Dear Colleagues,

A quick set of numbers about a specific situation with regard to VSAT
connectivity:

As of September 2004, secondary schools in Uganda were able to purchase
new KU-band VSAT terminals for US $2800 from the Ugandan offices of
AFSAT.

Monthly connection costs under volume-based pricing (1GB total traffic
per month) is about $230. Recognizing the realities of school funding
cycles, AFSAT bills schools at the beginning of each term, when school
fees are collected.

Roughly 45 rural secondary schools now have VSATs under this program,
which was launched in the spring of 2003. A few of these schools serve
very disadvantaged communities, and have received upfront capital in the
form of grants. Most of the 14 that we've looked at are covering their
recurrent costs via combinations of school fees and community-focused
operations.

AFSAT representatives say that their company is approaching the school
market aggressively, and fairly, because they believe that schools are
credit-worthy, in contrast to many cybercafes and other private
operators in rural areas. They also understand, rightly, that as
technology penetrates schools, schools will serve the largest installed
base of computer and Internet users in Uganda's agriculture-based rural
areas.

This arrangement is far from perfect. In particular, some schools have
more than 1GB of traffic per month, which results in increased costs for
AFSAT and radical slow-downs in connectivity speeds at those schools.

But the situation is interesting because it's arisen out of market
demand and opportunities, which are being met by a largely responsible
private-sector provider.

In mid-2005, the Uganda Communications Act will expire. Intended, in
part, to shelter Ugandan telecommunications companies during the
emergence of the telecommunications sector country-wide, the Act has
kept potential competitors from entering the VSAT market. One effect of
its expiration MAY be a further lowering of prices.

Bushnet, another private-sector provider, is also offering wireless
connectivity in rural Uganda via -- I think -- microwave hubs. Cost of
each hub is I believe upwards of $6K U.S., but these are intended to
provide service to clusters of communities using 802.11 technologies. As
of my latest information, there are over 30 hubs located in urban and
rural areas.

I'm offering these numbers in part to add to the general storehouse of
information that this discussion has built up. I'm also concerned that
private-sector successes in providing Internet access not be overlooked.

The possibility of a social enterprise providing Internet connectivity
to multiple communities, as Jeff has proposed, is intriguing. To be
successful, however, an enterprise of this sort would need to compete
against private-sector providers. The organization would itself be, in
essence, a private-sector provider, yes?

Best wishes to all for the New Year!


Ed Gaible


ADDENDUM: Has it already been pointed out that from 1995 to 2000 there
was a huge subsidy (of a sort) of "first-mile" Internet connectivity?
With the ballooning of the US stock market, literally billions of
dollars were invested in vast fiber-optic networks that were laid across
North America and Europe, and in satellite and Internet backbone
companies such as Global Crossing that were operating internationally.
When those companies went belly up, the wealth that drove that
infrastructure expansion vanished. But all the infrastructure remains in
place, "subsidized" by the investors whose stocks lost value. The
question is (imho) what are the factors that keep that stuff -- huge
webs of fibre and galaxies of satellites that are ready and waiting --
from being used at an affordable price?


On 12/31/04, "Jeff Buderer" <[EMAIL PROTECTED]> wrote:

..snip...

> The reality of these extremely high ICT costs causes many to think twice
> about the ICT sensation among aid and development gurus and to look
> critically at these programs. I am encouraged by discussions here and
> plan to look more deeply and carefully at the economic logic beyond ICT
> augmented development programs. I think this is particularly important
> because the potential of ICT to transform lives, if properly and
> effectively applied, is extremely high.
> 
> I was wondering what other experiences there are in this group with
> relation to satellite in terms of costs, reliability and how they
> compare with the other forms of Internet connectivity.
> 
> In an off list discussion with Lee Thorn and several others, we have
> begun to explore some of the issues associated with ICT and particularly
> in relation to the high cost of satellite. This led me to do research to
> actually explore the costs.
> 
> One of the concepts that my org OVF is exploring is the idea of
> developing a satellite system that would share the cost of the satellite
> with surrounding communities through a wireless system using similar
> technology as developed by Tim Pozar for the BARWN project
> <http://www.barwn.org/>.

..snip...



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