OCTOBER 2016

Last Mile
Connectivity
In Emerging Markets

Sponsored By
Contents
Last Mile Connectivity in Emerging Markets

3 Foreword: Last Mile Connectivity in Emerging Markets

James Barton - Editor, Developing Telecoms

5 Sponsors:
Operator Partner: MTN Nigeria
Silver Sponsor: Koonsys
Article Sponsor: Omoco

6 Interview: Emerging Markets Will Take a Fresh Approach

to Last Mile Connectivity
Ian Keene - Vice President, Research, Networking &
Communications Equipment, Gartner Research

11 Intelligent Planning for Optimisation of Last Mile

Connectivity
Krisztian Novak - Co-founder & Strategic Business
Development Director, Koonsys Radiocommunications

15 Interview: Tackling Last Mile Connectivity from an African

Perspective
Thecla Mbongue - Senior Telecoms Analyst, Middle East &
Africa, Ovum

17 Last Mile Rural Connectivity - Moving Beyond Traditional

Network Infrastructure
Tim Guest - Communications & Business Writer

21 Fibre - the Ultimate Last Mile, Now Showing Explosive

Growth
Stefan Stanislawski - Co-Founder, Ventura Team

25 Interview: Connecting Africa: Last Mile from an Operator’s

Perspective
Tolulope Williams - Senior Manager, Access, Transmission,
Planning & Optimisation, MTN Nigeria

w w w.developingtelecoms.com | October 2016

02
Foreword
James Barton, Editor, Developing Telecoms
James Barton - Developing Telecoms
The term ‘last mile’ has long been used
to describe the final hurdle of delivering
telecommunications services to end users,
and the challenges of delivering connectivity
from core network to final destination are so
well-known that the term has come to refer
to an entire raft of solutions aimed at doing
exactly that.
Practically speaking, network structures make it virtually
impossible to deliver the bandwidth available at a landing
site intact to a consumer’s home, often due to obsolete
technologies or an unworkable number of links. Last Mile
seeks to overcome this bottleneck, delivering connectivity
without compromise to areas that suffer from a dearth of
bandwidth.
These solutions are increasingly having a huge impact in
emerging markets, where they can be used to connect
remote rural communities with a business case that
makes sense for the operator. In addition, as traffic – and
particularly data usage – soars in densely populated cities,
solutions for increasing bandwidth availability are in high
demand. A further appeal for last mile connectivity in
emerging markets is the fact that developing countries are
typically unencumbered by outdated legacy architecture –
although this of course brings its own challenges in terms of
building out infrastructure in a cost effective way.
w w w.developingtelecoms.com | October 2016
03
This report focuses on the difficulties faced by operators
in emerging markets looking to deliver data bandwidth
cost effectively to challenging locations, including remote
communities and busy cities. While the challenges are
myriad, improvements in technology are increasingly
making the business case viable and allowing operators to
extend their reach to areas that just a few years ago would
have been logistically and financially unfeasible to connect.
We have enlisted the help of several experts in this field to
discuss the most appropriate and efficient technologies
for the various use cases of last mile connectivity, and it is
my pleasure to be able to offer our readers the insight of
major analyst firms Gartner, Ovum and Ventura Next AB.
In addition, I was privileged enough to interview Tolulope
Williams of pan-African operator group MTN to discuss
the firm’s approach to connectivity challenges across the
continent; I would like to extend my thanks to him along
with all of the contributors to this Special Report.
At Developing Telecoms, we aim to provide the greatest
degree of insight into the technologies that have the
greatest impact in emerging markets, and our series of
Special Reports are a key pillar of this mission. They are
made possible by our sponsors, and I would like to extend
my personal thanks to the sponsors of this report, Koonsys
and Omoco, both of which have contributed insightful
articles to the report.
w w w.developingtelecoms.com | October 2016
04
Sponsors

We are grateful to the following sponsors for

supporting this Special Report.

Koonsys
Koonsys is a premium supplier of Radio and Transmission
network optimisation and planning services. Koonsys
currently supplies Mobile Network Operators across Europe
and is expanding globally.

For more information, visit www.koonsys.hu

Omoco
Headquartered in India, Omoco, a global mobile network
provider, draws a rich pool of world-class engineering
talent and best brains in the world. The team, by the sheer
advantage of its lineage powered by Vihaan Networks Ltd.
(VNL), has a successful track record in creating innovative
wireless solutions. Omoco also translates its expertise to
provide agile & stand-alone private mobile networks in rural
communities, remote islands, enterprises and the latest IoT
(M2M applications) to enable our users become a part of the
wireless communication revolution.

For more information, visit www.omoco.in

w w w.developingtelecoms.com | October 2016

05
Emerging Markets will take a fresh approach to Last Mile

Ian Keene, Vice President of Research, Gartner

DT Editor James Barton spoke to Gartner’s Ian

Keene to assess the use cases for Last Mile in
emerging markets as compared to developed
markets, and how cost implications could
stymie development.

The need for last mile connectivity applies to various use

cases. What are the predominant ones?

There are three main use cases for last mile connectivity.
The most obvious is connecting rural and remote regions,
but easing the load on densely populated urban areas is an
increasing concern. Finally there are the shoulder areas that
fall between these two extremes.

In each of these use cases, different technologies may be

more appropriate.

Ian Keene - Gartner Rural & Remote Regions

Which technologies dominate in these areas?

In markets that are very underdeveloped such as in Africa,

the standard method for last mile connectivity is wireless
– 2G or 3G technology – because it gets the coverage, and
in these regions coverage is more important than capacity.
However, that means that applications have to be very low-
bandwidth – this is a limit, but not always a problem.

In India for example, we’ve seen that people are adept at

getting the most out of very low bandwidth. Plus we’re
starting to see things improve – faster technologies from 2G
to 3G to 4G, which will begin to provide more capacity as
well as just coverage. Obviously coverage is an issue; in rural
environments, service rural communities will be the focus
rather than covering the entire area, otherwise things will
prove too expensive.

