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Report No: AUS0000215
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Western Africa
ECOWAS Regional Communications:
Toward Integration of Infrastructure and Services
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August 13, 2018
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Digital Development Department
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© 2017 The World Bank 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved
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3
Executive Summary Advancements in the provision of communications and data services are providing the West Africa region
with new approaches not only for people to communicate and access information, but also for the
facilitation of trade, financial transactions, and service delivery (such as entertainment, digital learning,
and telemedicine). The digital space is becoming an industry in its own right, disrupting traditional
business models and providing new economic opportunities, especially for youth. A new dimension of
regional integration and pathway for the regional digital economy is fast emerging.
Global experience shows that the pursuit of a regional digital economy is multidimensional and requires
significant coordination and concerted effort by member states. Regional communities in Asia and Europe
have launched dialogues and programs on creating a “digital single market” in their respective regions
(figure ES.1). While the end goal of the digital single market concept is a seamless online market where
efficiencies are promoted, it requires the development of foundational layers to support such a market.
At the base of the foundation is the communications infrastructure or the single connectivity market,
which increasingly consists of fiber optic backbone networks with high-capacity bandwidths and capillary
networks, including FTTx 1 and 3G, 4G, and 5G mobile networks. The focus of this study is on this
foundation, to examine the status of the connectivity market to identify the bottlenecks in the
development of regional communications. The study provides recommendations in the context of
advancing the regional integration and regional digital economy agenda in Western Africa.
Figure ES.1. Digital Single Market Foundations
Source: World Bank.
Status of International and Regional Connectivity
In the past decade, the West Africa region has witnessed significant advancements in the provision of
communications and data services. With the arrival of new international bandwidth capacity through
submarine cable systems, the cost of international bandwidth has come down, in some instances by 50-
80 percent. West African countries have continued to open the mobile market for competition, and today
there are more than 320 million mobile subscribers in the Economic Community of West African States
(ECOWAS) region alone. These advancements have shown significant impact; however, the uptake of
Single connectivity market
Single data market
Single
online market
▪ Ensure data protection and privacy laws
allow cross-border data transfers
▪ Share cybersecurity resources in region
▪ Remove cross-border barriers to
infrastructure and connectivity
(wholesale and retail)
Remove Cross-Border barriers
▪ Ensure e-commerce, digital services and the functions
that support them all work across borders
▪ Remove trade and customs barriers for goods
purchased online
Promote Digital Market
▪ Where relevant, create scale for
these analogue complements
across the region
▪ Digital ID
▪ Digital payments
▪ E-transactions
▪ Consumer protection
▪ Data protection and Privacy
▪ Cybersecurity
▪ Content regulation
▪ Infrastructure
▪ Services
Digital
Skills
Innovation
environ-
ment
Hard infra’
(e.g.
power)
Capital
FinancingEnabling
environment
Digital
leadership
▪ Digital public services
▪ Trade & customs
▪ Logistics
4
broadband Internet services in West Africa has experienced slow growth (figure ES.2). Faster growth in
this area will be needed to fuel the digital economy.
Figure ES.2. Mobile Internet Subscribers as a Share of Total Mobile Subscribers, 2010–18
Source: GSMA Wireless Intelligence. Note: Data for 2017 and 2018 are forecasts.
There is already significant physical cross-border connectivity in the region: all but four of the ECOWAS
states have a fiber optic cable network that interconnects physically to an adjacent country. However,
these interconnections are primarily used for voice communication, and there is a lack of internet
protocol connectivity for data transmission. This suggests a possibility that the existing infrastructure is
not being fully utilized for cross-border data transmission. Further, the region still lacks Internet
exchange points (IXPs) and data centers, which can help regional communications traffic to remain
within the region. Without these exchange and storage capabilities, regional traffic often must transit
through a European city. This adds to the transit cost, and increases the possibility of latency increases,
which both impacting the end-consumers.
In addition to the national digital infrastructure development taking place across member states, there
are further opportunities to leverage alternative infrastructure projects—energy transmission, railways,
roads, and so forth—that carry fiber optic networks across the region. Entry of alternative infrastructure
operators in the wholesale telecommunications market can stimulate competition and instantaneously
add significant regional capacity, but requires extensive efforts at the national and regional levels to
develop the necessary legal, policy, and regulatory environments.
