Re: [gaia] [hrpc] Fibre Feudalism

[Steve Song <[e-mail]>]

In South Africa, universal service funds are being used to buy
set-top-boxes to facilitate the switchover to digital terrestrial
television broadcasting.

https://www.itweb.co.za/content/G98Yd7LxOPj7X2PD

In Mozambique,  universal service funds were used to fund the construction
of 103 mobile base stations of which 77 are non-functional today.

Regards... Steve



On Wed, 24 Oct 2018 at 09:23, Mallory Knodel <[e-mail]> wrote:

> The USF in Kenya hit the front pages when it announced it would
> (finally) spend its money (heretofore it is not clear if or how the
> money was ever spent) on a rural connectivity project at $850k. Buried
> in the text of the article it was noted that $10m would go to a
> cybersecurity initiative of the President's office.
>
>
> https://www.businessdailyafrica.com/economy/CA-s-Sh85m-plan-to-link-remote-areas-with-mobile-voice/3946234-4319204-gbsfna/index.html
>
> It would be really interesting to gather these unfortunate cases, as
> Carlos suggests, but its a moving target.
>
> -Mallory
>
> On 24/10/2018 11:17, Arzak Khan wrote:
> > The utilization of USF funds has been an issue in Pakistan where
> > Ministry of IT and Telecoms has used the fund for building cricket
> > stadiums, distributing smartphones to government employees and many
> > other projects which has not impacted greatly on provisioning of
> > broadband services in most of rural Pakistan. Building out fiber
> > networks still remain a challenge and limited to few players only
> > without promoting any competition.
> >
> >
> > Arzak
> >
> > ------------------------------------------------------------------------
> > *From:* hrpc <[e-mail]> on behalf of Kurtis Heimerl
> > <[e-mail]>
> > *Sent:* Monday, October 22, 2018 6:44 AM
> > *To:* Carlos Rey-Moreno
> > *Cc:* gaia; vint=[e-mail]; Steve Song; [e-mail];
> > Leandro Navarro
> > *Subject:* Re: [hrpc] [gaia] Fibre Feudalism
> >
> > I thought it worth noting that some of my experiences have been
> > different than Carlos's; for example in an unnamed central asian country
> > the regulator mentioned that the USF distribution is set in policy and
> > they must, by law, return the money to the telecoms. Even in those with
> > the ability to put the money elsewhere, there were occasionally
> > structures that push the regulator to fund "related" but non-competitive
> > services like computer or internet literacy. Tricky space with a lot of
> > moving pieces.
> >
> > On Sun, Oct 21, 2018 at 10:58 PM Carlos Rey-Moreno
> > <carlos.reymoreno@gmail..com <mailto:[e-mail]>> wrote:
> >
> >     Hi all, interesting debate indeed, and happy to join a further call
> >     on this, or even work in a document where we can consolidate these
> >     discussions.
> >
> >     After having engaged with several regulators, and managers/officials
> >     from universal access agencies in Africa this year, my main take
> >     away is that they keep on using USO to incentivize incumbents to go
> >     to rural areas because that's the only way they know. Once they are
> >     presented with alternative models like the ones mentioned by
> >     Leandro, they are very open, in principle, to explore them. They are
> >     the ones who know how ineffective the current models are, but in
> >     most cases they are, as Steve points out, constrained by frameworks
> >     that only allow to use the fund to those who contribute to it.
> >
> >     I think, at least in Africa, there is a very interesting opportunity
> >     to work together with USAF managers/officials to discuss an
> >     potentially implement innovative ways of using them. Consolidating
> >     the knowledge in this discussion and others in a working document,
> >     with the different advocates in the region speaking proposing the
> >     same thing, could contribute a lot in this direction.
