Are you ready for the country?

Posted on Friday, March 15, 2019

The GSMA recently reported that a multi-party group of UK politicians was pressuring regulator Ofcom to “assure consumers and rural people that improvements are being made to 4G availability”. If rural coverage is considered an issue in one of the world’s most advanced telecom markets, what is the situation in Latin America?

Well, I gotta tell the story before it’s time to go

The article mentions a number of All-Party Parliamentary Group on Rural Business concerns, centered around the facts that rural coverage and network performance is poorer than urban, despite the obvious economic benefits of better broadband for non-urban communities.

“Ofcom has acknowledged across several reports and especially in its guidance to government that mobile operators are reluctant to build masts in rural areas due to significant costs,” the GSMA quoted from the group’s letter.

Which is the ‘bottom-line’. Everyone, even the operators, would love to have perfect rural coverage in 4G (or even 3G). The people who run operators are (with some exceptions) believe in what they are doing; they believe that better communications serves mankind.

They understand that better broadband has a multiplier effect on economic growth and development. Furthermore, this multiplier is even greater the further down the economic ladder one is. There is always a gradient in economic variables like average income between urban and rural areas (except perhaps for gated communities but we are not talking about them and they are hardly ‘the country’). The steeper the gradient between two areas, the greater the impact of adding telecom infrastructure to the less favored region[i].

But ‘the country’ we are supposed to be getting ready for is a whole lot of empty space with a small number of people, not even a lot animals (my comments last week about connected sheep in the Falklands / Malvinas not withstanding). The city of Bogotá (where I live) has a population density of 4,310 people per square kilometer. The population density of Colombia as a whole is 44 people per square kilometer. You do the math for the density of the rest of the country, even including other major cities.

For the largely rural Colombian state of Casanare, which has a city (Yopal) and is important for both agriculture and oil production, the density is 7.7 people per square kilometer, 1/6th of the national average. Excluding Yopal, the density is 5.4 people per square kilometer or slightly more one standard Colombian family per km2. A square kilometer is the area served by a base station with an effective radius of 560 meters.

For 2G and even 3G, the economics made sense for rural coverage, especially as consumers started to discover the benefits of communications – voice, text, Twitter, Facebook! But 3G is now no longer considered ‘broadband’ (those instant-start cat videos in Facebook are painful) and the ‘broadband experience’ in 4G degrades the further away you are from a tower. At least in the unbroken prairie of Casanare, line-of-sight will not be an issue, but if we assume ‘decent’ broadband service within a kilometer of the tower, that would only mean about 4 or 5 households as potential customers for a fixed wireless service.

Now let’s introduce the topic of multiple operators with multiple base stations competing for those 4 or 5 households.

This is Casanare, Colombia but I could have constructed similar arguments for regions of any country in the hemisphere, including Canada and the United States.

(If anyone from the All-Party Parliamentary Group on Rural Business happens to stumble across this blog, the population density of Casanare is about that of the Scottish Highlands – but fortunately for radio propagation, a lot flatter.)

Faced with the impossibility of this equation, governments adjust rural broadband objectives in Latin American countries to more achievable goals, like coverage in the urban center of the state capitals. You can get voice and text at home, but to get decent Internet performance you have to go into town.

Bottom-Line: No, we are not ‘ready for the country’ but I think there are some changes to the paradigm that would help.

The first is making broadband the equivalent of a ‘Sustainable Development Goal’ for middle-income countries like Colombia. If we treat this like ‘running water’ or ‘electricity’, we will come up with more creative solutions than we have today.

Public investment will almost certainly be required although if I would prefer that private companies run things. Despite the romantic attachment of some politicians to a past public service paradise that never existed, private companies will do a better job of building and operating even though they will not, rationally, invest much or any of their own money in rural broadband in the first place.

My other suggestion is that operators abandon their visceral rejection of shared networks. If the government is going to contribute or even pay for the investment, it should only pay once. Mexico’s ‘Red Compartida’ is the right idea but somehow we have to get over major operators’ reluctance to use these solutions.

Well, I gotta tell the story; I don’t know the reason why

Title reference: Continuing to riff off CSN&Y for some no-doubt deep psychological reason, Are you ready for the country? is a 1972 Neil Young song from the Harvest album. Harvest would top the charts for two weeks and become the year’s best-selling album but Are you ready for the country? was never released as a single. Waylon Jennings took it to number 7 on the Country charts in the US (number 3 in Canada) in 1976. Hank Williams Jr released a version in 2015 that only got to number 46 in the US. (The song refers to his more famous father, at least more famous outside of Monday Night Football fans.) The song is not one of Young’s more profound investigations of the human spirit but the title phrase (repeated nearly 20 times throughout the lyrics) is obviously relevant.

Are You Ready For The Country lyrics by Neil Young © Silver Fiddle Music

[i] The rather obvious question is what proof have I got of that assertion? Frankly, I have none. A telecom consulting company I used to work for once bid on a project to prove this for a major multinational operator. We lost the bid, probably because my undergraduate minor in economics was not considered to be as relevant as the PhDs that specialist economic-analysis firms promised would work on the project if they won. I later saw a copy of the final report (public version) and it was the same qualitative handwaving as always about the Brave New World! of telecommunications. I do not need a PhD to do that. My argument is purely mathematical so those without such interest can jump back to the main text. If we accept that the curve relating communications infrastructure to economic wealth is upward-sloping (more investment is better) then, adding the same amount of ‘stuff’ to a place where there is little today – like a rural community – has to have a larger proportional impact than adding it to a place where there is already a lot – like an urban area. Questions about elasticity or the proportional impact of a proportional change depend on the shape of the curve but I’ve already bored some of you into jumping to the latest gossip out of Real Madrid, not even going back to the main text, so I will stop. For those who soldier on, assuming the curve shows diminishing returns to scale (like most investment/output curves) then the elasticity is (by definition) higher where there is little investment today than in areas where there is already a lot.

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