Telecommunications consultant Roland Alden has an excellent essay on EASSy, the fiberoptic submarine cable proposed to link East Africa to the Internet, connecting a number of countries that currently access the Internet via high-priced satellite connections.
How can a plan to connect African nations to the net at much lower costs be a bad thing? Simply put, it doesn’t lower the costs nearly enough. As Alden observes:
EASSy would lower the cost of Internet access for these citizens by 50% to 75%. That sounds good, until you understand that by global standards it is shockingly inadequate. Internet bandwidth in Africa is not two or three times more expensive than in global competitive markets, it is 2000 or 3000 times more expensive.
Why’s the connectivity likely to be so expensive? Because EASSy is currently planned to operate financially with the same cartel structure used for the West African SAT-3 cable. While this high-capacity cable connects over a dozen nations with moderate to high bandwidth demands, it’s very sparsely used. Why? Because the owners of the cable – former state-owned telecom companies in Africa and major international telcos – have agreed to fix the prices for bandwith so high that most African entrepreneurs choose to use expensive, slower satellite connections than pay the extortionate monopoly rents demanded by the SAT-3 owners.
Those of us who hope that the revolution in voice connectivity we’ve seen on the African continent, brought by entrepreneurial cellphone companies, spread to data connectivity can’t help but be frustrated that EASSy is based on such an uncompetitive structure. Telecommunications companies have been suing the SAT-3 consortium for competitive access to their cable; early evidence suggests that the SAT-3 pricing structure is preventing businesses from using the capacity of the cable. Why would EASSy try to replicate the same bad situation?