> >
> >     best,
> >
> >     carlos
> >
> >     On Sun, 21 Oct 2018 at 19:29, Leandro Navarro <[e-mail]
> >     <mailto:[e-mail]>> wrote:
> >
> >         Agreed, but the sad thing is that practice (country policy) goes
> >         in the opposite way in the few cases I know where USO is a form
> >         of subsidy or tax deduction to benefit the incumbent only,
> >         before a legal monopoly. The typical government argument is that
> >         USO is paid by industry, that reflects this privilege or new
> >         form of monopoly/subsidy in favour of the incumbent only
> >         (everyone pays the king operator in the feudal metaphor). In
> >         consequence, the incumbent does the minimum required to justify
> >         receiving the funds to preserve the pool of unconnected as a
> >         source of future USO income (the serfs of the feudal system).
> >
> >         For example, one fibre community network but can be any
> >         alternative operator to the incumbent, fears the effect of
> >         that: https://www.ispreview.co.
> .uk/index.php/2017/11/b4rn-fear-10mbps-uk-broadband-uso-may-hamper-rural-ftth-rollout.html
> >         <
> https://www.ispreview.co.uk/index.php/2017/11/b4rn-fear-10mbps-uk-broadband-uso-may-hamper-rural-ftth-rollout.html
> >
> >
> >         That’s why USO as implemented can be counter effective.
> >         Alternative models of distribution, radically different, are
> >         needed, where all the funds are not given to a single operator
> >         (and deter investment by others), but to every citizen that
> >         qualifies (to free the serfs). Bottom-up (people centred)
> >         instead of top-down (incumbent centred). Something along those
> >         lines may contribute to increase alternatives and not just be
> >         used to mainly reinforce the de-facto monopoly of largest
> >         operators (for example: https://b4rn.org.uk/b4rn-service/gbvs/ )
> >         Otherwise USO policies are mainly a form of public subsidy, a
> >         form of monopoly, to reinforce the incumbent, with the excuse of
> >         the underserved and unconnected.
> >
> >         Leandro.
> >
> >>         On 21 Oct 2018, at 18:15, Vint Cerf
> >>         <vint=[e-mail]
> >>         <mailto:vint=[e-mail]>> wrote:
> >>
> >>         Steve is spot on.
> >>         V
> >>
> >>         On Sun, Oct 21, 2018, 09:53 Steve Song <[e-mail]
> >>         <mailto:[e-mail]>> wrote:
> >>
> >>             Hi Amelia, Sonia,
> >>
> >>             I agree this is a very interesting and timely debate and I
> >>             would be happy to participate in a discussion on this.
> >>
> >>             Universal service funds that involve (or in many cases are
> >>             legally restricted to) giving money back to the incumbents
> >>             to build out infrastructure has proven (over and over and
> >>             over again) to be a terrible idea.  I hope we can agree
> >>             that we should stop doing that.  For me the issue is about
> >>             power and control and the way it is used to impede
> >>             competition.  The cost of technology has plummeted in both
> >>             fibre and wireless technologies.  In theory that should
> >>             have been a boon for competition but high spectrum auction
> >>             fees and licenses along with exclusive control of fibre
> >>             backbones has created an almost impenetrable barrier to
> >>             market entry.  Any government intervention in universal
> >>             service should obliged to address the issue of market
> >>             permeability as well as ownership of and access to core
> >>             networks.
> >>
> >>             Cheers... Steve
> >>
> >>             On Sat, 20 Oct 2018 at 07:07, Sonia Jorge
> >>             <[e-mail]
> >>             <mailto:[e-mail]>> wrote:
> >>
> >>                 Hi All,
> >>
> >>                 Interesting discussion here. One that might warrant a
> >>                 webinar/conference call among interested people?
> >>                 Steve, what do you think? I would be happy to join a
> >>                 stimulating discussion on the topic, starting with
> >>                 your blog and the Access Model.
> >>
> >>                 Amelia, can you point me to some evidence or a paper
> >>                 (anything you may have) that shows that relationship
> >>                 between USO and quality of infrastructure? I find that
> >>                 very difficult to believe but open to be proven wrong.