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06
How will development progress in comparison to
developed markets?
Developing countries will begin to go the way of developed
countries, where now operators are looking to extend
coverage to small communities and villages rather than
for example extending 4G coverage over the entire
country, which is incredibly expensive and offers no real
business case. In the developing world, the business case is
paramount – it’s pointless to have a vast amount of capi al
expenditure is there’s going to be no return on investment –
so I think it will happen the same way.
While wireless will be significant, we’ve also seen cases
where Wi-Fi has become important; if there’s a fixed
line coming into the community then people can share
connectivity through Wi-Fi. The benefit of this technology
is that it’s in practically all devices that people use, allowing
it to remain low-cost in comparison to cellular, where the
price rises incrementally between 2G, 3G and 4G. Wi-Fi can
also be used on old devices such as older PCs, which is a
significant factor in emerging markets.
The ubiquity of Wi-Fi makes it a good way of connecting
communities in tandem with fixed-line backhaul. On that
side, we’re seeing a similar situation in developing markets
to the one that unfolded in more developed markets, which
is that the distance between fibre optic cable and end user is
getting shorter. Fibre is going out to more of the network –
it’s not reaching the end user of their remote community by
any means, but it is getting closer. In terms of maintenance
costs, if one can run a fibre cable – assuming the right arrays
for the copper infrastructure are present – a lot of the more
localised central office-type locations can be disposed of,
reducing OPEX, and the connection becomes more reliable.
The shorter the length of copper/COAX at the end there, the
higher the bandwidth that can be provided. Of course, in a
lot of developing countries people steal copper cable, which
is a problem, so getting rid of as much copper as possible is
positive. It’s a long time before fibre is going to reach into the
rural communities in many countries, but it’s getting there.
Then of course there’s satellite, which is increasing in
bandwidth and – sort of – coming down in price. I was
recently with NBN, the National Broadband Network in
Australia, which is one of the few neutral networks in the
world. The government has essentially ordered them to
supply broadband to all households, which is no mean feat
given the large number of extremely remote communities in
Australia. The only answer there is satellite, as anything else
is ridiculously costly – in practical terms, it’s the only way of
connecting these communities.
Satellite will therefore always play a part; it’s more expensive
and doesn’t always provide the performance of a fixed line,
but it’s often the only way of providing communications to
remote environments. Lower income people such as farmers
in emerging markets aren’t going to be able to afford a
satellite connection; the best they’d likely be able to afford
is a 2G phone. Putting cellular out in such a remote area isn’t
going to make business sense though, so it has to be funded
some other way.
In conclusion, very low cost cellphones and Wi-Fi devices
are going to be crucial for connecting people; satellite
plays a part at connecting communities but in developing
countries personal satellite devices will be too unaffordable
for working classes.
w w w.developingtelecoms.com | October 2016
07
High-population Urban Areas
Which technologies are being used to ease the network
load caused by urban densification?
It depends how much government support there is – it’s
hard to have a five year ROI in upgrading all this, so if a
government steps in with an incentive then that definitely
helps. Getting the cost of putting a new network into place
is crucial – organising rights of way, deploying cables in the
ground; these are a huge percentage of the CAPEX cost.
Where these costs are low is where we see communications
growing in terms of bandwidth and availability of service.
For example, putting fibre past a premise in an urban
environment – the Chinese Ministry of Communications
can get the cost of this down to well below US$200 per
premise, which is pretty incredible, particular compared to
an FttH project in Australia which budgeted AUS$3000 per
premise. In Russia, people just put wires up wherever they
like and don’t have to worry too much about permissions –
those are about $230 or so. In the US, they’re trying to get
the cost down to $1500, and that’s in a scenario where the
city is allowing them to use their power, not implementing
planning restrictions etc, so there’s a huge variety of costs
in getting fibre closer to the premises. For example, putting
fibre in a block of apartments and then using the internal
cabling would provide much higher bandwidth services, but
it means everyone has to play ball. In some environments it
works but in some people just oppose each other, nothing
happens, money disappears and the project fails.
The technology’s there – it’s the organisation that’s needed.
Looking at a country like China for example; despite its
big cities, it has a lot of people in rural communities. As
the government essentially dictates how roll-outs should
happen, costs can be kept down. In other markets, where
operators are opposing each other, it can be chaos and
nothing happens – organisation has a lot to do with it, it’s
not necessarily the economic strength of the country or its
location. If projects can be organised and everyone believes
broadband access will be great for the community then it’ll
work; if everyone wants to fight their corner and make as
much money as they can then it’s always a failure.
In China, all the major operators are state-owned; what about
in a more competitive market such as India?
India has ridiculous competition; there’s so much
competition nothing happens, it’s anti-competition in a way!
It’s had the opposite of the intended effect, as no-one does
anything. They can address this issue with consolidation; the
regulators have shot themselves in the foot by limiting the
amount of spectrum they were willing to license for mobile
use. They cut it into such little slices for everyone that –
while it was OK for voice networks – it’s absolutely useless
for data. Operators are therefore unwilling to invest – how
are they supposed to get new services to people when they
haven’t got the raw ingredients to work with because it’s too
widely divided among a lot of competitors? In that sense,
India’s a great example of what not to do, while China’s a
great example of what to do.
w w w.developingtelecoms.com | October 2016
08
Not every market in the world can bring their operators under
government control – how can China’s example be emulated in
a free market?
Where it also works is when the city or regional government
gets together with the interested parties – i.e. service
providers and stakeholders – and builds public-private
partnerships. This is more common in developed countries,
such as Tier-2 or Tier-3 cities in the US – it’s organised on a
local basis, resulting in a win-win situation. It doesn’t have
to be on a national basis. Government regulators need to
set rules in place that enable the growth of communications
without being too authoritarian about it; competition isn’t
necessarily the best way of moving forward, a monopoly
situation can be better if everyone sees the benefits. If
it’s a state-run monopoly, then those benefits are better
communications and therefore a better economy in the
area that the communications are provided. Having the
interested parties work together is key, but so is having
projects that themselves work.
It’s also important to be technology-agnostic; we’ve seen
some chronic failures where the government has decided
on what the tech will be, and one technology does not fit all
situations – it’s a path for disaster. China has decreed that all
new constructions must use fibre, which is fine as they have
a lot of new construction going on, but they don’t stipulate
this for older premises. If they said that every premise had
to have fibre, this would multiply broadband projects by
around a factor of five over time; however it would be hard
to see the successes of this as it would be spread out in time.
In Australia, the government pledged fibre to the premises
for around 90% of the population and promptly took
a step back when people pointed out that there were
perfectly good networks in place that could be enhanced
in order to deliver these services, rather than building out
new infrastructure at massive expense. So they utilised
the current infrastructure and improved the bandwidth
that people receive, regardless of whether they’re in an
extremely remote rural area or right in the middle of a city
centre. Being pragmatic about technology and leveraging
what’s there generally makes sense, although of course
there are some environments where it really doesn’t, and
has to be replaced.
In conclusion, we need to see operators being pragmatic
and making use of the assets, while regulators need to avoid
being too dominant.
‘Shoulder’ Areas
How can we define ‘shoulder’ areas and what are the best
approaches for connecting them?
People usually look at this in terms of population density; you
have dense cities, sparsely populated rural areas, and then
suburban ‘in-between’ areas. However, this can be the wrong
approach – it can be better to look at ‘pay-packet density’.
Where do people have money to pay for these services – or
alternatively, where are businesses located? These areas can
become a focus after cities – the number one priority – have
been developed. A lot of countries are now cottoning on to
a demand-based model, which prioritises vocal communities
calling for improved services over quieter areas that aren’t
requesting them. This harks back to the idea of domineering
regulators – government departments often won’t take this
idea into account at all, they’ll have their own programme
whereby certain areas get services first purely because it’s
part of the plan. They have to look at how local economies
could benefit and take demand into account, rather than
having bureaucrats planning the project without going out
and talking to the communities.
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 BIO
A lot more money is being ploughed into broadband access Ian Keene, Vice President of Research, Gartner
year-on-year as people see that there’s a need for higher
bandwidth connectivity. There’s a strong commercial Ian Keene is a Vice President of research at Gartner. He
element to this, as businesses will be attracted to locate in analyses and advises on the broadband access market
areas with good connectivity. The digital divide between globally.
high density urban areas and rural areas is getting bigger in
developing countries – it’s certainly an issue in developed
countries. Costs are a bigger issue in developing markets so
this is likely to continue – the ROI in urban areas is always
better, so citizens in rural areas could be left further behind.
Rural communities might have download speeds of 2Mbps,
while it can be 1Gb-2Gb connectivity for city centres, so
the gap between users across these areas is becoming
much wide – some applications can’t even be used in rural
areas as the connectivity isn’t good enough. Bringing the
economic benefits of good communications to rural areas is
an issue faced by many emerging markets right now. Left to
a commercial environment, people in the cities will be the
ones who receive service while rural areas will develop at a
much slower pace.

