Communications

Mobile phones: Economic benefits, but also safety and strengthen family bonds

Aparna Ray, writing at Global Voices, provides an excellent set of references on the economic benefits of acquiring a mobile phone.  Most of the articles she points to appear in the mainstream press and most provide stories and anecdotes about economic benefits, so they are much more readable than the dry economics papers I typically reference, e.g. here, here, here or here.

While Aparna and I have both focused on the economic benefits of acquiring a mobile phone, it's interesting to note that economic benefits come second in the minds of those at the bottom of the pyramid (BOP), when they think about getting a phone.  This classic study by LIRNEasia shows:

- At the BOP, convenience, in terms of anytime accessibility, is the biggest driver in the purchase of both fixed and mobile phones.

- BOP users make an average of one call per day, mostly local, mostly 2-3 minutes long, mostly to stay in touch with family and friends.

Reading the text in detail, the idea comes across that phones provide a sense of safety, i.e. it's easier to find family members in an emergency, as well as comfort and connection.  Indeed, in all the studies, economic benefits are real but are secondary to why people want to acquire mobile phones.

Grey market Broadband access in Bangladesh

Here's another great picture from Tariq, taken when he was in Dhaka, Bangladesh to speak at the January 2008 meeting of SANOG.

At the top of the pole are power lines, but the rest of the stuff in the middle is an assortment of cable TV and fiber infrastructure, almost all run without the benefit of formal government regulation.

The result is people in at least some neighborhoods of Dhaka have access similar to what's on offer in Karchi, Pakistan.

Community Networks — the Robin Hood Approach

What kind of broadband Internet access would be possible if there were no government regulation?  Today every government in the world has laws or regulations on who can run cables in public rights-of-way but, in some places, these rules are not effective.  This has produced some very interesting case studies on what markets do in the absence government granted monopolies.

Last fall, I wrote two blog posts about the situation in Bucharest where essentially anyone can string cables in public rights-of-way.  The result are widespread fiber and Cat 5 cable networks and bundles of CATV + FTTB (100 Mbps FastEthernet) + telephony are routinely available for as little as 9 Euros (~US $12) per month.   Here is another case:

Desi Cable Networks in Lahore

Recently, I had a very interesting email exchange with Tariq Mustafa in Lahore about informal broadband access arrangements in Southeast Asia. (Tariq blogs as Tee Emm on Pakistan NextGen Issues and is also active on Telecom Grid Pakistan).  Tariq also has direct knowledge of local networks in Lahore and Karachi and indirect information about Dhaka (Bangladesh).  With Tariq's permission, I'll quote extensively from his emails, but first a quick summary of the situation as I understand it.

Access to neighborhood rights-of-way is governed by local relationships rather than by official government license.  As a result, there are extensive local broadband networks (fiber and Cat 5 cable) providing excellent local connectivity (typically up to 100 Mbps symmetric), including high speed access to local content caches.  Actual connections to the Internet are still limited so, while one can download movies from a file server at 30 - 50 Mbps, connections to the real Internet tend to be limited to 512 Kbps each.  On the other hand, the whole package costs roughly Rs 600 or about US $8, per month.  And, while exact figures are not available, it appears the number of grey market subscribers far exceeds those officially counted by the Pakistan Telecommunications Authority.

In short, where there is no government and no government empowered monopolist (in this case, the first 5-15 km), both fiber and Fast Ethernet are widely deployed, and prices are extremely low.  Actual connections to the Internet have to go through licensed ISPs and need access to the country's limited International cables.  These remain expensive.

Tariq's Explanation of Desi Cable Networks

Everything that follows is quoted directly from Tariq's emails to me:

DCN - Desi Cable Nets as I want to call them. (Desi is the word that means 'local' in our South Asian Languages. The word was necessary to differentiate these networks from the original hybrid fiber coaxial network that are generally called Cable Networks in the developed countries).

To answer your questions, here are some more facts. Feel free to get back to me if you have more questions. I consider myself a vocalist when it comes to these DCNs and the impact that these have created (in the absence of the actual formal industry rising up to the occasion for the digital needs of the masses). I talked about this at Sanog XI in Dhaka (Bangladesh) earlier this January <2008> and the title of the talk was 'Community Networks - Crowning the Robinhood'. This summaries what I mean.