> >>
> >>                 Something important to keep in mind is that countries
> >>                 where USO have been more instrumental are also
> >>                 countries that have traditionally been poorer and
> >>                 behind in terms of infrastructure development; this is
> >>                 certainly the case in some Southern European countries
> >>                 and maybe Eastern European ones as well. So the level
> >>                 of economic development overall is a key variable.
> >>
> >>                 As for Africa and/or infrastructure investments, I
> >>                 could share a lot here, but for now let me call your
> >>                 attention to some reports we produced and that can add
> >>                 to the discussion.
> >>                 - A4AI’s annual Affordability
> >>                 Report:
> https://a4ai.org/affordability-report/report/2017/.
> >>                 Note that the 2018 report will be launched and
> >>                 published on Tuesday and addresses key questions
> >>                 relevant to this discussion, specially on costs
> >>                 associated with infrastructure investment
> >>                 - a recent blog on infrastructure costs and
> >>                 challenges: https://a4ai.
> .org/affordable-internet-access-the-cost-challenge/
> >>                 <
> https://a4ai.org/affordable-internet-access-the-cost-challenge/>
> >>                 - For those interested in USFs in Africa,
> >>                 see
> https://a4ai.org/universal-service-and-access-funds-an-untapped-resource-to-close-the-gender-digital-divide/
> >>
> >>                 Best,
> >>                 Sonia Jorge
> >>                 Executive Director, A4AI
> >>                 Head of Digital Inclusion, Web Foundation
> >>                 1-617-905-7819
> >>
> >>                 On Oct 20, 2018, at 05:33, Amelia Andersdotter
> >>                 <amelia@article19..org <mailto:[e-mail]>>
> >>                 wrote:
> >>
> >>>                 Hi all,
> >>>
> >>>                 It might be helpful to know that EU countries where
> >>>                 Universal Service
> >>>                 Obligations have been extensively used and applied,
> >>>                 also typically have
> >>>                 worse infrastructure than EU countries where USO
> >>>                 wasn't well applied.
> >>>                 Applying USO means you put the government in a
> >>>                 position where it faces
> >>>                 off with the service provider under USO in a
> >>>                 negotiation. The service
> >>>                 provider has information advantage and typically a
> >>>                 better relationship
> >>>                 to its consumers than the government has to its
> >>>                 citizens (so a
> >>>                 communications advantage too). I lack experience of
> >>>                 the African markets
> >>>                 and their regulators, but in broad strokes those are
> >>>                 the issues faced in
> >>>                 various European jurisdictions with USO and I'm
> >>>                 assuming similar
> >>>                 difficulties would arise in the African setting. This
> >>>                 is a bit
> >>>                 theoretical, and I'm just curious how to avoid these
> >>>                 information
> >>>                 asymmetries?
> >>>
> >>>                 As it is described by Steven, the current feudalism
> >>>                 (operators A, B and
> >>>                 C all collaborate as soon as they own physical fibre
> >>>                 networks) also
> >>>                 incentivises many actors to get into the
> >>>                 infrastructure market. That's
> >>>                 fundamentally a good thing: it means not all the
> >>>                 last-mile is owned by a
> >>>                 few big actors who need to be regulated by a
> >>>                 regulator who is
> >>>                 fundamentally at a disadvantage compared to the big
> >>>                 actors. It's the
> >>>                 main criticism targetting the Local Loop Unbundling
> >>>                 reform of 1999 in
> >>>                 the EU as well - challengers don't invest enough in
> >>>                 last-mile
> >>>                 infrastructure (except in those EU markets where many
> >>>                 different actors
> >>>                 have had regulatory incentives to build their own
> >>>                 networks, or where
> >>>                 there has been purposeful public investment in
> >>>                 last-mile). Or am I
> >>>                 misunderstanding something?