How can operators be incentivised to connect rural areas?

It’s a tough one; the accountants would just say the ROI isn’t
good enough. This is where regulators need to step in and tell
operators that they’re required to serve rural communities;
they can change rules slightly or offer incentives e.g. public-
private ownership schemes. Left to purely commercial ways,
rural is increasingly going to be left behind.

w w w.developingtelecoms.com | October 2016

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Intelligent Planning for Optimisation of Last Mile Connectivity

Krisztian Novak, Co-Founder & Stretegic Business Development Director, Koonsys

In this article the writer examines how the

backhaul sector used for last mile connectivity
has grown piecemeal, often without proper
strategic planning, as radio access networks
have expanded. As 5G and IoT drive data
demand to new heights it will become essential
for MNOs in emerging markets to look for new
ways to optimise these parts of their networks
to maintain quality of service and control costs.

For the overwhelming majority of end users in emerging

markets last mile connectivity is delivered over the backhaul
element of a radio access network (RAN). The integrity of
this connection has a major bearing on quality of service,
but despite this many backhaul networks are operating
Krisztian Novak - Koonsys sub-optimally for long periods, often resulting in significant
increased costs as well as underperformance for Mobile
Network Operators (MNOs).

There are a number of reasons why this situation has arisen.

Over the last 20 years there has been a constant flow of RAN
technology changes. This has led to the need to upgrade
and expand the Transmission Network (TRM), sometimes
without a clear business case. With the mass adoption of
data services - primarily via the rise of smart phones - the
demand on the TRM has increased exponentially. This has
made the TRM the key enabler of quality service – and
therefore profits for MNOs.

Moreover, far from remaining level, the pressure on TRMs is

only set to increase even more rapidly as 5G and the concept
of the Internet of Things are becoming a reality. This will lead
to ever more complex multi-technology networks, with an
ever greater amount of bandwidth required. This is a major
challenge to existing TRMs which will need to expand to
support all RAN technologies from 2G to 5G and beyond.

