Though there is progress in improving telecommunications infrastructure in African urban centres, large parts of rural areas still have no access to telecom services. Jerome Poucin, Sales and Marketing Director at RascomStar, explains the role his company is playing to develop sustainable telecom solutions in remote areas.
For more than a decade, most people in urban Africa have the opportunity to get access to GSM and Internet connection to communicate with the outside world, to exchange information, access to e-services such as payment and shopping better. We are in 2015 and there is still a large gap between urban citizens who are accessing 21st century e-services and people in rural areas, who are not covered by any telecommunication network.
Large areas of Africa are still without phone services. In many remote regions, just a few per cent of the population has access to a telephone. And what should we say for the connectivity to the Internet?
Today the African telecom market is led and controlled by the mobile operators, mainly a few multinational corporations. The other telecom bodies (Internet Service Providers, Fixed line telecom operators, etc) are minor players. Those GSM operators seem to cover 60 to 80 per cent (even sometimes more) of the population. The figure is not true, and available data varies significantly depending on the source – whether they come from the GSM operators (optimistic), or from the regulators (more conservative in their coverage estimates). For sure, the networks cover all the major urban centers but there are still large swathes of rural Africa without any telecom point of presence. Why? Because the rural subscribers are costly to reach and the revenues are very uncertain: there is no adequate information about the population size in ‘white’ zones (areas not covered by any network) and their financial resources.
The challenges of extending GSM coverage to rural areas in an economically sustainable way are well known: they include lack of grid power and terrestrial telecommunication backbones leading to high costs of connectivity; difficult logistic, maintenance and operation, etc. All those combine to make the business case unattractive for operators.
Then what are the potential benefits that are foregone when several hundred million people living in rural areas of Africa’s 1 billion more citizens are effectively cut-off? Everyone is convinced that there is a market to cover rural areas but nobody is willing to start doing it, to invest time and money, to take risks, to make mistakes, to learn from the field.
There is an untapped market that telecom players and mainly mobile operators are still reluctant to address by themselves. The hundred millions of currently unserved, rural potential subscribers are even not clamoring for cellular voice and data broadband connectivity. They are desperate and fatalist. Rural citizens have no voice to be heard.
Today, many are predicting access to the latest broadband technologies for all Africans: 3G, 4G, and 5G. The market leaders are promoting and implementing broadband infrastructure in very limited urban areas. At the same time, so many African citizens would like to have a phone box or a 2G coverage at a walking distance from their home! The gap gets wider between highly dense urban network and rural deserts.
Benefits of connecting rural areas
We all know how people need to communicate with their family, friends and neighbors, regardless of distance. We all know how telecommunications is an enabler and a booster for economic development and growth. Bringing communications to rural areas and isolated communities will give obvious advantages for the people living in those regions: more information, more health, more education, more trade, more productivity, more entrepreneurial opportunities, etc that will result in more earning power, more comfort, more stability, and more security.
Telecom has a positive impact on the economy everywhere, especially in remote isolated areas. Farmers can use their mobile devices to access current market prices on agricultural products. Tradesmen can organize their commercial activities remotely. Logistics costs can be minimized because information is accessible. Medical problem prevention and diagnostics, medicine supply, are facilitated as soon as information can be shared. And educational content can be broadcast to rural schools easily.
The impact of telecommunication on social capital is considerable. The telephone brings a lot in rural areas, especially where family members live remotely (in the capital city or abroad). Access to the Internet and to e-services will reduce the distance between isolated communities and urban centers.
Even if rural telephony remains the first need for a population still without voice, the emergence of e-services (trade, education, medicine …) will increase the demand for broadband data in addition to voice. This trend will be a leading enabler of economic growth, and data related services will trump voice as a vital need in the coming 5 years, even in rural areas.
Many studies have already shown the positive impact of the telephone penetration on economic growth everywhere, and especially in emerging countries. What is true for a developing country will be true at a regional level, and rural areas will benefit from the access to the telecommunication networks.
- Mobiles save people living in rural communities the financial costs and time involved with travel. As a result, 85 per cent of people in Tanzania and 79 per cent in South Africa said they had greater contact and improved relationships with families and friends as a result of mobile phone.
- 62 per cent of small businesses in South Africa and 59 per cent in Egypt said they increased their profits as a result of mobile phones, in spite of increased call cost.
- Over 85 per cent of small businesses run by black individuals in South Africa rely solely on a mobile phone for telecommunications. The results of this study suggest that growth in the African telecom market will continue to pay off African economies.
RascomStar answering the challenge
During the last decade, telecom operators deployed a lot of transmission backbones between large African cities (optical fiber and microwave links) and between Africa and the other continents (submarine cables). This was to meet the growing demand for broadband data and voice traffic.
Nevertheless, the deployment of those information highways is long-term and is focused on dense areas. This leaves room for satellite connectivity where distances are huge and when population is less dense. Satellite remains the most appropriate access technology to reach rural Africa because the connectivity is always feasible whatever the location, the distance, the relief, the vegetation; the links are easy and fast to deploy; the investment cost is under control and the recurring operation cost can be minimized.
RascomStar operates the RQ1R satellite, which provides a unique coverage of the whole African continent and Southern Europe. The mission of RascomStar is to develop sustainable and profitable solutions for telecommunications in remote African areas. Our objective is to differentiate our offer from other satellite service providers: instead of offering raw transmission capacity, RascomStar sells end to end managed services, including the ground equipment and stations.
RascomStar provides an end-to-end service to connect the rural end user handset to its mobile operator core network. This includes a low cost GSM site (installed in the rural community), a satellite backhaul and a gateway (at the operator network center). RascomStar selected Viasat, a leader among ground equipment vendors, to develop those low cost rural stations, well suited to rural areas and severe environmental operating conditions.
No other satellite operator has the combination of the ground technology and satellite connectivity; no other satellite operator proposes pay-as-you-go or revenue sharing models for rural telecom services. RascomStar is offering a low cost solution with attractive business models that reduce both Capex and Opex and allows the extension of GSM services to rural areas in a sustainable way.
RascomStar has partnered also with infrastructure companies to optimize the design of the whole rural sites including telecom equipment, power supply plant, tower, civil works, fence, etc. This optimization will save costs, will facilitate installation and operation and will secure equipment.
More and more, Telecom operators are outsourcing the acquisition, operation and maintenance of their sites. RascomStar and its partners are able to propose full OPEX solutions where the operator does not anymore invest in its network but just shares its revenues from the traffic. RascomStar is able to build the whole eco-system to create affordable and sustainable rural networks. In that sense, RascomStar’s brand is unique because it covers all the components to address the rural market as requested by the telecom operators: a satellite; the most efficient VSAT technology; low cost GSM base stations; optimized solar power plant; infrastructure designed for small communities; and appropriate revenue sharing scheme.
Now, it becomes possible to bring telecommunication to underserved areas in a cost effective way and generate affordable, profitable and sustainable services.
RascomStar realizing its investment in Africa
The first live deployments of RascomStar rural telecommunication solutions have confirmed that telephony in rural areas is in very high demand from the local population. Whereas people in the cities have had GSM for years, it’s only now that villages and small remote cities are benefiting from GSM services. This is a fantastic boost to the local economic and social development of these areas since there is a whole ecosystem that is being built around it.
RascomStar is answering the challenge of connecting the unconnected and together with our partners, we are unlocking the hidden potential in rural areas. We are giving a voice to heartland Africa.