> >>>
> >>>                 best regards,
> >>>
> >>>                 Amelia
> >>>
> >>>
> >>>
> >>>                 On 2018-10-04 20:52, Steve Song wrote:
> >>>>                 Hi Mallory,
> >>>>
> >>>>                 Thanks for that!  I think you are on exactly the
> >>>>                 right track in terms
> >>>>                 of thinking about economic models.  Thanks to Erick
> >>>>                 Huerta of
> >>>>                 Rhizomatica, I am very taken with the thinking of
> >>>>                 French economic
> >>>>                 historian, Fernand Braudel..  Braudel argues that
> >>>>                 the world has three
> >>>>                 economies not one.  A global economy which is the
> >>>>                 well-known
> >>>>                 capitalist economic model where monopoly is the
> >>>>                 perfect end-game in
> >>>>                 theory for every player.  Google, Colgate,
> >>>>                 Coca-Cola, all the usual
> >>>>                 suspects form part of this economy.  The second
> >>>>                 economy is the Local
> >>>>                 Economy where services are specific to the
> >>>>                 city/community where you
> >>>>                 live.  This might be your local butcher, baker,
> >>>>                 plumbers or even
> >>>>                 larger service provider which offers services that
> >>>>                 grow out of local
> >>>>                 demand and which serve local needs in more unique
> >>>>                 ways than the Global
> >>>>                 Economy.  The third economy is the Subsistence
> >>>>                 economy where market
> >>>>                 forces may not operate because there is not
> >>>>                 sufficient traditional
> >>>>                 capital to make it work.  This is the world of the
> >>>>                 informal economy
> >>>>                 with barters, cooperatives, community initiatives
> >>>>                 that directly
> >>>>                 contribute to the overall economy but are largely
> >>>>                 unmeasured by
> >>>>                 traditional statistics.  And woven among these are
> >>>>                 both commercial and
> >>>>                 commons models, which can operate with varying
> >>>>                 success at the
> >>>>                 different levels.
> >>>>
> >>>>                 When viewed through this lens, it is easy to see how
> >>>>                 regulation has
> >>>>                 only enabled the global economy in telecommunication
> >>>>                 and that there is
> >>>>                 a need for enabling regulations to nurture telecom
> >>>>                 initiatives in the
> >>>>                 Local and Subsistence economies.
> >>>>
> >>>>                 For me this also highlights a key flaw in models
> >>>>                 like the World Bank's
> >>>>                 Access Gap model
> >>>>                 <
> http://blogs.worldbank.org/ic4d/the-gaps-model-and-universal-access>. It
> >>>>                 is not so much that the model is wrong, it is just
> >>>>                 one-dimensional;
> >>>>                 assuming that successful global capitalism is the
> >>>>                 best of all possible
> >>>>                 outcomes.
> >>>>
> >>>>                 Writing more about this shortly.
> >>>>
> >>>>                 Cheers... Steve
> >>>>
> >>>>
> >>>>                 On Thu, 4 Oct 2018 at 10:57, Mallory Knodel
> >>>>                 <[e-mail] <mailto:[e-mail]>
> >>>>                 <mailto:[e-mail]>> wrote:
> >>>>
> >>>>                    Hi Steve,
> >>>>
> >>>>                    Thanks for sharing. I read it last night and I
> >>>>                 really enjoyed it.. I
> >>>>                    think the metaphor is solid economically. And
> >>>>                 politically, well, that
> >>>>                    could be another post in and of itself..
> >>>>
> >>>>                    The agrarian commons would of course be ideal,
> >>>>                 but what we have is a
> >>>>                    sort of old-world economic structure that
> >>>>                 politically controls and
> >>>>                    profits from (what should be) the commons. This
> >>>>                 sets you up nicely to
> >>>>                    call for modern economic models ranging from
> >>>>                 squarely capitalist to
> >>>>                    socialist, and even (back to) the commons!
> >>>>
> >>>>                    I'm CCing HRPC because it might be of interest to
> >>>>                 those who have
> >>>>                    raised
> >>>>                    issues of centralisation on the list in the past.