w w w.developingtelecoms.com | October 2016

11
Development of new technologies for wired and wireless
transmission is a must, and all major manufacturers are
investing in R&D to meet this challenge. However, the
majority of the R&D effort is aimed towards hardware
solutions which could add further complexity to the
network. Transmission network planners need to develop
strategic plans to meet the current demand and the future
challenges that 5G and IoT will bring.
Backhaul network improvements providing last mile
connectivity were tailored to RAN needs, typically as a next
step to roll-out. As backhaul was not the blocking point for
end user quality in 2G networks, MNOs initially put more
emphasis on RAN optimization with little or no consideration
of the TRM. This has led to TRM networks being far from
optimal, with room for major quality improvements and,
more exciting, significant cost savings.
Balancing the Technical and Financial Needs of MNOs
The challenges facing operators in last mile network
planning are both technical and financial, but ultimately
the challenges come down to how to balance the ever
increasing demand for data and subsequent pressure on the
transmission network with the ever-reducing ARPUs.
The best solution would be to build an unlimited capacity
fibre optic transmission network. However, the reality is that
this is a dream for the vast majority of network operators
in emerging markets so more sensible solutions utilizing
existing infrastructure investments need to be adopted.
A cost effective approach is a hybrid deployment of fibre
optic and wireless backhaul technology, leveraging existing
investments where possible. However, existing engineering
practices have failed to come up with suitable solutions once
the level of network complexity is reached. In general they
address isolated problems, with technical solutions. This
creates a paradox, engineers are working to find the best
technical solutions, while management are looking for the
best value with a quick ROI.
Traditional network planning tools, in line with current
engineering practices, focus on technical solutions and lack
any financial aspect. This leads to a limited solution, which
needs to change. A shift is required to an “optimization
focused” design methodology, integrating a full scale
analytical approach in the network design phase.
The iNOP solution developed by Koonsys provides a solution
to these challenges for both Greenfield network projects
and large scale network expansions. iNOP, standing for
Intelligent Network Optimization, provides answers for the
most demanding dilemmas of network build, operation and
expansion including:
r How to plan and build a future-proof transmission network
with the lowest TCO but maximized capacity;
r How to minimize TCO of RAN and transmission networks;
r How to make savings on OPEX while improving the
capacity of TRMs;
r How to support marketing planning under time constraints;
r What-if analysis to support technical strategy planning
r Scenario analysis for budget planning to find the optimal
solution
r Regular analysis of savings potential in the network
r How to manage TCO through operation to reach the
highest levels of efficiency
iNOP utilizes mathematical algorithms, to efficiently manage
complex networks and analyze a huge number of network
variants. This enables MNOs to effectively manage and
operate their networks. iNOP acts as the central brain of
network development during the networks lifecycle. With
iNOP, MNOs are able to maintain their network at an optimal
level at all times, the network is always up-to-date, network
operation costs remain low, and there’s no need for ad-hoc
network optimization which demands unpredictable and
irrational investments.
w w w.developingtelecoms.com | October 2016
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Understand Your Real TCO - and Prepare to be Shocked
The Total Cost of Ownership (TCO) of a TRM network is made
up of multiple CAPEX and OPEX components. Some of these
components are directly linked to the number of network
elements, others indirectly, and some are quasi-taxes (e.g.
frequency licence fees). MNOs are able to influence some
of these components, but not all, and the TCO structure
changes throughout the lifespan of the TRM.
Furthermore, the TCO can sometimes be influenced more
by the Engineering department while at other times by
Operations. This can lead to conflict within the organization
with potentially damaging consequences on the TCO of the
Network.
iNOP enables full scale TCO control during the design,
implementation and operational phases, ensuring a
technically superior network running at low costs -
fundamental for all CTOs and CFOs. Koonsys have run
tests for several networks with iNOP, and the findings
are shocking - but let me emphasize, not because the
MNO’s engineering staff do a lousy job; in fact, it’s exactly
the opposite. There are some excellent engineers out
there; however, we are seeing rapid and major changes in
technology, shareholder requirements, etc.
Existing Organically Growing Networks
Organically growing networks always have some room for
improvement. We have seen room for 20% and even 50% cost
cuts although as a rule of thumb we estimate that over 15%
OPEX reduction can be achieved in any network with iNOP.
With savings of this level there are multiple factors involved
which can typically include any or all of the following:
r Unnecessary microwave links - these average between 15-
20 % in any network;
r Optimized topology
r Dramatically reduced frequency usage fees
r Reduced 1st and 2nd line maintenance fees
r Reduced network level electricity and power generation
fees
r Reduced vendor related equipment support fees
r Reduced end of life replacement fees
Our experience shows that part of these cost savings come
from “low hanging fruits” that can be harvested quickly
to provide a rapid return on investment. For example, in a
recently completed pilot project we found a 36% frequency
fee reduction opportunity for a CEE wireless service
provider. The normal payback period for savings such as this
is less than one year but it can take up to 1.5 years to realise
the full level of savings.
CAPEX and OPEX savings of this level provide a big incentive
for MNOs to integrate iNOP into their networks. In case of
Greenfield or upcoming network expansion iNOP makes
sure that the use of CAPEX is optimal and you do not create
a monster that eats up your OPEX over time. With iNOP
running in the background you can spend your time on
other important tasks to win the race.
w w w.developingtelecoms.com | October 2016
13

About Koonsys
Founded in 2004 Koonsys is a premium supplier of Radio and
Transmission network optimisation and planning services.
Koonsys works with major brands including T-Mobile,
Telenor, Aircom International and Nokia. As the largest
independent wireless engineering company in Hungary
Koonsys serves MNOs and wireless network operators across
Europe and to an expanding global base of customers.
BIO
Krisztian Novak, Co-Founder & stretegic business
Development Director, Koonsys
Mr. Krisztian Novak is co-founder and Strategic Business
Development Director of Koonsys Radiocommunications
Ltd. He has expertise in planning tools, OSS software, GIS
and custom software development such as interfacing
OSS products to GSM/UMTS and transport networks. Prior
to establishing Koonsys Mr Novak held senior engineering
positions at Orange Switzerland, Telenor and Vodafone.
w w w.developingtelecoms.com | October 2016
14
Tackling Last Mile from an African perspective – which solutions will work?

Thecla Mbongue, Senior Analyst, Middle East & Africa, Ovum

Currently wireless is typically the technology

used for last mile connectivity in Africa,
although this only offers low bandwidth.
While this may not currently be an issue, it will
be eventually. How can operators improve
bandwidth and what technologies are best
suited to this?

LTE (4G) is meant to handle download speed rates of

between 5mbps and 12mbps, which is comparable to
speeds obtained from fixed broadband networks. There is
increased investment in LTE in Africa, and the technology
is used as a substitution to fixed broadband. However LTE
deployments and coverage are still limited across Africa due
to spectrum allocation and cost issues.

https://www.ovum.com/regulatory-stance-holds-up-lte-
rollout-in-francophone-west-africa/
Thecla Mbongue - Ovum https://www.ovum.com/lte-is-displacing-wimax-in-africa/

Satellite is increasingly frequently touted as a way of

bringing connectivity to the remotest communities. Will the
business case for extended satellite based cellular services
to Africa’s remotest communities ever stack up given the
reliability and capacity limitations as compared to wireless?