Traditionally, legal and regulatory frameworks with a national focus have been developed in countries in
the region, primarily driven by mobile-focused interests. Thus, although domestic mobile markets have
flourished over the past decade, a regional vision for data or broadband connectivity has been missing.
Cross-border interconnection is primarily used to facilitate voice calls on mobile roaming. Furthermore,
0%
10%
20%
30%
40%
50%
60%
70%
80%
2010 2011 2012 2013 2014 2015 2016 2017 2018
Western Africa Eastern Africa Middle Africa Northern Africa Southern Africa
5
there is limited competition, with four pan-regional operators in West Africa that offer wholesale
services in the West Africa region and about 10 other providers that provide limited cross-border
connectivity. Due to the geographic size of the region, there is little overlap of the networks; hence, they
consist of clusters of single-operator markets. There are several regulatory bottlenecks to regional
communications:
• Regional licensing of operators. Currently in the ECOWAS region, an operator licensed or
authorized as an operator in a member state is not recognized in other member states.
• Open access policy, especially for dark fiber. Open and fair access policies for backbone
infrastructure running through a country and cross-border to another country are largely
missing.
• Infrastructure sharing and colocation. Specific regulations or guidelines for access to the core
network by other network operators are lacking. These include guidelines on sharing masts and
poles, spaces in buildings with termination and switching equipment, ducts and so on.
• Dispute resolution. In many ECOWAS member states, there are currently no specific provisions
allowing operators established in an ECOWAS member state to settle a dispute with an operator
in another member state.
Furthermore, the lack of a regional outlook to the development of the communications market in
ECOWAS has led to an absence of a framework for regional wholesale pricing. This is evidenced by the
limitation of Reference Interconnect Offers (RIO) to national operators only and no explicit offers for
access to cross-border interconnection points were found.
Low-Cost International Mobile Roaming: Boosting Consumer Welfare
The communications market in Africa still relies heavily on 2G voice services, constituting 55 percent of
total subscriptions, but this is projected to decline to 10 percent by 2023.2 Internationally, regional
economic communities have leveraged the digital sector to strengthen regional economic integration,
while also promoting consumer welfare through increasing the affordability of services, including the
reduction and eventual elimination of roaming charges.
A reduction or abolishment of roaming tariffs would constitute a reduction in operator revenues in the
medium term. However, it would create a large consumer surplus—by one estimation amounting to
US$775 million over the next four years for the region.3
Globally, regional roaming initiatives have been met with varying degrees of success and have followed
different approaches. However, a common outcome across all initiatives is a significant increase in
roaming usage, which can be seen as an indicator of the consumer surplus. In Kenya, for example, the
volume of calls went up by 264 percent when regional roaming rates were abolished.4
There are a total of 21 mobile operators in the ECOWAS region serving the 320 million subscribers, with a high degree of market concentration between the top 5 operators. Roaming prices offered by operators in the region are highly heterogeneous across countries, operators and visited countries, varying by over 10 times for the same type of voice call, depending on the roaming location for subscribers of the same home network. The same spread is also observed for data traffic with the price of 1 MB of roaming data
6
usage varying from US$ 0.08 (MTN Liberia within the MTN zone) to US$ 60 (Airtel Ghana roaming in Senegal).
In addition to the high heterogeneity in roaming prices across the region, the prices are generally high—
in absolute terms - and this comes to the forefront when average prices across the region are compared
with regulated prices in Europe, the Gulf Cooperation Council, or East Africa. The price for a call to home
made in ECOWAS is 23 times higher than in Europe, and that for data roaming in ECOWAS is 65 times
higher than in Europe.5 Furthermore, roaming prices are considerably higher when compared to domestic
prices, a differential that cannot be solely attributed to costs associated with roaming.
The wholesale markets in the region display similar trends as the retail markets. The roaming market is
comprised of retail and wholesale components, at the domestic and international levels. In addition to
operating costs, such as network and signaling costs, a roaming call incurs certain tariffs, which are high
compared with those in other regions and vary significantly within the region.
