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GBI Tech Series
Bringing Telecommunications
to the Rural Edge
November 17, 2011
2
www.GBIportal.net
Low-energy, Low-cost Wireless Communications
for Remote Communities
November 2011
Identification of the Remote Communities Market and its Size
• It is estimated that there are over 5 Billion mobile subscribers in the world today.
• Further more it is estimated that there are more subscribers in the developing world than there are in the developed world.
• It is estimated that the number of subscribers will exceed 6 Billion by 2014. For this to happen operators will have to deploy services in more remote and sparsely populated areas and face the following challenges
• Lack of grid based power
• Lack of Copper, Microwave or Fiber backhaul
• Current business cases do not apply.
Identification of the Remote Communities Market and its Size
• The GSM Association estimates that 75,000 new off grid mobile communications sites will be built per year in developing countries to address this growth.
• The World Bank estimates that 3 out of every four people in the developing world live in rural areas. That’s 2.1 Billion people.
• Therefore operators are going to have to find innovative and cost effective ways to connect these billions of rural inhabitants.
“Extending those networks to poor rural areas proves to be difficult for operators in terms of business rationale and cost justification”
Al Hammond and Loretta Michael HMS Wireless, Innovations, published by MIT Press.
Remote CommunitiesThe Key Challenges
• A combination of competition between the equipment vendors, government subsidies and initiatives such as the GSMA’s ultra low cost handsets have combined to drive down the network and handset cost for service providers but site, backhaul and power costs remain high.
• Non of the above initiatives address the operational costs that operators face when deploying sites in remote communities.
“Leading vendors have struggled to provide operators with a solution, which addresses the required ROI. As a result, it is estimated that almost 1,000,000 remote communities remain outside the world's telecommunications network” Ericsson
Remote CommunitiesSatellite Backhaul
• While the price of network equipment and terminals has fallen steadily since the introduction of GSM networks 1991, the transmission costs have not tracked these same deflationary trends.
• It is now estimated that anything from 15% to 80% of the total cost of ownership of a BTS relates to transmission costs.
• It is also estimated that a large proportion of this transmission cost is as a result of traffic that is local. i.e. traffic that is between subscribers on the same BTS or adjacent BTS’.
• Industry estimates for this local traffic is as high as 70% to 80%.
Remote CommunitiesSatellite Backhaul
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
90 91 92 93 94 95 96 97 98 99 00 01 02
Ku-band
C-band
DVB-RCS
Source: www.comsys.co.uk
VSAT Terminal Pricing Trends
Remote CommunitiesPower
• The other major OPEX challenge for remote sites is power.
• Almost all remote sites are off grid and therefore connections if available are prohibitively expensive ($100K).
• Alternative power solutions are the only option. These fall into the following categories:
• Diesel Generators
• Solar Power
• Wind Turbines
• Hybrid Solutions
• A regular GSM base station requires anywhere between 600 and 1800 Watts of power.
Remote CommunitiesPower
• Generators are not a viable option due to:• The logistics and cost of refueling the generators
• Potential theft of the generator
• Theft of the Diesel fuel
• Solar Power is the best solution but can prove expensive due to the cost of the batteries if the Base Station power requirements are not optimized.
• The cost of Solar panels is continuing to fall.
• However the largest cost of a solar installation is the battery backup required for night time or days where there is no or little sun.
Remote CommunitiesThe Site
• The CAPEX cost for the site is also a key consideration
• Standard Base Stations towers can be cost prohibitive in remote communities due to the construction costs.
• All of the tower materials have to be transported to the remote site.
• Tall towers require large amounts of concrete for the foundations.
• In many remote areas concrete becomes solid during transportation due to the humidity.
• Out door base stations are a necessity as shelters are not required.
• The site must be secure to stop the theft of any equipment. But this is less likely with solar power and outdoor base stations.
