To crash high-speed Internet prices: 3 things Nigeria must STOP Immediately!

I started to write a post about the evolution of Internet connectivity in Nigeria, the challenges the network operators face, how quality of service is falling, etc but after churning out several pages without getting to the solutions, I decided to abort that mission and just talk about the part where we get better Internet access.

1- STOP buying retail Internet for large projects.
Buying in bulk comes with plenty of power but unfortunately, the major Nigerian buyers have opted to fritter that away. The major culprits are the Government agencies and local/international donor organizations that fund programmes like NITDA’s Rural Information Technology Centres and E-Libraries, MDG/SDG Computer Centres, NCC Computer Centres, CBN Computer Centres, XYZ Bank Computer Centres, PTDF Computer Laboratories and all other intervention programmes that provide computers and Internet access in remote locations. Rather than buy retail, the sponsors of these projects should purchase larger amounts of Internet bandwidth as a wholesale joint-venture buyer for their beneficiary centres.

I will explain with this real life example:
In the proposed 2016 budget, 892 Federal Government of Nigeria (FGN) entities are to spend an estimated 3.424 billion Naira on Internet connectivity alone. This total does not include the 3 billion Naira provided in the Service Wide Vote for “Funding of Galaxy Infrastructure”. Galaxy Backbone is the government-backed “Internet Service Provider”.

Assuming the best intentions by all persons involved in the retail purchase of Internet access for the Federal Government’s 892 entities, 3.424 billion Naira will buy a total of about 4,076Mbps (Megabits per second) dedicated Internet bandwidth for a year. This comes to an average of 4.5Mbps per FGN entity. Factor in corruption, nepotism, multiple taxation, multiple profit layers and this estimated average will be lower.

Buying wholesale from a maximum of 3 suppliers on the same annual budget of 3.424 billion naira, Nigeria can upgrade from 4,076Mbps to more than 15,000Mbps TODAY.

With a good strategy, the leverage could be even better. This will immediately increase the average connectivity per FGN entity from 4.5Mbps to 17.7Mbps.

2- STOP paying for rubbish services

Because corporate Internet connectivity is prepaid monthly/quarterly/annually and the actual users are mostly ignorant of the terms and conditions, network operators easily get away with frequent service outages and degradation.

Very few Nigerians are aware that they can penalize network operators for poor quality of service. Too many people just drop their shoulders in despair and accept frequent Internet service failure as a part of life.

If every major customer were to be like me and run automated systems that keep evidence of service availability and quality to enable administration of penalties against network operators, many service providers will sit up and provide better services.

Sadly, rather than deal with the underlying issues, the Nigerian customer will move to a new operator and grant a 1-year lease of life to another rubbish service provider with a sweet-mouthed smooth-talking sales team.

3- STOP relying on rental alone for services. Get creative and increase your infrastructure ownership.

Since the demise of the national telephone carrier NITEL, Nigeria has not had reliable national data communication infrastructure. Failure to support the use of creative ad-hoc solutions has further led to an over-dependence on Internet service providers. This over-dependence means that despite the workforce that we are spending billions of Naira to maintain, we are back to zero connectivity the moment we are unable to pay the rental bills. I can point to major projects that have toed this line but not today.

I will explain with an example that occurs regularly:
The government of Kasabubu State has 2 offices 5 kilometres apart and they need to interconnect them to use an application. They opt to pay Balloon Internet Limited who uses their money to put up an interconnecting link which Kasabubu then pays to use per Mbps on a recurrent basis.

It would interest you to know that Kasabubu state employs several Engineers that could have easily laid an optic fibre cable between these 2 locations and provided unlimited bandwidth but they were very likely not carried along in the decision-making process (assuming they are competent). If the State was smarter, Kasabubu would also have been able to generate revenue by leasing strands of their private cable to any Internet companies looking for connectivity along the same route. Or they could have used that connectivity for a swap deal with Balloon Internet Limited on another route of interest.

In conclusion
Without being the Federal Government of Nigeria, any organization could join forces with like-minded organizations to become wholesale joint-venture buyers that get wholesale benefits rather than retail restrictions. If you are unable to coordinate such a joint-venture on your own, you can join an existing one like the Bandwidth Consortium which has served the purposes of members (mostly in Research and Education) for over 10 years.

Despite the fact that I’ve focused on the public sector and corporate connectivity in the preceding part of this post, you should know that there is a direct correlation between the big buyers buying smarter and service improvement for small buyers. Every network route has recurrent Operations and Maintenance (O&M) expenses that are almost fixed; If a network operator has been able to cover her O&M costs, she is more likely to be more competitive in the market and further reduce prices across board. By getting the major buyers to do the smart thing, you would be helping yourself as well.

Please note that I write from the perspective of someone that has had a front-row seat in the evolution of Internet connectivity in Nigeria for about fifteen years. I have been in the industry either as a user, network operator, wholesale buyer, facilitator, value added service provider or government (sub)contractor so, (for the most part,) I know what I’m saying :-)

In the near future, I will write a follow-up that highlights more things we should START doing.