Roaming regulation aims to develop the retail market to maximize utility for consumers and profit for
operators. However, other aspects, such as incentives to invest or eliminating fraud and arbitrage that
can arise in international traffic, should be considered as well. The evolution of international roaming in
four regions shows broadly two approaches:
• Voluntary, private sector–led models in East and Southern Africa
• Purely regulated models in the European Union and six Gulf Cooperation Council countries.6
Some of these measures may be taken unilaterally by a single country; others may be implemented
between two or more countries7 or applicable within a regional economic community. Examples of the
different categories of regulatory intervention available to national and regional regulatory bodies are
noted in table ES.1. The International Telecommunication Union is currently pursuing an initiative relating
to the decrease of international roaming prices under the ITU Global Dialogue on International Mobile
Roaming—Let’s Roam the World.8
Table ES.1. Range of regulatory options
Option range Example
Light regulatory intervention Improve customers’ understanding of roaming prices
Beyond some financial threshold, submit the pursuit of roaming services to obtaining the expressed consent of the customer
Intermediary regulatory intervention
Retail price cap and often wholesale price cap
Extensive regulatory intervention Unbundling of roaming services from national services
7
Recommendations and Conclusions
Economies of scale and network effects are critical for driving the growth of the digital economy,
starting from telecommunications infrastructure and services. This is particularly pertinent for several of
the ECOWAS countries that are too small in isolation to pursue development of a digital economy. And
most individuals in the ECOWAS region remain disconnected from the Internet. In addition to the large
size of the region, its inherent heterogeneity further increases the importance of developing subregional
linkages. For example, the West African Economic and Monetary Union offers an opportunity for a
subset of ECOWAS member states to forge stronger partnerships in developing their digital economies.
Yet, there are overarching principles to which all countries should adhere, including on their borders:
• Regional licensing. The shift from national to regional licenses for operators, including
alternative utility and transport operators, could accelerate regional expansion and potentially
draw more competition into parts of the region.
• Liberalization and competition. There are likely to be instances where there will be natural
monopolies, particularly the long-distance wholesale providers (or carrier’s carrier). The region
currently lacks frameworks for competition policy and significant market power regulation,
which has led to a situation where dominant behavior is largely left unchecked.
• Open access and infrastructure sharing. Policies and regulations that promote the use and
sharing of infrastructure, including infrastructure sharing, rights of way, and colocation, would
encourage efficient use of infrastructure and allow smaller operators to participate in cross-
border communications. This would also include the alternative infrastructure providers.
• Transparency of tariff information. Increasing the visibility of retail prices would protect
consumers from bill shock and could encourage the use of cross-border communications.
Transparency of wholesale prices (reference interconnection offers) together with the other
open access principles could be catalytic for the efficient utilization of infrastructure.
• Harmonization of sector laws, policies and regulation: Adopting a regional outlook to digital
infrastructure, as well as services such as mobile roaming, requires harmonization of the sector
across the region. This first entails addressing underlying inefficiencies in national markets.
• Aggregation and localization of content. In parallel to easing voice and data traffic across
borders, the region would benefit from keeping regional traffic regional. Even countries that do
not have robust and secure data infrastructure, such as IXPs and data centers, could host their
content in another country in the region that has these capabilities.
• Capacity building of regulators. The ECOWAS member states are on different rungs of the digital
economy ladder, much of which depends on the size of the market, but also the capacity of the
relevant institutions. The transposition of the regional supplementary acts, for example, can be
a complex process involving multiple agencies, laws, and regulations. Capacity building of
regulators and other agencies would be needed in areas such as licensing and pricing
regulations.
A collaborative approach to the digital economy would help deepen existing socioeconomic ties and
circumvent the potential widening of the digital divide between countries. The region has seen
8
significant investments in infrastructure, but further deployment is required to achieve universal
coverage objectives and reinforce the robustness of regional networks. The next challenge is to get the
enabling environment right for voice and data transmission across borders. This would lay the
foundation for producing digital content that is pertinent to the people and businesses of the West
Africa region—digital government services, financial services, entertainment, and innovation.
