porn they'll reconsider becoming suicide bombers.
      new gawker
      • new gawker

        You're such a racist person
        Vindora
  • typical blindness

    "When the only tool in your toolbox is a hammer, everything looks like a nail."

    the low income and low progress of North Africa, and for that matter all of Africa, has nothing to do with internet access and never did. Between religious and tribal warfare there has never been a time of peace on that continent. The major religion of North Africa precludes the 'ordinary man' from any sort of modern thinking necessary to joining the modern economy as he is deliberately kept in a seventh century mindset by his masters.

    How is internet access going to free all the women of North Africa from bondage? That seventh century thinking will continue to plague them.

    As for "successful" examples of Arab modernity, you will find it only applies to the extremely wealthy who are European and American educated and only pretend to be following their enforced religion. You find them drinking, gambling, and boinking girls anywhere in the European big cities and in Asia as well. Then they go home and pretend to be following the path while they exploit their fellow arabs with low wages and harsh treatment and pay a load of baksheesh to the imams and ayatollahs for the privilege of their off the books lifestyle. Martin Luther started a revolution over similar behavior some five hundred years ago.

    All wealth belongs to the sheikhs, emirs, and kings. That is not a prescription for economic progress. Without a cultural revolution there will be no miracle economy for the ordinary folks in any part of Africa with or without any internet access.
    wizardjr