How Nigeria’s slow Internet speed affects economic growth

No Comments » July 11th, 2017 posted by // Categories: ICT Industry Development Project


How Nigeria’s slow Internet speed affects economic growth

By Adeyemi Adepetun   |   11 July 2017   |   4:21 am

President, Association of Telecommunications Companies of Nigeria (ATCON), Olusola Teniola, believed that with increases in Internet speed there is a corresponding increase in efficiency and productivity in the workplace where ICT is embedded.

• Lack of fibre infrastructure stalls expansion of services

Investigations have shown that the high cost, lack of access, and slow Internet connectivity in Nigeria, remain a major concern in the telecommunications sector, and require urgent attention in the country.

Though, there was a 41.5 per cent upsurge in data usage in quarter one (Q1 2017), from 22,019.66Terabytes (TB) in February to 31,160.00TB in April, subscriptions to the Internet has, however, continued to fluctuate. Worst still Nigeria’s Internet speed is so slow; ranking 114 out of 143 countries surveyed in May, by Akamai, a global content delivery platform.

Lack of access, and slow Internet connectivity, apart from hampering economic growth and job creation, also inhibit Nigeria’s move to keep up with global trends on innovations and creativity.

Indeed, despite the revolution in Nigeria’s $68 billion telecoms sector, about 40 million people residing in some 207 communities still don’t have access to basic telecommunications services.

The World Bank identified broadband Internet connectivity as a key catalyst for economic growth with every 10 per cent increase in connectivity enabling a 1.38 per cent growth in Gross Domestic Product (GDP).

As such, with Internet speed in the country put at 3.9Mbps, against global standard of 7.2Mbps, Nigeria still has a lot of catching-up to do. Countries including Kenya, South Africa, and Morocco with 12.2Mbp, 6.7Mbps, and 5.2Mbps respectively, lead Africa, with Singapore maintaining a global lead with 184.5 Mbps.

Internet Speed is the performance of a connection based on the number of bytes per second that data travels from the user’s device to the Internet (upload) and to download. Depending on the type of connection, the speed differs dramatically; the download rate is higher than the upload, because a short request to the website (upload) results in a much larger download of Web pages, images and videos.

Explaining how Internet speed affects the economy, the Chief Executive Officer, Spectranet, David Venn, said if a subscriber is located in an area with access to faster technologies such as fibre or 4G, he will have a fast Internet access at home and business.

“For instance, the average Internet speed in Nigeria might be 3.9Mbps but, if you are in Lagos, you could choose to buy a 4G connection and experience 10 to 20Mbps. If faster speeds are available, you do not need to worry about the average speed, hence it should not be a cause for slowing down economic activity. However, if you live or work in an area without fast access, then, for certain types of business, this would be an impediment to growth. Note also that if you do not have a fast access available your average speed is likely to be considerably worse than the nation’s average, because that’s the way averages work. This is the ‘Digital Divide’,” he said.

But the President, Association of Telecommunications Companies of Nigeria (ATCON), Olusola Teniola, believed that with increases in Internet speed there is a corresponding increase in efficiency and productivity in the work place where ICT is embedded.

He argued that with interconnected systems and collaborative working relationships in place, it is important that ideas, innovation and development are harnessed in a speedily manner, not only to secure the intellectual patent rights, but to fully leverage the multiplier effect that digitalisation brings to the value chain that may already be in place. “So fast high speed Internet supports leading edge applications, and creates the momentum for a futuristic intelligent working environment.”

Commenting on the Akamai’s report, Venn said the speed is the average speed across many thousands of speed tests conducted over a period of time. According to him, in developed broadband markets, people could do speed tests from home on a cable or fibre connection, from their office on a high speed connection, or on their mobile phone using either 2G, 3G or 4G. Each of these technologies would give different results, “but Fibre should be the fastest.”

He disclosed that the majority of Internet users in Nigeria use a 3G phone connection, which is one of the slowest connections. “Because this is currently the predominant technology, the average reported for Nigeria would be blended down when compared with more developed markets.”

Explaining Kenya’s highest rating in Africa, Venn revealed that the country has a wider spread of 4G services than Nigeria – it has Cable TV (and Internet) to the home in many residential areas, and also Telcom Kenya still has an active fixed line network.
Similarly, Teniola admitted that Kenya demonstrates the potential that a country can achieve when there is a pervasive and ubiquitous backbone fibre network. He added that for Nigeria to measure up there is a need for a National Backbone Network (NBN), built on optic fibre technology to achieve greater speeds at affordable rate per Mbps.

Furthermore, he said: “government needs to create the right environment that allows the proper funding, creative capital and support and protects investments already made in this sector. So that further investments can be brought in to fund network capacity increases, IXPN – to reduce latency and finally to provide fair access to available spectrum needed to enable high speed broadband type services.”

Also commenting, the CEO of nTel, Kamar Abass, agreed that a faster connection delivers a better customer experience, and “this is what all operators do strive to deliver. However, it is worth recognising that the provision of comprehensive coverage (together with reasonable pricing), and in this way, facilitating the ‘always on’ connection requirement is just as important, if not more so, than high Internet speeds.”

Abass noted that Nigeria has over 50 million mobile broadband customers, counting both 3G and 4G, in addition to another 90 million Internet active subscribers using 2G, 3G or 4G technology. “However, there is still much work to be done and as networks gear up their 4G investments, I am confident that it will get done,” he added.

Speaking recently, the Executive Vice Chairman, Nigerian Communications Commission (NCC), Prof. Umar Danbatta, attributed poor quality of service and slow Internet connections in the country to neglect of fixed telecommunications services, which have put tremendous pressure on mobile wireless services.

Danbatta said to reduce pressure on the existing lower microwave frequency bands and increase broadband access across Nigeria, the NCC has set aside the 38 GHz and 42 GHz bands, adding that both bands were suitable for short hop and point-to-point terrestrial links. These also support 3G/4G/LTE backhaul, and a high degree of frequency reuse due to the high directivity of their antennas.


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