9
Abbreviations and Acronyms ACE African Coast to Europe ASN autonomous system number COMESA Common Market for Eastern and Southern Africa CSLG Côte d'Ivoire, Sierra Leone, Liberia, and Guinea Countries Electricity Networks
Interconnection CRASA Communications Regulators Association of Southern Africa EAC East African Community ECCAS Economic Community of Central African States ECOWAS Economic Community of West African States EU European Union GCC Gulf Cooperation Council ICT information and communications technology IMR international mobile roaming IOT inter-operator tariffs IP Internet protocol ITR international termination rate ITU International Telecommunication Union IXP Internet exchange point LTE Long-Term Evolution MB megabyte Mbps megabits per second MNO mobile network operator MoU memorandum of understanding MRU Mano River Union MTR mobile termination rate NCC Nigerian Communications Commission OECD Organisation for Economic Co-operation and Development OECS Organization of Eastern Caribbean States ONA One Network Area PPP purchasing power parity RIO reference interconnection offer RWG Roaming Working Group SADC Southern African Development Community SAT-3/WASC South Atlantic 3/West Africa Submarine Cable SMP significant market power SMS short message service UMA Arab Maghreb Union WAEMU West African Economic and Monetary Union
10
Table of Contents
Contents Page No.
I. Introduction 11
II. Status of International and Regional Connectivity 15
International Connectivity 15
Cross-Border, Terrestrial Fiber Optic Connectivity 16
Alternate Infrastructure Carrying Fiber Cables 17
Low Development of Internet Protocol Connectivity and Local Content Hosting 18
Regulatory Barriers to Cross-Border Use of Existing Infrastructure 21
Recommendations 28
III. Low-Cost International Mobile Roaming: Boosting Consumer Welfare 31
Potential for a Regional International Roaming Regime 32
Current State of International Mobile Roaming within ECOWAS 36
Potential Barriers to Affordable Regional International Roaming 41
Lessons from Regional Roaming Experiences 47
Recommendations 56
IV. Conclusion 57
11
I. Introduction In the past decade, the West Africa region has witnessed significant advancements in the provision of
communications and data services. With the arrival of new international bandwidth capacity through
submarine cable systems, the cost of international bandwidth has come down, in some instances by 50-
80 percent. West African countries have continued to open the mobile market for competition, and today
there are more than 320 million mobile subscribers (of which 176 million are unique) in the Economic
Community of West African States (ECOWAS) region alone. The number of smartphone connections has
doubled in the past two years to 112 million. Although 65 percent of these connections are still largely
driven by 2G voice services, it is estimated that mobile broadband connections will grow from 35 to 95
percent by 2025.9
These advancements provide new channels not only for communication and accessing information, but
for the facilitation of trade, financial transactions, and service delivery (for example, entertainment, digital
learning, and telemedicine). There are more than 50 active mobile money services in the region, with
104.5 million mobile money accounts, which generated transactions amounting to US$5.3 billion in
2017.10 The digital space is also becoming an industry in its own right, disrupting traditional business
models and providing new economic opportunities, especially for youth. This is further evidenced by the
presence of more than 140 active tech hubs in the region. A new dimension to regional integration, and
a new pathway to a regional digital economy, is fast emerging.
However, global experience shows that the pursuit of a regional digital economy is multidimensional and
can require significant coordination and concerted effort by the member states. Recognizing this, regional
communities such as the Association of Southeast Asian Nations and European Union have launched
dialogues and programs on creating a “Digital Single Market” in their respective regions. The vision of the
Digital Single Market concept is a seamless online market (figure 1) where barriers to social and economic
interactions are reduced and efficiencies increased. The single online market is supported by foundational
layers, including an enabling data environment or the single data market that is needed to safeguard the
transition to an increasingly data-focused economy by establishing robust frameworks for cybersecurity,
data protection, and combating online fraud.
