Viability and sustainability of a satellite solution for Ghana

Community Broadband Network has been engaged by IICD to carry out the investigation. The report outlines the key findings of the work done by Adrian Wooster leading up to and during his visit to Tamale and Salaga in March 2007.

The document focuses on the technical challenges, the possible models for deployment, the possible business case, and the risks associated with this project.

To learn more about it, read the executive summary (below) or download the full SEND Foundation: Community Broadband Report (2.89 MB).  

Summary of the report

SEND currently has a nominal 128/64 kbps satellite broadband service which is a significant cost to the organisation, but which they feel is under used.

The community of Salaga are keen to source a reliable and affordable broadband connection to the internet. At the moment most organisations are limited to dial-up services, while household typically remain unconnected. Further a local entrepreneur is keen to investigate the opportunity for an internet café in the town.

From a telecommunications perspective, Ghana is arguably the most challenging of African states. A lack of investment and old world thinking by the incumbent operator, and a hard  and often illogical line taken by the regulator has resulted in a poor standard of telecommunications, with virtually no recognisable broadband services available outside of the capital, Accra.

The only viable solution for internet services beyond dial-up speeds is often VSAT satellite services; satellite services are always at a premium, especially across Africa, but in Ghana these can cost eye-watering sums due to a combination of exploitation of the market and curious and detrimental licensing fees imposed by the regulator. These challenges are explored later in this document under a general review of the Ghanaian telecoms market, and more specifically a study of SEND's broadband services.

When an organisation invests in a VSAT service, they clearly want to optimise the benefit. Where a connection is underused there is a clear case for sharing the bandwidth with other organisations and the wider community. Certainly the feedback from Salaga is that there is more than sufficient demand to create a viable and vibrant community network. Indeed, there is nothing to suggest this pattern is uncommon in Ghana; few communities have access to what many might call basic internet bandwidth at a reasonable price, and the strong sense of community suggests that a solution for Salaga will be replicable in many other communities across Ghana.

However, such a project is not without its risks. Aside from the issues with regulation, there are other factors which need to be considered before embarking on any telecommunications project in Ghana. The prime concern is the Government's policy of deploying Community Information Centres in each district town; these are effectively state-run Internet cafés which  significantly impact the business case for developing commercial alternatives.

Further, the Government has announced an intention to share the Internet capacity with other local government offices; this reduces the number of possible subscribers by removing the local hospital, education authority, finance office, and district assembly from the pool. Given that government functions are likely to become the largest Internet users, an alternative government run solution significantly impacts the viability of a community run or commercial project.

Conclusion

Sadly, the conclusion of this report is that, while there is significant demand for a broadband solution in Salaga, there are also significant risks. Until the intentions of the Ghanaian Government are made clear, it is far from certain that any Internet service, commercial or social enterprise, has a viable medium term future.

If the project could be viewed as an investment to create a exemplar project on which the Government might model other CIC expansions, ideally using Special Purpose Vehicles rather than making direct investments, then risks can be put into a context where the possible lack of long term sustainability can be weighed against possible demonstration in the short term of a replicable model for the Government working in tandem with the NGO community.

However, such an approach changes the immediate motive for the project from a sustainable community enterprise to that of a pilot for a wider expansion. A community owned enterprise that aims for long term sustainability cannot be expected to bear the additional risk associated with this approach, and would therefore require a significant proportion of the seed funding to come from external investors who will benefit from the more encompassing approach.

The case for “investing risk capital” in a pilot which might refocus Government policy and create an