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Leapfrogging Internet Infrastructure Deficit for Nigeria’s socio-economic development

By Editor
25 March 2015   |   12:30 am
Unarguably, from general information dissemination to skill acquisitions, business growth and mobile banking, social activism and entertainment, further opening of the Internet industry has greatly expanded Nigerians’ reach.

Connection-picNIGERIA recently emerged as the largest economy in Africa, a continent that is slowly shedding its ‘dark continent’ reputation, but it must overcome its infrastructure deficit-particularly Internet infrastructure- in order to maximize its growth potential.

The World Bank estimates that a 10 per cent increase in broadband access can create a 1.4 per cent increase in GDP because access to reliable Internet brings services closer to the people that use them. Nigeria needs a national backbone infrastructure that will transport broadband capacities from the shores of its coastal cities where submarine cables are currently berthed to the hinterlands in order to improve Nigerians’ ability to innovate.

As countries are faced with changing economic circumstances stimulated by globalization, falling oil prices, and security concerns, it is more important than ever that Nigerian stakeholders encourage capacity development in established areas of growth. After the telecommunication sector was deregulated, it grew from the monopoly of an inefficient Nigerian Telecommunications Limited (NITEL) and a few dial-up e-mail providers to several mobile network operators and Internet service providers (ISPs). The vibrant ICT industry now yields 22 per cent of the service sector’s 51 per cent contribution to Nigeria’s GDP. It also gave rise to the phenomenon of Internet millionaires—Nigerians who have the Internet to thank for their livelihood.

An example is Linda Ikeji, Africa’s most popular and wealthiest blogger who in seven years turned an inconspicuous corner of the Internet into a multimillion Naira enterprise that attracts about 100,000 visitors daily.

Unarguably, from general information dissemination to skill acquisitions, business growth and mobile banking, social activism and entertainment, further opening of the Internet industry has greatly expanded Nigerians’ reach.

It is crucial now more than ever, to highlight the lingering challenges of inadequate Internet infrastructure. The rapid growth and enhanced availability of IP has created an explosion in demand for data and Africa is relying on mobile to deliver that. Nigeria alone has over 130 million active mobile phone lines with a rapid transition taking place from feature phones to smart phones but a better mix is required to support the rate of growth taking place and ensure long term sustainability.

According to the Nigerian Communication Commission (NCC), there are now over 130 million active mobile lines in Nigeria, and 50 million Internet users-about 30 per cent Internet penetration and seven per cent broadband penetration rates. Mobile is dominant because fixed infrastructure has not been rolled out aggressively. While lack of access to electricity and low computer literacy constitute deterrents for both residents of rural and urban areas, high cost of internet access continue to be a hindrance to Internet adoption as a majority of Nigerians-112 million of whom the Nigerian Bureau of Statistics calls poor-find it unaffordable.

In both rural and urban areas, those who have Internet connections continue to be frustrated by slow or inconsistent Internet speed due to insufficient fixed data infrastructure. In rural areas however, Internet penetration rates are even lower and almost negligible. On the supply side, ISPs require intensive capital to build infrastructure. They are further burdened by the costs of poor electricity supply to power their infrastructure, and the high costs in acquiring Right of Way. Ineffective distribution and transmission of available bandwidth from the country’s shores to inland cities and towns is also a factor that keeps Internet costs high. Infrastructure is needed to reduce pressure on existing spectrum and provide GSMs and other mobile operators with the transmission and backhaul services that will help them support the additional demand on their networks.

Nonetheless, we continue to record notable successes; an instance is ICT’s contribution to Nigeria’s GDP hitting $50 billion in 2014 alone. More so, several companies are rising to fill the gaps in Internet infrastructure. One of such is Phase3, a backbone infrastructure company that has exclusive Right of Way to operate an aerial fiber optic network along Nigeria’s power infrastructure and into the ECOWAS region. With its operation of over 7,000km of installed capacity (the largest independently owned fiber optic network in West Africa), the firm continues to show its commitment to rapidly expanding its existing network across West Africa to address the infrastructure deficit while offering direct connections to homes and businesses with the use of affordable broadband connection. More so, Phase3’s non-discriminatory and neutral base has certainly established it as a “carrier’s carrier” and the rallying point for operators.

For Phase3, to rapidly bridge the ‘digital divide’ between Nigeria and the rest of the world, as well as rural and urban Nigeria and to improve the lives of our citizens; more must be done to compliment recent efforts. As ICT is a proven enabler for rapid growth in the wider services sector, and its adoption in numerous countries has led to innovation and advancements on macro and micro levels. Unchecked deficit of Internet infrastructure will hamper development and faster growth thus; Nigeria must work harder with stakeholders to implement a clear broadband supply chain that comprises international connectivity, a national backbone network, metropolitan access links, and its local access network.