Another foundational building block is the communications infrastructure or the “single connectivity
market,” which increasingly consists of fiber optic backbone networks with high-capacity bandwidths and
capillary networks, which include FTTx11 and mobile networks. The focus of this study is on the very
foundation on which the digital economy would sit—the communications infrastructure or connectivity
market in the ECOWAS region. The study examines the status of the connectivity market to identify
bottlenecks to the development of regional communications and provides recommendations in the
context of advancing the regional integration and regional digital economy agenda. Since mobile
broadband is the primary mode of connectivity access in West Africa, the second part of the study focuses
on regional international mobile roaming as a service that leverages cross-border linkages of digital
infrastructure. Additionally, the dominance of 2G voice services in the region makes international roaming
a pertinent use-case for studying the telecommunications market at the regional level.
12
Figure 1. Digital Single Market Foundations12
Source: World Bank.
Currently, intraregional trade, as a percentage of total trade, ranges from 2 percent (Cabo Verde) to 60
percent (The Gambia), with an average of 9 percent among West African countries.13 Migration data
reveal that 64 percent of total migration in ECOWAS is internal to the region, following varying routes and
patterns across countries. This points to the heterogeneous landscape of West Africa, which consists of
overlapping groups of communities and markets. As in other sectors, language plays a key role in the
subdivision of the region, with Anglophone, Francophone, and Lusophone countries forming the
overarching groups. It is largely in this context that the telecommunications markets have developed,
servicing markets largely based on the three languages.
Yet, there are other considerations that would need to be taken into account to move toward a regional
digital economy in an inclusive manner. About 80 percent of the population in the ECOWAS region lives
in rural areas, and many of the telecom operators are still focused on increasing subscriptions in urban
centers close to the international submarine cables along the coastline. Communities based on common
languages across the region also form boundaries. For example, the Hausa-speaking area stretches 800
kilometers from northern Ghana to Chad and straddles eight countries in West Africa. Fulani herdsmen
and seasonal workers between Burkina Faso and Côte d’Ivoire cross national borders every year, which is
illustrated by the many mobile money transactions along the routes taken. The challenge for the region is
to chart a course toward seamless communications connectivity.
This has been an age-old challenge that has required many revisions to the approach taken to ease and
increase cross-border communications—namely, due to the rapid and continuous evolution of
communications technology as well as the increase in private participation in the sector. One of the
earliest regional telecommunications projects was Intelcon I, which was launched in 1984 and ended in
1994 with the completion of 13 interstate telecommunications copper cable links. Intelcon II, launched in
1997, focused on extending connectivity in urban areas and between the capital cities. Around 2010, the
West Africa region saw another surge in investments in large-scale fiber optic cable infrastructure to
facilitate international and cross-border communications. This last phase of investments saw an increase
Single connectivity market
Single data market
Single
online market
▪ Ensure data protection and privacy laws
allow cross-border data transfers
▪ Share cybersecurity resources in region
▪ Remove cross-border barriers to
infrastructure and connectivity
(wholesale and retail)
Remove Cross-Border barriers
▪ Ensure e-commerce, digital services and the functions
that support them all work across borders
▪ Remove trade and customs barriers for goods
purchased online
Promote Digital Market
▪ Where relevant, create scale for
these analogue complements
across the region
▪ Digital ID
▪ Digital payments
▪ E-transactions
▪ Consumer protection
▪ Data protection and Privacy
▪ Cybersecurity
▪ Content regulation
▪ Infrastructure
▪ Services
Digital
Skills
Innovation
environ-
ment
Hard infra’
(e.g.
power)
Capital
FinancingEnabling
environment
Digital
leadership
▪ Digital public services
▪ Trade & customs
▪ Logistics
13
in private participation and entry of other utilities into the market carrying fiber along their networks
(power grids and railroads).
These investments and projects ran parallel to several fruitful regional integration initiatives, such as the
free movement of persons, goods, and services between the countries in ECOWAS and the free trade
agreements and single currency under the West African Economic and Monetary Union. The vision for
free movement of communications and its role in the further advancement of the regional integration
agenda have been echoed and supported by regional and donor entities such as the African Union, African
Development Bank, International Telecommunication Union, Islamic Development Bank, and World Bank
Group. A significant body of work on the policy, legal, and regulatory frameworks has been developed to
guide the sector’s development, including the enabling environment for private participation and
competition.14 The results of the concerted efforts led to the weaning-off of costly satellite services
through increased international submarine cable connectivity and increased competition in the mobile
market. This has subsequently led to increased uptake of mobile phone services, as is being experienced
in other regions on the continent (figure 2).
