To start, let me acknowledge the problem: the business case for broadband in emerging markets gets very difficult the further away you get from major economic centers. Thus, Facebook’s experimentation with exotic technologies like this week’s 5G from hovering airships.
The challenge is obvious. Emerging markets are often characterized by low average incomes exacerbated by a high Gini – a skewed income distribution which means a small number of very rich people and a large number of very poor ones. Furthermore, population dynamics over the past decades has created a small number of mega cities and a sparsely populated hinterland.
Note that the issue is not population density per se. Colombia’s population density is 43.9 per square kilometer, Brazil’s is 24.7. But the United States is 33.2 (right in the middle), and Canada 4.0. But population density, low income and a skewed income distribution create a small addressable market that is hard to reach outside of major cities.
Wireless broadband technologies have solved the technological problem with the ‘last mile’. They have also largely solved the economic problem with the ‘last mile’. But the real issue is the last 100 miles, i.e. backhauling the tower to the Internet. Kilometers of jungle or desert or dense forest or mountains do not make the problem any easier.
Television solved this problem with satellite. Those who could afford it simply put up a dish and ordered a decoder. Communities pooled resources and then distributed the signal or made sure that a few strategic points had service. (Often without paying for the service but that is an issue for another day.) Today’s HD services are light years beyond where quality was a few decades ago, but many people are satisfied with seeing Ronaldo; they do not necessarily need to read the label on his jersey. I doubt there are many spots in the planet that lack some sort of television service.
The same is not true for Internet, especially broadband internet.
Thus over the past twenty years or so we have seen a number of ‘beam from above’ solutions, starting with Iridium (hardly a mass-market offering) and passing through other LEO (Low-Earth Orbit), MEO (Mid-Earth Orbit) satellites to other, more exotic ideas like balloons and, lately, even drones. Latin American governments have been racing to put up geostationary satellites.
And now Facebook’s airships at 65,000 feet. (Since Facebook is such a young company, maybe no one there has even heard of Tom Swift and his Flying Lab – maybe my readers haven’t either (see Title Reference below). So the inspiration is probably SHEILD’s flying fortress from the Avengers’® movies. Without a doubt they have seen that. But maybe they skipped the scene in Captain America: Winter Soldier® when the fortress crashes into the Potomac. Forget that fear of gravity / Get a little gravity in your life)
I hate being an old curmudgeon but none of these ideas has ever worked. Microsoft investigated flying something-or-others over a decade ago. Google recently parked its foray into exotic airborne solutions earlier this year. Iridium still works but it is an expensive solution – an only-if-you-really-need-it-service. Geostationary satellites work for broadcasting or store-and-forward applications like email but not for latency-sensitive applications.
I think the reason can be found in Colombia’s experience with its national backbone which brought fiber to every municipality in the country – all 1,200 of them. Fiber is the best solution – hyper reliable (Forget that fear of gravity), high bandwidth, relatively low power, and low latency.
Fiber-to-the-municipality solves the urban connectivity problem. Most of Colombia’s municipalities are pretty small and their so-called ‘urban centers would be considered towns or villages elsewhere. Traditional telecom operators have easier places to make money.
Admittedly this is an easier problem than bringing Internet-to-the-shepherd on their distant mountaintop (Checking out the spot market for sheep’s wool? Or checking out that new funny sheep video on Facebook? And picking up a pair of digital sheep sheers on Amazon at the same time. Wait. Do they have a credit or debit card? Hard to make deliveries. Maybe not.).
But the private operator of the backbone has struggled to get utilization and so revenues up to meet the expectations of its heavily government-subsidized business plan.
The issue is at the retail level. The government expected either the traditional operators would step in – they did not – or local entrepreneurs would take up the opportunity – nope. There is a thought that the problem is lack of entrepreneurial spirit in rural communities, but the strong suspicion is that the problem is lack of demand.
In short the problem is not technological: it is human / marketing.
Airships will not solve that.
(Title reference: In my earlier tweet I referenced the old teen book – from my youth – Tom Swift and His Flying Lab. But then this old Max Webster song popped into my head and, just like when it was released back in the 70s I could not get it out of my head. Maybe if you weren’t of a certain age and living in Western Ontario Max Webster is not on your list. Kim Mitchell? Maybe not. Check out the links. And sorry Tom.)
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