Satellite’s key asset is its full territory coverage. However, so

far, the technology has been used to provide broadband to
a niche corporate market due to high prices. Competition
from the mobile networks has pushed satellite broadband
providers to explore and roll out more affordable
solutions, mostly markets to the SME segments. Rural and
underserved populations are usually on lower income and
affordability (price of terminal) remains a challenge for them
to make use individually of satellite connections. There is
however a business case for shared service centres (kiosks,
cabins, internet cafes) providing access to a community.

w w w.developingtelecoms.com | October 2016

15

Wi-Fi is increasingly being used for last-mile connectivity –
what are the advantages of this tech solution in Africa? Is it
used more for connecting rural areas or easing loads in high
density urban areas?
Wi-Fi is for the moment mostly used to enhance access in
high density urban areas. It can be sponsored by institutions
(Government, universities, municipalities) to provide free
access, provided by businesses (restaurants, shopping
malls) to add value to their services or run directly mobile
networks in various locations. On an operator point of
view, it helps reaching customers who do not necessarily
subscribe to their network, either local customers or
international travellers.
Some analysts suggest that the regulatory environment
needs to be fairly relaxed and that too much competition
can stymie progression, as building out a network cheaply
requires a lot of coordination. What’s your take on this?
I have mixed feelings. Building a network takes time and
resources, but sharing infrastructure could be a way to
reduce costs, especially when rolling out in underserved
areas. As for competition, MVNOs could be a way to increase
competition, meaning that the MVNOs would concentrate
on marketing and consumer acquisition as long as they
already have an existing base and distribution channel.
BIO
Thecla Mbongue
Senior Analyst, Middle East & Africa, Ovum
Thecla Mbongue is a senior research analyst in Ovum’s
Middle East and Africa team and has a key focus on
telecoms, media, and technology (TMT) in sub-Saharan
Africa. Her research interests cover operators’ strategies
as well as network and regulatory development,
including mobile broadband technologies deployments,
smartphones and data traffic uptake, and mobile
financial services usage.
Thecla is a regular speaker and chair at industry conferences
in the region and regularly comments on industry
developments for regional and international media.
Thecla joined Informa in 2003 (research unit rebranded
into Ovum in 2014). In her previous roles, she worked in
England as a marketing assistant with global telecoms
carrier Vectone.
w w w.developingtelecoms.com | October 2016
16
Last Mile Rural Connectivity - Moving Beyond Traditional Network Infrastructure

Tim Guest, Freelance Communications and Business Writer

In a world where mobile connectivity is taken

largely for granted, it is hard to imagine that
around 50% of the global population remains
unconnected. Costs associated with deploying
traditional mobile networks in isolated regions
have long been amongst the key barriers to
providing remote connectivity services, but
luckily, the technology now exists to provide
viable wireless voice and broadband to even
the most inaccessible locations on earth, as Tim
Guest reports.

It’s an unfair world when it comes to the ‘haves’ and ‘have-

nots’ of mobile communications. There are rural and remote
communities, which continue to face hardships every day,
Tim Guest
with their businesses unable to flourish due to a restricted or
non-existent ability to communicate with the wider world.
Families also suffer when loved ones leave home to find work
abroad, perhaps even going to sea for prolonged periods,
but are unable to stay in touch. The knowledge that mobile
services have been available for more than 20 years in many
urban and semi-urban areas only adds to the frustrations
these isolated and underserved communities experience.

A large part of the responsibility for the digital divide

lies with the mobile network operators (MNOs), though
understandably so, as it has largely been a result of the high
capital outlay typically associated with macro base station
sites and tower infrastructure, including the laying of fibre.
Add to that the ongoing operational costs from transmission
and power supply, including fuel and logistics for the
widespread use of diesel generators and these have all been
major barriers for any MNO considering rolling out mobile
services to remote communities, anywhere. These costs
have simply made the proposition unviable.