Figure 2. Total Unique Mobile Subscriptions, 2008–18
Source: GSMA Wireless Intelligence. Note: Data for 2017 and 2018 are forecasts.
Although these figures show an impressive upward trend, the uptake of broadband Internet services is
showing a slower trend in growth. Figure 3 shows the percentage of mobile Internet subscribers
(smartphones and tablet devices) as a share of total unique mobile subscribers. The figure shows that
West Africa in particular is experiencing slow growth. Demographic factors, such as income level and
geographic location, are likely hampering uptake in the West Africa region as opposed to Southern Africa,
which has higher average income (figure 4).
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
160,000,000
180,000,000
200,000,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Southern Africa Middle Africa Northern Africa
Eastern Africa Western Africa
14
Figure 3. Mobile Internet Subscribers as a Share of Total Mobile Subscribers, 2010–18
Source: GSMA Wireless Intelligence. Note: Data for 2017 and 2018 are forecasts.
Figure 4. Factors for the Within-Country Digital Divide in Africa
Source: World Development Report 2016, Digital Dividends.
In terms of cross-border communications, the numbers available are also concerning. Most data or
Internet traffic that originates from and is terminated in the West Africa region is routed through a
European city. This adds to the transmission cost, which is then passed to the subscriber, and it increases
the chance of network latency. Moreover, this is a missed opportunity for local and regional telecom
operators to keep the regional market regional, and for local data centers and other digital platform
providers to store and manage local data and content as a business. Furthermore, mobile roaming within
the region is low, with roaming minutes constituting 0.03 percent of total traffic in the region’s largest
0%
10%
20%
30%
40%
50%
60%
70%
80%
2010 2011 2012 2013 2014 2015 2016 2017 2018
Western Africa Eastern Africa Middle Africa Northern Africa Southern Africa
15
market, Nigeria. The reasons for this may include limited social and economic activity at some of the
national borders, but an evident challenge is the high price of roaming charges, which can lead to “bill
shock” when the subscriber has a negative reaction if their phone bill has unexpected charges. This
situation is symptomatic of the lack of a regionally focused policy framework that would address the
bottlenecks to the cross-border use of the infrastructure and provision of services. Other regional
experiences, such as in the European Union and Arabian Peninsula, have shown that the pursuit of an
integrated communications market is a long one, but real impact is observed at each milestone.
Based on the aspirations of West African regional bodies to move toward a single connectivity market and
subsequently a regional digital economy, this study aims to identify the key bottlenecks in the
development of regional communications. The study focuses on two segments of the communications
value chain, starting with the wholesale backbone networks that carry traffic across borders and then
examining the status of the regional roaming market to assess how roaming fees affect cross-border
communications. Various aspects across the value chain (for example, tariffs and taxation) can also affect
other segments; hence, the study tries to identify those symptomatic issues that stem from the broader
sectoral challenges. The study draws from studies funded by the Public-Private Infrastructure Advisory
Facility15 that were conducted upon the request of the ECOWAS Commission. Although the data and
analysis focus on the ECOWAS member states, the recommendations reflect the needs of the wider West
Africa region.
II. Status of International and Regional Connectivity
a) International Connectivity
For international connectivity, all coastal countries in the ECOWAS region, except Guinea-Bissau, are served by international submarine fiber optic cable connections. Submarine cables are usually owned by a consortium of operators, with one or two large operators entrusted to manage and maintain the cable system. West Africa is largely connected through three consortiums, the South Atlantic 3/West Africa Submarine Cable (SAT-3/WASC),16 which became operational in 2001; Nigeria’s Main One17 cable system, which became operational in 2010; and the Orange/France Telecom–led African Coast to Europe (ACE)18 cable system, which first became operational in 2012. Burkina Faso, Mali, and Niger, being landlocked, do not have direct access to a submarine cable landing station. Currently, Mali and Niger are connected to the ACE cable system through Orange, and further backbone deployment is underway for Burkina Faso to connect to ACE.
