A4AI’s Internet Affordability Index – The African countries making progress towards affordability
The Alliance for Affordable Internet has published its 2015/2016 Affordability Report that contains two sets of stats that should be of interest to those working in Africa: a ranking of Internet affordability and an index of affordability drivers, both by country. Russell Southwood spoke to Dhanaraj Thakur, A4AI’s Research Manager about how the report is put together and what it shows.
Anyone who has spent any time compiling Internet costs across multiple countries anywhere (but in Africa) knows what a complicated process it is. Also trying to capture the complex mix of things that create affordability is no simple task.
The pricing data comes from the ITU database and it is two years out of date (2014). In compiling the database, the ITU chooses the largest operator in a given country with cheapest plan for a prepaid 500 Mb data bundle and a post-paid 1 GB data bundle. According to Thakur:”Their argument is that this will be the most representative of (the prices in) a country.”
Therefore the Affordabilty Drivers Index – which is the bit that’s been updated – has two broad baskets of input: access and infrastructure drivers. These are assigned a score and turned into a single index figure. The drivers include things like whether there is an IXP in place and if there is infrastructure sharing. The original part of the research is that A4AI conducts its own policy surveys. However, at draft stage these results are all peer-reviewed by local experts.
Out of the 51 countries surveyed globally, only two African countries feature in the full ranking: Morocco, up from 12 to 7; and Mauritius, down from 7 to 8. In the top 5 Least Developed Countries, there are 4 African countries: 1. Rwanda (11th in the overall ranking); 2. Uganda (16th in the overall ranking); 3. Gambia (20th in the overall ranking; and 5. Tanzania (30th in the overall ranking). But as Thackur says:”You can score high amongst the LDCs but there’s still a lot to be done:’
So why did Rwanda do so well in the Index:”It has been working a lot on national broadband policy, a national PPP and open infrastructure. It ends up scoring higher by putting the emphasis on the right things.”
The report highlights the inadequacies of current agreed metrics for measuring affordability. It notes that with a US$48 smartphone and a 500 MB pre-paid data plan, the cost of the smartphone alone (spread over 12 months) takes out an entire income quintile in affordability terms:” We propose a new “1 for 2” target: 1GB of data priced at 2% or less of average monthly income”. The higher data allocation acknowledges how little you can actually do with 500 MB over a month.
Although the cost of device + cost of data bundle point is well made, smartphones are now down in the US$25-30 range and places like Senegal now have a 52% penetration rate.
The report also reinforces work done by both its sister organization the Web Foundation and by the GSMA on the gender gap. Recent research by the Web Foundation shows that poor urban women are 50% less likely to be connected to the Internet than men in the same age group with similar levels of education and household income.
This is not some wooly, political point but a way in which the market is unnaturally constrained. The less women use these tools, the less business there will be for operators.
So what are the three things in Thakur’s view that everyone needs to focus to create a more widely used Internet with affordable access?
“Firstly, we need to use the correct metrics, which why we’re calling for the new “1 for 2” target: 1GB of data priced at 2% or less of average monthly income. Secondly, device prices are very important and we need to pay attention to all the things that increase their costs like taxes, royalties and patent costs. Thirdly, the gender is extremely important. Currently national broadband plans don’t focus on the gender gap.”
For details of the Internet Affordability Index, click on the link here:
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