Future Investment Needs
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international bandwidth combined with lower prices that can be delivered over these submarine fiber-optic networks will dramatically improve the financial viability of the infrastructure and therefore reduce the amount of subsidy that is required to reach universal coverage targets. These results are as striking as those for mobile voice networks. Broadband Internet in the past has been considered a luxury not commercially viable in Africa. This analysis shows, however, that basic wireless broadband is commercially viable in large parts of the region and that networks could expand to cover nearly three-quarters of Sub-Saharan Africa’s population—if private investment is encouraged and effective competition is established. Although no country in the region is close to this level at the time this was written, the experience of wireless broadband in countries such as Kenya and Nigeria gives an indication of the potential demand for the service throughout the region. The basic broadband being discussed would, however, provide Africa’s population with a level of Internet access no longer considered acceptable by customers in high-income countries. Globally, expectations of the quality of the broadband experience have raced ahead as investment has poured into network infrastructure. The infrastructure required to deliver a comparable broadband experience in Africa does not break even at the consumer spending levels considered affordable for the mass market in this study. This does not mean that no feasible market exists for individual broadband service in Africa, but that, unlike mobile voice services, it is not yet widely affordable. The situation may well change over time as wireless broadband technologies and applications mature and become less expensive on a global basis. The challenge facing African governments is whether to allocate their resources toward subsidies of broadband infrastructure and, if so, how to target those subsidies for maximum effectiveness. Broadband Internet access is simply a pipe, unlike voice telephony, that represents a well-known application for which market demand has been amply proven. Providing the infrastructure is only the first step toward realizing the potential benefits from broadband access. Without concomitant investment in education, technical skills, or facilitated access, publicly funded subsidies of broadband infrastructure could remain stranded and unproductive. The models in this study suggest that shared broadband access underpinned by private sector infrastructure may continue to offer a valuable service to African populations for the medium term as markets expand toward commercially viable levels of individual access.