w w w.developingtelecoms.com | October 2016

17
While remote populations - together with remote enterprise
operations, such as mining and oil & gas exploration -
often remain underserved and unconnected by effective
communications, they are no longer seen as service-delivery
challenges for MNOs and regional governments. They
now constitute serious revenue-generating opportunities
for many stakeholders. The good news is that pioneering
technologies are now available and operationally proven to
deliver advanced voice and broadband services needed to
generate viable profit margins for the service providers and
MNOs in almost any isolated region.
One solution among a growing field
One such solution is provided by Omoco, which primarily
caters to the civil rural & remote space and whose parent
company, Vihaan Networks Limited (VNL) has been pioneering
remote wireless communications solutions for many years.
Omoco’s family of network-in-a-box solutions are already
proven in remote civil deployments in a number of regions,
and offer remote communities and enterprises scalable,
deploy-it-yourself systems that enable users to get connected
with minimum effort, wherever they are.
The company says its small cell solutions, which cost a
fraction of a macro cell deployment, are ideal for situations
where subscriber base is typically very low, and that they
can support populations of as few as 300 people or upwards
of thousands, with each deployment presenting a viable
proposition for the operator or customer/owner. Because
remote areas are often off-grid with little or no electricity
supply, Omoco solutions, with battery back-up, have the
option of running on solar power and can generate and
store the low amounts of power required to run the system
which supports both voice and data communications
The masts used to support the solutions do not require
complex logistics to transport and erect and are only 15 to
30 metres tall, depending on the topography and coverage
required. In some cases, when tall structures or elevations
are naturally available, towers may not even be needed to
support the remote network equipment.
Talking to Developing Telecoms, Ms Bhawana Daga, Head
of Marketing and Communications for Omoco, told DT that
Omoco is essentially one product with different variants
and many applications. “Our target customers,” she said,
“are the people who would install our system, such as VSAT,
VOIP operators, ISPs, as well as aspiring entrepreneurs who
wish to set up a community network and earn subscriber
revenue. The end user, on the other hand, is anyone who will
benefit from using the network solution, such as villagers in
rural and remote communities, or, in the case of our remote
enterprise solution, users such as oil exploration and mining
company personnel.”
Ms Daga added that the company’s customisable and
scalable systems are also suited for customers such as
hospital owners, hotels, office complexes and building
owners, with end users being the people working inside
these establishments. “Different variants of our system can
offer enhanced coverage and capacity,” she said. In a typical
rural deployment scenario, one variant offers a stand-
alone network-in-a-box for communication only within the
remote area providing coverage to ranges of about 5km
radius – typically one village or a group of villages. Such a
deployment can be scaled up to provide connectivity with
the wider mobile core network through a regional MNO.
w w w.developingtelecoms.com | October 2016
18
Omoco has a variant that is ideally suited for deployment
in disaster relief scenarios to provide rapid local area
coverage for NGOs, emergency first responders, and search
& rescue teams who deploy to areas following the likes of an
earthquake, when regional telecommunications are down
and an easily deployable mobile network is required.
Overcoming CAPEX and OPEX challenges
There are a range of players, including satellite and large
mobile infrastructure companies, optimising and deploying
new remote wireless solutions around the world. Some
use architecture that switches all local calls locally at the
community base transceiver station (BTS), reducing costs
associated with switching back through the core network.
This also has the effect of minimising the delay experienced
on non-local switching thereby improving the QoS.
Some of these remote community systems rely on VSAT
satellite backhaul to the core network and have adopted an
intelligent use of power and transmission so that resources
are only being used when communications are taking place.
This restricts the use of high-cost satellite bandwidth and
also keeps power usage to a minimum, particularly during
off-peak hours. Some use alternative energy sources such
as solar and wind power doing away with the challenges of
using and maintaining diesel generators.
These new technologies have enabled operators to
overcome the capex and opex challenges indicated; their
architecture has removed the need to outlay on capital
and physical transportation costs for standard tower
infrastructure, as well as costs associated with diesel to
power off-grid, fuel-hungry base stations. The high cost
of satellite backhaul transmission has also been removed
in the case of some of these new remote community
communications technologies.
So, when an isolated community has been unconnected for
its whole existence, or an enterprise operating in a remote
location simply needs to begin by communicating within its
own immediate area, a simple, easy-to-install system that
can be easily scaled up later on to provide total connectivity
is an ideal start-point.
w w w.developingtelecoms.com | October 2016
19
A final word BIO
When the deployment of a traditional BTS can cost as much Tim Guest, Freelance Writer
as US$250k, deploying such a solution in remote regions
makes no sense. With the emergence of solutions such as
the Omoco network-in-a-box family, however, low capex Tim Guest is a freelance communications and business
and opex deployments mean that more stakeholders than writer and journalist specialising in communications and
ever before can get involved. From system integrators and
VOIP operators, VSAT operators and ISPs – and not simply electronics.
the MNOs – these new players can all move up the value
chain by deploying such scalable and versatile solutions in
areas where a traditional network site simply does not make
sense in terms of ROI.

Ms Bhawana Daga concluded, “With the average cost of an

Omoco deployment coming to around US$10,000 versus
the cost of a traditional network deployment, our solutions
offer real opportunities to bridge the connectivity divide for
the billions of unconnected people.”

w w w.developingtelecoms.com | October 2016

20
Fibre – the ultimate last mile – now showing explosive growth

Stefan Stanislawski, Co-Founder, Ventura Next

While much of Africa is celebrating the recent

upgrade on Internet performance going from
2G mobile to 3G, a new trend has started. In
winter 2014 the first customer went live on
Vumatel’s FTTH network in the Johannesburg
suburb of Parkhurst. This event started a
revolution in two ways:

r It fired the starting gun in a race to build Gigabit networks

for the home and small business;

r It showed that the dynamic Swedish style open access

was not only possible in Africa but is hugely popular with
residents.

The first factor is technical and the second commercial -

together they have stimulated a wave of entrepreneurial
activity and investment with several new competitors trying
Stefan Stanislawski - Ventura Next AB to copy the success and operational excellence of Vumatel.

This trend has spread rapidly with FTTP investment now

underway, even if on small scale, in many African countries.

Waves of investment in African telecom past, present

and future

Previous waves of investment created the conditions for

the growth of fibre. Very fast internet connections clearly
need both high capacity backhaul and global connectivity.
Through a combination of private sector and numerous
World Bank projects, many backbone fibre networks now
exist and need to be filled with traffic.

w w w.developingtelecoms.com | October 2016

21
The current extent of African backbone fibre is shown by the excellent and open source AfTerFibre map.

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22
Dynamic Open Access Fibre Networks
– the Swedish Model
Open access fibre networks first evolved in Sweden
immediately following the burst of the “telecom bubble”
in 2000. Over 15 years several models have emerged,
tried and abandoned as unworkable either technically or
economically. The one that has survived has been refined
and currently about 25% of all Swedish households are
connected to dynamic open access fibre networks where
they can freely choose between all the major, and many
smaller, brands and a plethora of services. With one
exception, these networks are all active sharing and use the
powerful and future-proof active Ethernet configuration.
The exception is the publicly owned city of Stockholm
network (Stokab) that deploy a passive sharing model,
i.e. allows service providers to connect directly to its dark
fibre. This model is made possible as the city will not let
anyone, except the incumbent, deploy fibre in the city and
that the Stockholm market is exceptional in terms of the
concentration of Government entities and large businesses
where the passive sharing model can be economical.
On the other hand for fibre networks covering less than
100,000 households, the active sharing model is the more
economic one. Active sharing also lowers the barriers to
entry for the smaller service providers, who do not need to
invest in their own equipment but can market and sell their
services to a reasonably large universe. In fact, the dynamic
open access model is designed to be particularly suitable for
the smaller service providers. This is important as the larger
brands, who by tradition are used to vertically integrated or
closed networks are initially often sceptical to open access
model meaning the first movers in this sector are often the
smaller service providers. However, as the larger brands get
comfortable with the dynamic open access model they are
often quick to join.
For independent fibre owners, such as local Governments,
energy companies, real-estate owners, developers or private
investors, the dynamic open access model is the model that
has shown to achieve the highest penetration (consumers
and business actually taking service over the fibre in relation
to those who are passed by fibre infrastructure) and achieve
this quickly. Experience from Sweden and elsewhere show
penetration levels in the mid to high 70-ies per cent after 18-
24 months, depending on competition from modern coax
systems enables with Docsys3.
w w w.developingtelecoms.com | October 2016
23