OPEX barriers for operators in remote communities
70% local calls = lower cost & superior voice quality
Wireless +
Internet
80% lesssatellite backhaul
Reliable off-grid solar power
Up to 50% lower operating cost
Remote Communities Solution
Low capital cost & low operating cost solution
Traditional model New solution
Small, rapidly deployable, passively cooled, low-cost, solar powered
Remote Communities Solution
large tower structure, air-con, expensive, diesel powered
• Local Connectivity• Keep payload local to site and/or
clusters of sites• Average backhaul bandwidth reduced
50%, with improved call quality
• Backhaul Optimisation• Low rate Codec, Optimised IP• 50% savings over SCPC
• Data Optimization• Condensed Core Network Elements at
the Edge, e.g. SGSN/GGSN• Enables implementation of standard
and innovative IP Optimisation
Operating Expense
• On-demand Power Control• Leverage “sleep mode” for VSAT• Lower power requirements
• Power Monitoring & Adaptation • Unique monitoring of power supply• Allows optimal dimensioning of solar
systems
• Traffic Dependent Power Control• Intelligent power amplifier
management• Lower power consumption
• Smaller lower-cost VSAT• Required for lower bandwidth
Capital Cost
Key Features of a remote communities solution
Tier 1 MNO Monthly Remote Community Revenue Summary*
$-
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
Monthly Voice Revenue Monthly SMS Revenue
Average Monthly Voice Revenue per Site: USD$ 2,642
Average Monthly SMS Revenue per Site: USD$ 812
* Actual monthly revenue data from Tier 1 MNO Remote Community deployments
Thank you
For further information please contact:
Ian Walter
t: +1 408 904 0327
www.altobridge.com
The broad applicability of
LCLP Telecoms Solutions
Eric White
INTEGRA LLC
17 November 2011
1. Legal/Regulatory/Competitiveness Consulting
i. Lowers operational and capital costs to competitive firms
while ensuring competition benefits consumer prices.
2. Universal Service Funds (USFs)
i. Smart Subsidies of Capital Costs (CAPEX) for
projects/infrastructure that will be self-sustaining
(Revenues>OPEX)
3. Low-Cost/Low-Power Base Station Technology
i. To reach the poorest and most remote populations (where
OPEX would be > Revenues with standard infrastructure)
ii. Can be deployed in conjunction with USFs.
19
The Three Tools of Telecoms Access TA
For different locations – ranked from most to least
accessible
LCLP solutions connect the most remote
locations!!
The Benefits of Connectivity
Connectivity
Economic
GrowthDevelopment
Better
Service
Delivery
Social
Betterment
The Economic Benefits of Connectivity
Controlling for all else,
access to voice and
broadband is associated
with big increase in GDP
(10% to 1%)
How ICT causes economic growth in rural
areas
• Lowers search costs and transaction costs, making
labor more productive.
• Increases the rate of social learning (better workers =
increased human capital)
• Reduces risk (increasing investment)
Income = f(productivity, human capital,
investment)
How ICT increases rural productivity
1. Voice, the killer app
2. Market information
systems
1. Secure monetary
transactions
Lowers
Search Costs
Lowers
Transaction Costs
How ICT improves rural human capital
Farm Extension Services
• Disease Identification
(Grameen AppLab
“Community Knowledge
Worker” Program)
• Google SMS: Farmer’s
Friend
Increases
Social Learning
How telecoms access increases investment
in rural areas
Reduces Risk
• Forward Contracts
• Input Verification
• Warehouse receipts
• M-Insurance
These are just a few of the HUNDREDS of mobile
products that improve economic growth in rural
areas
Telecoms Solutions for Health
• Health Systems
Strengthening
• Outbreak reporting
• Behavior Change
Communication
• Telemedicine
Telecoms Solutions for Education
• LCLP Base Stations can
connect schools
• Teacher attendance
monitoring
• Teacher payments
• Educational games
• Literacy improvement
Photo credit: Project ABC
USAID contracting vehicles
ready for this work
• Has a mandate to work with telecoms operators and
LCLP vendors to facilitate deployment of these
technologies.
• Offers a valuable online resource, www.GBIportal.net
that features articles about mobile interventions in
health, education, and 6 other sectors that can be
useful guides in crafting your programs.
• Can offer tailored consulting to Missions and Bureaus
on mobile for development programs.
Global Broadband and Innovations (GBI)
Points of Contact
Joe Duncan
GBI Program Manager, USAID
Eric White
Managing Associate, INTEGRA LLC