In telecommunications, whether submarine or terrestrial, it is important to have options to route through several cable systems (redundant networks) in the event of a cable outage (map 1). Outages have been reported in West African countries in the past several years, which has left countries that have access to only one submarine cable system in a communications blackout, at times spanning a few days or a couple of weeks. Ghana, Côte d'Ivoire, and Nigeria have secure access to multiple submarine cable systems; Senegal is in a vulnerable position, as its alternate route includes an older generation of cable systems provided by SAT-3/WASC and Atlantis-II. Six countries do not have alternate submarine routes or competitive landing points, including Guinea, Guinea-Bissau, Liberia, Sierra Leone, The Gambia, and Togo. There is therefore a need to develop redundancy and competition for access to submarine cable systems to ensure reliable international connectivity.
16
Map 1. Submarine Cable Systems Connecting to Africa
Source: https://manypossibilities.net/african-undersea-cables/.
b) Cross-Border, Terrestrial Fiber Optic Connectivity
Currently, all but four of the ECOWAS states have a fiber optic cable network that interconnects physically
to an adjacent country. These networks consist of the “backbone” of the national communications
infrastructure, which is often treated as an essential facility—infrastructure that requires high investment
or sunk costs, which in turn may inhibit new entrants from coming in or would justify a natural monopoly,
depending on the market characteristics. The backbone consists of the wholesale market for reselling
capacity to retail operators, including mobile operators and Internet service providers. Map 2 shows that
all but Guinea-Bissau and Liberia have a national fiber optic backbone, and there are cross-border links at
most of the ECOWAS borders. Guinea and Sierra Leone have fairly extensive national backbones, through
self-financing in the case of Guinea and funding from the Islamic Development Bank in the case of Sierra
Leone.
17
Map 2. Regional Cross-Border Points
Source: “Missing Links and Infrastructure Sharing Study” prepared by a team of consultants: Claude de Jacquelot,
Mike Jensen, Bernard Sanchez, Rémy Fekete, Ananda Covindassamy, David Guitton, and Iheb Nomme.
c) Alternate Infrastructure Carrying Fiber Cables
Fiber optic cables are carried by other utility service networks, such as electricity grids and oil and gas
pipes, and are laid during the construction of railroads and highways. The fiber is used by the utility or
transport companies to communicate and manage their assets and operations, but this consumes very
little capacity. In countries with an enabling regulatory environment, these companies lease capacity as
would a wholesale telecom operator. Apart from Phase3 Telecom from Nigeria, which is a power company
that leases its fiber bandwidth capacity, there are two electricity projects underway that potentially could
provide communications services (wholesale):
• The Mano River Union (MRU) consists of Côte d'Ivoire, Sierra Leone, Liberia, and Guinea (CSLG),
which together kick-started the construction of a 1,303-kilometer electricity interconnector under
the Countries Electricity Networks Interconnection (CSLG) project in 2017. An African
Development Bank report on “Updating the MRU Countries Electricity Networks Interconnection
(CSLG) Studies for Deployment of Public Broadband Services” examines the potential use of the
excess capacity of the CSLG’s optical fiber to provide those missing national and cross-border links.
ACE
ACE
Sat-3ACE
WACS
Sat-3ACE
ACE
ACE
ACE
WACS
Sat-3ACE
Sat-3ACE
WACSMainOne
Glo-1
Sat-3ACE
WACSMainOne
Glo-1NCSCS
Sat-3WACSNCSCS
ACE
C de Jacquelot 2016
AtlantisWACS
18
The report concludes that there is significant potential to use the CSLG power transport cables to
interconnect the four countries.
• The development objective of the Organisation pour la Mise en Valeur du fleuve Gambie (The
Gambia River Basin Development Organization) Interconnection Project for Africa is to enable
electricity trade between The Gambia, Guinea, Guinea-Bissau, and Senegal.
Furthermore, the Blue line rail, which aims to connect Abidjan-Ouagadougou-Niamey-Cotonou-Lomé and
the proposed fiber optic cable to follow the route of the Algeria-Nigeria-Chad Trans-Saharan Road (Route
Trans Saharienne), could provide redundancy networks to reinforce connectivity between the landlocked
countries. However, there are two bottlenecks for the mentioned projects. First, the region in general
lacks a regulatory and licensing framework for pan-regional operators, including alternative infrastructure
operators; hence, they are unable to participate as a wholesale provider in the countries they transit.