Fibre for the Mass Market?
The current investment in fibre is going into upper and
middle class homes and businesses areas. This is where
the immediate need is greatest and the economics most
favourable. For South Africa the estimates commonly
bandied around are for 1.5 to 2 million potential connections.
If we think only on terms of mainstream operators with
larger scale institutional funding, then this seems reasonable.
However, in many countries in the past, low GDP per capita
had not hindered the growth of CATV or FTTH networks.
Particularly in the case of traditional CATV, the technology
was simple enough that local entrepreneurs could build
ultra-local networks that worked. Across Asia and parts
of Europe hundreds if not thousands of local networks
emerged often with little legal documentation. Over time
these were bought up and professionalised into larger
operators. My belief is that the same could easily happen
with fibre over the next decade. These are exciting times!
BIO
Stefan Stanislawski
Co-Founder, Ventura Next AB
With over 25 years helping boards, senior managers
and regulators to make critical decisions in both fixed
and mobile telecoms, Stefan’s work has encompassed
all aspects of telecommunications strategy, business
development and litigation as well as participating in some
$100 billion worth of telecom financings or acquisitions.
Stefan continues to have an operational role in
broadband – he has a part time commercial and
financial role with the same team to take the open access
network management elements of the operation global
– delivering the first Gigabit service for subscribers in the
whole of Africa (passive layer owned by Vumatel) as well
as projects in Europe and South America.
In the past he has been on the board of various telecom
companies, has run a niche voice service provider and
was Head of Spectrum and New Licences at NMT in
Scandinavia.
w w w.developingtelecoms.com | October 2016
24
Connecting Africa: Last Mile from the operator’s perspective
Tolulope Williams, Senior Manager, Access, Transmission, Planning & Optimisation, MTN Nigeria
Tolulope Williams - MTN Nigeria
MTN is one of the most widespread operators
in Africa, present eighteen African. While
obviously Africa’s comparative dearth of
infrastructure sets it apart from most developed
markets, the lack of legacy architecture presents
many opportunities for creative problem
solving. DT Editor James Barton discussed this
with Tolulope Williams, the senior manager for
access transmission planning and optimization
at MTN Nigeria.
Which aspects of Last Mile Connectivity is your team
responsible for?
My team is responsible for planning and optimizing the
access network, which is predominantly microwave, but we
are also increasing our fibre penetration. We plan microwave
connectivity, mainly for mobile sites for rollout – for 2G, 3G
and LTE. We also plan the access fibre as part of the access
aggregation network, and we take fibre to microwave hub
sites. The way our network is we have hub sites that sites
aggregate to, and we try and take fibre through these.
In Africa as opposed to developed markets, what are the
last mile connectivity issues that you face as an operator?
Our Last Mile Connectivity is predominantly microwave, so
a major challenge is the availability of spectrum. In certain
locations, such as cities, the microwave space is really
congested – especially the last mile frequencies of 18GHz
and 23GHz, and that brings about a lot of challenge. You
have multiple operators contending for these frequencies,
so apart from trying to avoid interference within your
network, there can also be external interference because
the licensing of the spectrum is not exclusive – whoever
gets there fist can use it first.
w w w.developingtelecoms.com | October 2016
25
Is that an issue that could be addressed by more
specific regulation?
Regulation can address that; we’re also looking into
alternatives to microwave, such as increasing fibre
penetration. We’re trying to increase the ratio of sites of
fibre on a yearly basis, but deploying it involves other major
challenges. For example, getting right of way – with multiple
government agencies controlling the same domain,
gaining the right of way to put fibre into the ground is very
expensive, with the government collecting a huge amount
of money. In a developing country like Nigeria, there is a
lot of road construction going on, and this impacts on the
deployment of fibre infrastructure – there’s no protection
for it. The regulator is trying to make fibre infrastructure
important and push this with the government but we’re not
yet there – a lot of road construction companies, especially
the smaller ones, don’t abide by the rules and won’t hesitate
to just break or destroy fibre infrastructure. There are
warnings in place, there are specific ways to work around it
but combating this attitude is really a major challenge. We
do want to use fibre to reduce the reliance on microwave
but it does have its problems.
One of the challenges you have is that everyone who wants
to deploy fibre, in 90% of the country you need to put in
your own infrastructure in terms of docks on the road; there
are only a few places where they build routes but also put
in docked infrastructure. A lot of things can help; if road
construction is standardised such that every road comes
with docks then it makes it much easier to put in fibre as it
eliminates the need to dig into the ground. However, what
happens today is that provision of docks is not prioritised
by the government, but this would be extremely helpful if
this infrastructure was included as part of the road build-
out; telecos would be able to come in and install fibre
into the docks. You’d also have more assurance that docks
provided by the government wouldn’t be as easily damaged
compared to an operator’s bespoke infrastructure.
With cost such a prohibitive factor to widespread
fibre deployment, what technical edge does it of fer
over microwave?
There’s really a limit to the amount of capacity you get on
microwave, and now the regulator is trying to open up new
spectrums like E-band. Nigeria is a high-rain region, and the
higher the frequency, the greater the rain impact. With new
broadband technologies like LTE and LTE-A, the capacity to
the cell site is increasing. There is really a limit to what you
can do on microwave; after a certain point, you need to be
taking fibre to nearly 80% of your sites if you want to offer
effective broadband. The main reason we are pushing fibre
is to be able to provide the capacity.
Capacity is particularly an issue in densely populated
urban areas. What are you doing to address network
congestion in these areas?
We are undertaking network modernisation to enable us
better use of the frequency by modifying the topology of
the network; by creating more microwave hub sites that we
can take fibre to, the existing hub sites are decongested.
One of the problems of frequency interference is having too
many leads in a particular tower; this is usually the case in
hub sites. We are creating a lot of new hub sites as part of
our network redesign and modernisation; if we can redirect
the leads to these sites and reduce the average number of
physical microwave leads that go to any individual site, that
helps with the frequency management.
We are also introducing Class 4 microwave antennas,
which have better radiation characteristics for combating
interference. This means that you can re-use frequency
a lot more; they’re slightly more expensive than Class 3
microwave antenna systems but they have that advantage.
With some of our hub sites we’re going from over 30 links
to a maximum of 10 physical links, which means we have
hubs going from supporting over 100 sites to supporting a
w w w.developingtelecoms.com | October 2016
26
maximum of 30 sites. By redesigning the network, creating
more hub sites, and reducing the number of links that come
to a particular microwave tower, we make better use of the
frequency and reduce interference. However, to do this,
we need to be able to get fibre to our sites, and once we’ve
done this we can start looking at how we can get last mile
fibre-to-tower.
How does the network’s topology affect deployment?
When we talk about ‘flat’ networks with regard to
microwave; you cluster your network and have various
hub sites, and sites simply go to the closest hub site. In the
existing network, you have microwaves links crossing each
other, but in a flat network they’re not flying over each
other, they’re just grouped into clusters and they don’t
criss-cross. This is what we mean by a flat network in terms
of microwave.
Does this make it more cost-effective to provide rural coverage?
With remote areas, from the business point of view, the
question is how much revenue you actually make from
these locations. Because of the cost of actually building out
microwave to such remote locations, we try to use satellite
as well. This comes with its own associated costs.
A lot of people come to us with different satellite solutions,
ones that allow us to minimise how much space segment
we have to buy from the satellite operator. We do have these
kind of networks at MTN but only a very few compared
to our physical sites, of which we have over 13,000; our
rural telephony network is less than 300 sites. In a lot of
countries, it’s actually the government that drives the
broadband initiative to rural areas; operators need a lot
of incentives in order to begin offering services. If you’re
going into a rural area, you’re not going to make money –
however, governments know that broadband is an engine
of economic development, so they need to incentivise rural
broadband deployments by helping operators reduce the
cost of doing this.
If operators are deterred by the cost of deployment, what’s
the incentive to deploy to these regions?
First and foremost, any operator needs to make money as
a company, but in trying to support the government with
some of their broadband initiatives for rural areas, the
major solution right now is satellite. There are initiatives on
the horizon to encourage rural deployment, and they are
expected to involve the government giving out contracts
to operators to provide coverage, but thus far they are not
widespread.
What are the other challenges in connecting remote areas?
One of the major challenges is intense competition – telecom
services have been commoditised, leading to intense price
wars in some markets, including Nigeria. There’s a huge shift
from voice towards data, and although this requires a lot
of CAPEX investment it doesn’t provide the corresponding
revenue. There’s been a lot of price erosion due to the
competition, with operators cutting prices to unsustainable
lows. Couple this with economic instability – in Nigeria,
the exchange rate is going up and this affects our ability
to import equipment – and it’s clear that operators are
beginning to feel the heat. The cost of phones is very high,
but operator revenue is way down so the prices are just not
sustainable. If things don’t improve, providers are going to
need to agree to increase prices, because if things continue
at this rate then we’ll see operators folding soon enough.
How are operators going to be able to compete in such an
environment?
If your revenue is declining, you need to start looking at
reducing your operational cost. There are a lot of initiatives
around reducing OPEX – it’s not just about reducing the
number of sites, it’s now about trying to generate revenue
from these sites. Obviously operators have to spend money
on their sites, so they’re looking at the impact of this on
their revenue and trying to work out how they can get sites
generating income rather than draining it. If it’s not going
w w w.developingtelecoms.com | October 2016
27