1. DCN is an eco-system of operators, consumers and social realities.

2. A DCN eco-system is characterized by high desires for middle class community to get online, low affordability, lack of regulation, low concerns of digital communication security and poor infrastructure of electricity and underground cables.

3. A DCN successfully delivers (often partial) Internet services in the wake of the above obstacles to large parts of population.

4. In a DCN eco-system, there is one part that can be referred to as the 'junknet'. The junknet is an instance of anywhere from 50 to 150 houses connected to empirically <located> Ethernet switches mounted generally on top of utility poles and interconnected to each other over Cat5 cables. A junknet is characterized by lack of any intelligence. There are no AAA servers, no bandwidth managers, no routers etc. It is essentially a collection of Cat5 cables coming out of houses and connecting to Ethernet switches on the utility poles. These Ethernet switches are cascaded to allow the junknet to connect together from 50 to 150 houses typically.

5. A junknet operator essentially performs the following in this ecosystem:

1. Maintenance of the Junknet cable system.
2. Making cable connections for end users.
3. Helping end users with the set up of the connection at the PC.
4. Securing rights (mostly informal, driven by local influence) of taking the cable in the vicinity.
5. Provisioning and upkeep of the Ethernet switches mounted atop the utility poles in the area.
6. Securing UPS based power for the switches where possible by offering discounted or free DCN service to participating teens in the area.
7. Fee collection from the end users and depositing to the aggregator. Bills or pre-paid balances are managed and are generated by another entity.

6. Junknets terminate at router points that are placed in the locality by another player within the DCN eco-system. Let us call them aggregators. To save costs and to remain at the lowest price points, the aggregator uses small Linux based PCs with up to 6 Ethernet interfaces running Zebra for routing. Aggregators are intelligent in that they have elements that do routing and silence the broadcast storms that are possible (and often quite common) in the individual Junknets they power.

7. Aggregator networks make extensive use of optical fiber, once again, running on utility poles. Again, to keep costs down, these operators do not use optical Ethernet switches as one would expect but employ low cost media converters to connect the router PCs together over great distances - generally 5 to 15 km.

8. These router PCs are aggregated on proper Cisco Ethernet switches (for the first time in the ecosystem).

9. Typical DCNs operate over 1 Gig of network capacity between the switches with recent news of the trunks being upgraded to 10 G on experimental basis. The DCNs in Pakistan run on a rich diet of fiber which gives them the ability to support hundreds of end points in densely populated areas.

10. A network wide DHCP hands out one set of IP addresses to any device that connects to this huge network of 10 to 15 thousand end points. However, these IPs are not routed and are of no direct use to the average end customer.

11. A home grown VPN client than connects a VPN concentrator at the DCN HQ to get a functional IP address which is either a real globally routed IP address or an IP address that is recognized by one of the many proxy servers in the DCN HQ and lets the user access the Internet.

12. Non-paying customers are denied access to the VPN box until the payment is received traversing the chain mentioned above (Junknet - Aggregator - HQ).

13. It is common for the end uses to download pirated movies and software from the file servers managed by the DCN HQs. Users expect these downloads to take place at around 4 to 5 MB per second and when this goes down below 2 MB per second, the users actually complain against the service to their operator.

14. As a DCN approaches higher number of users and buy bulk bandwidth (most that I know are running STM1 or multiple STM1s for transit capacity), the statistical multiplexing effects gets stronger and end users' experience gets better.

15. For Rs 600 ($8) per month, users of these DCN generally get a service upwards of 512 kbps in middle class localities.  The DCNs often do not explicitly cap the throughput. At times, when the load is less, users get to enjoy multi-megabit Internet access. However, of late, with better traffic shaping techniques being cheaply available to the DCN operators, some permanent traffic policing is being witnessed. This is managed at the DCN HQ.

16. The cable systems running these DCNs - the fiber or cat5 cables atop utility poles - are not governed by regulations of either PEMRA (Pakistan Electronic Media Regulatory Authority) or PTA (Pakistan Telecommunication Authority) as both bodies find the operations lying in the middle gray area. PTA deals with the formal, tax paying and well organized ISP and Telecommunications industry while PEMRA deals with the TV cable systems that, at the edge, depend on the coaxial cable running atop utility poles to reach their end users. The fiber that takes the DCNs from one locality to another locality (with the PC routers as bridges between them and the junknets) runs along with these TV channel cables.

