Why we aren't connecting the unconnected

Why we aren't connecting the unconnected

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Connecting the unconnected. You don’t have to look very hard at a telecom or digital infrastructure company’s marketing material or corporate social responsibility rhetoric to see this phrase. But Kyle Whitehill, CEO of satellite communications operator Avanti Communications thinks the whole idea needs a rethink.

“I was at a panel discussion at ITW this year and started to hear the same old stuff about connecting the unconnected, the 2.6 billion and so on,” he tells Capacity.

As he was listening, Whitehill said in an almost exasperated tone: “Don’t get up there and say all the same trite stuff”.

“It’s not true," he tells Capacity. "We’re not going to connect the unconnected by 2030. It’s not going to happen. Let me explain why and perhaps we can dwell on what needs to happen here.”

Firstly, Whitehill points out that the 2.6 billion people lacking access to connectivity today is the fastest growing segment of the Earth’s population, mainly situated within parts of Asia, India and Africa, the latter of which is where Avanti focuses most of its attention.

“In order to try and catch up with population growth is one thing, but we haven't even made a dent in the 2.6 billion in the last ten, fifteen or twenty years anyway,” he says.

With six years to go until the 2030 target, Whitehill is more than sceptical that the industry can close that gap, let alone the additional population growth that will take place in that time.

The people that need to be connected primarily live in rural villages in the regions already identified. Whitehill has experience living and working in these countries and continents and has seen first-hand the challenge that sits before us.

“That's both a physical challenge as well as a funding challenge,” he explains.

Starting with the funding challenges, Whitehill believes that there’s a lack of trust within the ecosystem dedicated to solving the problem. That ecosystem needs to consist of organisations that can fund infrastructure building in Africa, physically install it and then maintain it.

“Within that ecosystem, I don't see trust,” he says. “There's plenty of money in the world saying we want to build infrastructure in Africa, but it's just not happening because of lack of trust. They’re worried about where the money goes, and whether it is actually getting into the hands of people that are going to build the infrastructure?”

Aside from these charitable foundations, two other entities are looking at building infrastructure in Africa. African governments though don’t have enough capital to meet their objectives around connectivity in health, education, and employment.

“They don't have incremental cash to start building out,” Whitehill says. “That leaves the third entity that can do it, telecoms companies.”

But they face their own pressures. As for-profit companies, there’s a cost/benefit trade-off that is hard for them to see.

“A macro tower is going to cost around $250,000, and then you have to install half a million pounds of equipment onto it. That’s just one tower. Can an African telco CEO justify doing this across the continent in rural locations and dedicating tens or hundreds of millions of Capex into a market where the average revenue per user is less than a dollar?” Whitehill asks.

The answer is quite simple - No.

If the funders don’t have the trust, governments don’t have the money and the telecoms companies don’t have the incentive it's clear something has to change. But what?

For Whitehill, this question is easy to answer as well: give the money to the telcos. Whitehill says they are the only entity that can do this.

Many of them, Orange, MTN, Airtel and Vodacom are large internationally well-governed businesses, and they have the infrastructure to truly connect people. But they don’t have the economics.

A foundation like the Ikea Foundation or Bill and Melinda Gates, have many layers of complexity to navigate if they want to deploy connectivity to schools, for example.

They have to get government support, find a local NGO that can help to deploy their capital, and then make sure the end users are actually using it correctly for its intended purpose.

“If I'm sitting in Salt Lake City or New York it feels like I’m a long way away to get through those three significant layers,” Whitehill says of charitable funds attitudes.

“I think there's fatigue within the funders around the ability to physically get something deployed.”

The challenge, however, is the optics of giving a $10 billion company $500 million to build the infrastructure they already build as part of their day-to-day.

But Whitehill thinks this is the only way.

“Otherwise, it's just not going to happen,” he says. “We'll be talking about the unconnected for the next 30 years, and it won't have changed in the slightest.”

Whitehill thinks realistic conversations need to be had, rather than “sit through yet another seminar or interview where top people talk about connecting the unconnected with no connection to what's actually going to happen!”

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