to be a coverage issue, they’re shutting the sites down;
it’s a matter of business optimisation in the name of cost
reduction.
MTN has done a lot of outsourcing in order to optimise
costs; we’re looking at models of tower-leasing wherein
another firm handles the construction of towers. In the area
of fibre deployment, we’re looking at similar possibilities
of leasing; this is common in South Africa but not the rest
of the continent. However, in a couple of years it is likely to
be more of a trend, particularly as the Nigerian regulator is
encouraging the model of infrastructure providers.
BIO
Tolulope Williams, Senior Manager Access, Transmission,
Planning & Optimisation, MTN Nigeria
Tolulope Williams is a graduate of Electronic and Electrical
Engineering from the Obafemi Awolowo University
(O.A.U) Ile-Ife, Osun State Nigeria. He also has a M.Sc
degree in Telecommunications from Birmingham City
University United Kingdom. He has attended several
Telecoms training both international and local. He has
16 years of experience in the Telecoms industry, 14 of
which has been in the mobile sector. He is a transmission
expert with several years of experience in operations
and maintenance and planning of SDH, DWDM, packet
and optical transport networks. He is currently the
senior manager, access transmission planning in MTN
Nigeria.Tolulope Williams is a graduate of Electronic
and Electrical Engineering from the Obafemi Awolowo
University (O.A.U) Ile-Ife, Osun State Nigeria. He also has
a M.Sc degree in Telecommunications from Birmingham
City University United Kingdom. He has attended several
Telecoms training both international and local. He has
16 years of experience in the Telecoms industry, 14 of
which has been in the mobile sector. He is a transmission
expert with several years of experience in operations
and maintenance and planning of SDH, DWDM, packet
and optical transport networks.
w w w.developingtelecoms.com | October 2016
28
For more on Last Mile Connectivity in emerging markets, visit

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