And from a subsequent email answering some additional questions:

2. There is a tremendous potential for DCNs to peer, at least in the cities. The trump card here, again, is the near universal availability of fibers-on-the-poles which can allow DCN HQs to peer at multi gigabit speeds. However, the biggest challenge is not technological unfortunately. The biggest challenge is that the DCN top-guys are yesteryears street roamers and getting them to digest the idea of putting a dedicated switch (vs a PC based multi Ethernet port aggregator) is tough beyond expectations. Telling them why peering is important and the subsequent marvels this will bring in is like explaining a fine color shade to <someone> born blind. I've had personal experience in this respect.

3. Pakistan is paying through its nose for the Internet Transit it buys for its population. As a country, it is estimated that Pakistan subscribes to around 10 GB of Internet transit.  For operators like my employer, STM1 costs in the vicinity of USD 23,000 per month and STM-4 transit capacities in the vicinity of USD 65,000 per month. In Pakistan, where broadband penetration is just 170,000 broadband connections (BB is defined as anything above 128 kbps), there is a huge potential <demand for> domestic bandwidth which is just not being taken care of. The entire country is depending on what I insist to call 'imported Internet' and there is no way this model can scale if we are to touch a few million broadband users by the next 18 months.

4. Asymmetry sometimes comes into play because some DSN have HFC cablenet and/or DSL connection bundles as their upstreams or backups. When these are in play, the upstream performances get bad.

Open right-of-way leads to FTTH galore in Bucharest

Esteemed reader Jim Van Meggelen was in Romania last summer, in part because both the YATE and OpenSER/OpenSIPS/Kamailio open source projects are based in Bucharest.  That's fascinating, but look at what else he found, Fiber to the Home - a lot of it!

To quote Jim:

I was in Romania this summer and they had a fascinating approach to the last mile: run your own fibre. It was really funny to see the massive numbers of fibre strands running all over Bucharest, hung willy-nilly from lampposts, power poles, balconies, traffic signals, weather vanes, and pretty much any structure that one could figure out a way to attach a cable to. Messy? Yes. Unregulated? Effectively, yes (you simply sneak up the pole late at night). The upshot of all this is that most of the urban centres in Romania have massive amounts of bandwidth right to the residence. It is common to be able to download data as fast as the NIC in the PC is able to consume it. They have access to last-mile bandwidth that we in North America can only dream of, for the same cost as we get DSL.

  Here's some more local color from one of Jim's later emails:

Pretty much all the cables you see in that picture are fibre.

Given the fact that Romanians don't have much respect for authority (which is probably true of most former-Communist countries), the concept of anyone owning the last mile is not something I think is given much thought. They've got a lot of worse problems to sort out before they worry about that sort of thing. It is fascinating to see them taking their economy from Communist through corruption to Western. I am no economist, but my gut feeling says they're on the right track.

The locals feel that all that cabling is an eyesore, but what is far more funny is to see a rusted out Dacia on cinder blocks, parked right next to a brand new Ferrari, and then an old Trabant ready for the scrapyard, flanked by an Aston Martin or similar. Bucharest is a bit of a mess, but not in a way that is unpleasant. For some reason it reminded me of a Mexican city somehow. I'm not sure why. It is certainly not an ugly city (at least not to my eye), but it is clear that they have a long ways to go, yet.

The Romanian people are wonderfully polite and generous, although they seem surprised that anyone would want to visit their main city (they laughed when I asked where to go to get Bucharest souvenirs). They have a fantastic sense of humour, but at first they seem a little stone-faced. What was a really pleasant surprise was that since Romanian is a Latin language, anyone with a passing French, Spanish or Latin vocabulary stands a fair chance of reading much of the signage and such.

Romania was not on my list of places I wanted (nor expected) to visit. I ended up there because both the YATE and OpenSER/OpenSIPS/Kamailio projects are based in Bucharest, and I was doing some writing on those projects, so I figured a trip out there was in order. Although the list of places I have yet to visit is fairly long, Romania is a place that I would be happy to visit again.

