THE RELATIONSHIP BETWEEN LOCAL CONTENT, INTERNET DEVELOPMENT AND ACCESS PRICES

Last Updated on Wednesday, 26 September 2012 07:09

A 2011 report published by the Internet Society (ISOC), the Organisation for Economic Co-operation and Development (OECD) and the United Nations Educational, Scientific and Cultural Organization (UNESCO).

http://www.internetsociety.org/localcontent

Reviewed by Dan McGarry

The phrase ‘interdisciplinary research’ is far too often code for ‘do not read’, implying a lack in all trades more than a mastery of one. This research report is a notable, worthwhile exception. It draws together expertise and genuinely useful data from technologists, economists and social scientists and still manages somehow to convey a coherent, intelligible and useful message.

That message is simple enough: “[T]here is a strong correlation between the development of network infrastructure and the growth of local content, even after controlling for economic and demographic factors.”

In layman’s terms: Investment in local internet capacity leads to more locally relevant content, which in turn tends to drive demand for local internet capacity. Improved local capacity leads to lower international internet costs (and therefore greater capacity). Follow-on benefits include improved functional literacy rates and lower costs in creating, storing and sharing locally relevant material.

One of the greatest benefits of this research is that it confirms in finite, measurable ways what many of us have long felt to be true. Internet development benefits from supply-side approaches, and more really is merrier where infrastructure is concerned. That said, there are several quite sobering graphs and charts which show in no uncertain terms the breadth of the disparity between developed and developing nations. Happily, the authors refrain from wallowing in the morality of the now-clichéd Digital Divide and focus on measuring the nature and effects of infrastructure investment in numerous economies in varying stages of development.

Here is one of the more interesting charts in the study:

Average prices for a monthly subscription

These are global numbers, of course; the disparity between prices Pacific islanders pay and those paid in the developed world is even greater. But it provides us with a couple of inescapable conclusions: first, no matter what we do, broadband infrastructure in the Pacific isn’t ever going to resemble what we see today in the developed world. There is simply no way we can affordably deploy fibre to every home, for example.

We have to conclude, therefore, that in addition to developing local content, we’ll also have to develop our own pool of planners and strategists. While data-rich reports like this offer us a great deal of guidance in general terms, they require translation into the Pacific’s unique context.

Ongoing regional efforts such as the joint South Pacific Community/University of the South Pacific ICT strategy are commendable and do provide high-level returns, but they’re often limited by a lack of engagement on the part of decision-makers and a low-information environment, which make it difficult to grab and hold people’s attention long enough to perform proper top-to-bottom planning.

This report’s simple messages might help to mitigate this attention deficit. Based on its findings, we can infer several clear, simple and eminently practical recommendations that are of immediate value to decision-makers across the Pacific. A few examples:

  • Given that the Pacific ‘last mile’ of connectivity is almost inevitably going to be completed using wireless technology, radio frequency spectrum management and allocation can be used to encourage maximum competition and therefore consumer uptake.
  • Internet Exchange Points (IXPs), where local carriers can transit traffic between themselves, have obvious economic and social benefits, because they enable low-cost, higher-bandwidth data flows between local residents and businesses. And this report indicates that increased uptake is good for telcos and internet service providers because it leads to increases in international traffic as well. In short, investing in the health of the market is good for the economic health of the players within it, too.
  • Local content, infrastructure development and access prices are interdependent. Collectively, they seem to form a ‘virtuous circle’ in which each one enhances the other. Pacific economies would therefore benefit from governments widening their focus beyond infrastructure development to include local content as a priority development area. E-Government programmes are an obvious starting point, with open data policies providing the quickest results.
  • ICT equipment is expensive, disproportionately so for Pacific islanders. Reducing tariff and tax revenues from these erstwhile luxury items is a simple, effective way of improving access. Likewise, encouraging ‘sideways’ labour mobility (i.e. easing employment restrictions for Pacific IT experts) could also reduce costs and improve efficiency in developing and delivering local content.

Non-technical technology research often suffers from the fact that IT is increasingly a commodity, a small-but-integral part of pretty much everything we do. But it’s not nearly as simple to manage, even in straight-up engineering terms, as a water or electrical power system, for example. It requires top-to-bottom engagement and expertise, and its innate complexity makes it easy to misjudge, especially for those whose expertise lies in different areas.

It’s a rare delight, therefore, to see a report that manages to retain its focus and clarity while still straddling IT, economics and social science. More the to the point, it’s one of those rare bits of research that is immediately useful. If you do nothing else, read the cover page, and take comfort that the findings listed there are backed by solid, well-researched data.


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