> >>>>
> >>>>                    -Mallory
> >>>>
> >>>>                    On 04/10/2018 15:30, Steve Song wrote:
> >>>>>                 Hi all,
> >>>>>
> >>>>>                 This is a reflection on the current state of
> >>>>>                 terrestrial fibre
> >>>>>                 infrastructure in Sub-Saharan Africa (but I think
> >>>>>                 applies just about
> >>>>>                 everywhere).
> >>>>>
> >>>>>
> https://manypossibilities.net/2018/10/fibre-feudalism/
> >>>>>
> >>>>>                 Curious to know how apt you feel the metaphor is or
> >>>>>                 any other
> >>>>                    reactions
> >>>>>                 you may have.
> >>>>>
> >>>>>                 Thanks..... Steve Song
> >>>>>
> >>>>>
> >>>>>                 _______________________________________________
> >>>>>                 gaia mailing list
> >>>>>                 [e-mail] <mailto:[e-mail]>
> >>>>>                 <mailto:[e-mail]>
> >>>>>                 https://www.irtf.org/mailman/listinfo/gaia
> >>>>>
> >>>>
> >>>>
> >>>>                    --
> >>>>                    Mallory Knodel
> >>>>                    Head of Digital :: article19.org
> >>>>                 <http://article19.org/> <http://article19.org
> >>>>                 <http://article19.org/>>
> >>>>                    gpg fingerprint :: E3EB 63E0 65A3 B240 BCD9  B071
> >>>>                 0C32 A271 BD3C C780
> >>>>
> >>>>                    _______________________________________________
> >>>>                    gaia mailing list
> >>>>                    [e-mail] <mailto:[e-mail]>
> >>>>                 <mailto:gaia@irtf..org <mailto:[e-mail]>>
> >>>>                    https://www.irtf.org/mailman/listinfo/gaia
> >>>>
> >>>>
> >>>>
> >>>>                 --
> >>>>                 [phone]
> >>>>                 [e-mail] <mailto:[e-mail]>
> >>>>                 <mailto:[e-mail]>
> >>>>                 http://nsrc..org <http://nsrc..org/>
> >>>>                 <http://nsrc.org <http://nsrc.org/>>
> >>>>
> >>>>
> >>>>                 _______________________________________________
> >>>>                 hrpc mailing list
> >>>>                 [e-mail] <mailto:[e-mail]>
> >>>>                 https://www.irtf.org/mailman/listinfo/hrpc
> >>>
> >>>
> >>>                 --
> >>>                 Amelia Andersdotter
> >>>                 Technical Consultant, Digital Programme
> >>>
> >>>                 ARTICLE19
> >>>                 www.article19.org <http://www.article19.org/>
> >>>
> >>>                 PGP: 3D5D B6CA B852 B988 055A 6A6F FEF1 C294 B4E8 0B55
> >>>
> >>>
> >>>                 _______________________________________________
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> >>>                 https://www.irtf.org/mailman/listinfo/gaia
> >>                 _______________________________________________
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> >>
> >>
> >>
> >>             --
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> >>
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> >>
> >>         _______________________________________________
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> >>         https://www.irtf.org/mailman/listinfo/gaia
> >
> >         --
> >         Leandro Navarro
> >         http://people.ac.upc.edu/leandro http://dsg..ac.upc.edu
> >         <http://dsg.ac.upc.edu>
> >
> >         _______________________________________________
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> >         [e-mail] <mailto:[e-mail]>
> >         https://www.irtf.org/mailman/listinfo/gaia
> >
> >
> >
> >     --
> >     Carlos Rey-Moreno, PhD
> >     "Community and Local Access Networks" Project Coordinator
> >     Association for Progressive Communications
> >
> https://www.apc.org/en/project/local-access-networks-can-unconnected-connect-themselves
> >     <https://www.apc.
> .org/en/project/local-access-networks-can-unconnected-connect-themselves>
> >     Cel: [phone]
> >     Skype: carlos.reymoreno Twitter: Creym
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> >
> >
> >
> > --
> > Public Key: https://flowcrypt.com/pub/[e-mail]
> >
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> >
>
>
> --
> Mallory Knodel
> Head of Digital :: article19.org
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>
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