Regards,
Jim

Strangely, Bucharest's do-it-yourself fiber reminds me of mobile service providers in Somalia, a country with no central government and no regulation of radio spectrum.  None-the-less, Somalia has multiple GSM service providers who share standard GSM frequencies in semi-cooperative fashion.  In each case there is no law enforcement, yet people work out ways of coping, and of arbitrating disputes.  Likely this is what common law was before it became Common Law.

African telecom: corruption mostly limited to publicly run operators

The latest issue (#421) of Balancing Act News Update has an interesting story based on the prosecution (in the US) of former sales agents for ITXC found guilty of bribery in arranging VoIP connectivity contracts.

Six of the seven telcos involved were state owned businesses and in the one with private ownership (Sonatel, the PTT in Senegal that's partially owned by France Telecom), it was France Telecom that got suspicious.  Balancing Act News goes on to point out the problems with bribery:

It will be clear from the summary of the available public documents that this approach to business has a number of pitfalls. The bribed employees in two instances subsequently had to sort out “cost disputes” which were the pretext for asking for more bribes. In one instance, the bribed employee failed to share his gains with the managing director. In the only company with a private shareholder (which also sells wholesale minutes), the bribed employee became isolated under commercial questioning: this provides a strong if not always decisive argument for privatisation.

Based on their conclusion, it appears there is no viable way to do business with the state controlled Telcos in Africa:

From the telco side, what has been known privately for years is now revealed clearly and publicly by the Rwandatel and Sotelma examples. Corruption is systemic and goes right to the top and bribes are expected to be shared with the boss of the organisation and woe betide anyone who tries to keep the money to themselves.

Luckily, the mobile telecom industry in Africa is mostly private and increasingly competitive, with the result that mobile phone adoption is soaring in Africa.  It would be nice to think the PTTs will be cleaned up, but in any event, the benefits of telecom are reaching African citizens via mobile phone services.

Asian innovation in mobile social networking

I'm continually amazed at the East-West cultural gap (that's between Asia and the US/EU, not between Boston and Silicon Valley).  It goes both ways, but as an American Internet and mobile enthusiast with Asian connections, I'm usually struck by US ignorance of Asian Internet and mobile services.

Today, China has the worlds largest mobile population and the worlds largest Internet population.  Korea is a leader in high speed broadband, as is Japan.  Japan is also the #2 economy in the world and arguably the world's leading mobile society.  Surely it's worth the time to understand what's happening in their markets!

For a change, over the weekend, I stumbled on an excellent presentation, What Asia can tell us about mobile social networks, from O'Reilly's conference, Graphing Social Patterns East, held in June in Washington DC.  The presenter was Benjamin Joffe who resides in Beijing where, among other things, he's the founder of Mobile Monday Beijing.

Some of his numbers may be a year old, but the impact is clear.  Asian services like QQ (740M registered users), CyWorld (used by 90% of young Koreans) and Mixi (10M mobile users in Japan) typically started before Facebook, have many more features, and are profitable!
Here's Benjamin's features list:

Check out the entire presentation.  Well worth the effort!

Cultural Stew

Just back from dinner in Bangalore.  It was fine, but it was a truly bizarre cross cultural experience.  My main course dish was described as:

Creole spiced roast chicken served with stir fried vegetables and tumeric tempered spagetti.

Desert was:

Nutty pistachio mouse flavored with tequilla.

The red wine was from a Shiraz grape but grown and fermented by the Sula wineries in Maharashtra, India.

The restaurant was on the 10th (the top) floor of a hotel in one of the taller buildings in Bangalore.  It emphasised Cajun food, however the waiters and waitresses were all wearing cowboy hats mimicking a Texan tourist restaurant.

This was a far contrast to my first trip to Bangalore (2003?) when we traveled down a dirt alley to a local restaurant serving south Indian cuisine and then went to a different local restaurant for specialty deserts.

The biggest change in the past year is the opening of a new airport, some 35 km away from central Bangalore.  The new airport is nice, the highway is plausible, but traffic remains a problem.  Too bad they didn't contract for a high speed rail link at the same time.

Off to Hyderabad in the morning...