Second, in the case of the two electricity projects, the West Africa Power Pool Secretariat has yet to
develop a viable business model on how the extra fiber capacity would be utilized and marketed to
operators in the countries they will operate in as electricity providers. The related policy and regulatory
barriers are further examined in the following section.
d) Low Development of Internet Protocol Connectivity and Local Content Hosting
Much of the communications traffic that is intended for another West African country first leaves the
region and transits through a European city before it reaches its destination back in the region. This adds
to the cost of the transmission, as it goes through an international or European service operator, which
can cause latency or time delay in signal exchange and is a missed opportunity for local and regional
operators to keep the regional market regional. The physical cross-border connectivity primarily carries
E1 cross-border links the are used by voice service providers, namely mobile operators, for international
connection and roaming. E1 links are configured to be dedicated to voice services and do not carry
enough bandwidth for the broadband Internet market. Map 3 shows the fiber optic cable or E1 capacity
that is open at the national borders allowing for cross-border voice communications.
The transmission of higher capacities (data or broadband speed Internet) across national borders is
usually not the responsibility of country policy, but is a commercial decision to enter an interconnection
agreement with another operator based on a “handshake.” This study found no formal arrangements
between any two ECOWAS countries to interconnect two main data or Internet protocol (IP) operators
whether it be telco operators, data centers, or other hosting businesses, indicating that the wholesale
operators are expanding their own infrastructure rather than entering interconnection agreements
(map 4). However, IP cross-border connectivity has been negotiated between landlocked countries and
their adjacent countries to facilitate traffic to and from the landlocked country to reach submarine cable
landing stations for international connectivity (Bamako, Ouagadougou, and Niamey).
19
Map 3. Networks Carrying E1 Capacity across Borders, 2016
Map 4. Cross-Border IP Connectivity, 2016
Source: “Missing Links and Infrastructure Sharing Study” prepared by a team of consultants: Claude de Jacquelot,
Mike Jensen, Bernard Sanchez, Rémy Fekete, Ananda Covindassamy, David Guitton, and Iheb Nomme.
C de Jacquelot 2016
ACE
ACE
Sat-3ACE
WACS
ACE
ACE
ACE
WACS
Sat-3ACE
Sat-3ACE
WACSMainOne
Glo-1
Sat-3ACE
WACSMainOne
Glo-1NCSCS
Sat-3WACSNCSCS
ACE
Sat-3ACE
AtlantisWACS
C de Jacquelot 2016
20
A key indicator of IP development is the number of autonomous system numbers (ASNs). Within the
Internet, an autonomous system is a collection of connected IP routing prefixes under the control of one
or more network operators. The African Network Information Centre is the Regional Internet Registry
for Africa and is responsible for the distribution and management of Internet number reSource in its
service region, which includes Africa and the Indian Ocean region. Figure 5 shows the breakdown of
ASNs for the continent, which indicates that while Nigeria is second in the number of ASNs after South
Africa, the rest of the West African countries require further IP development.
Figure 5. Number of ASNs, West African Countries
Source: African Network Information Centre (https://www.afrinic.net/en/services/statistics/as-numbers).
As regional traffic is being routed through Europe, websites, data, and digital content intended for local
consumption are also being hosted outside the West Africa region. These include government and
business websites focused on providing information and services to West African citizens and
businesses. Looking at the top 10 websites in five countries—Côte d’Ivoire, Ghana, Mali, Nigeria, and
Senegal—all are hosted outside Africa, namely in Europe. The number of websites that are locally
hosted is generally low in comparison with other regions (figure 6). Some of the reasons include the lack
of IP connectivity, lack of Internet exchange points (IXPs) through which content is cached and
exchanged between the local operators between their autonomous networks, and lack of data centers
to store securely large amounts of digital information and host it close to users so that the data
transmission costs are minimized.
Infrastructure for content exchange and storage therefore needs to be developed further. It is
envisioned that once this layer of content platforms becomes more prevalent and affordable, there
would be a surge in the creation of local content, whether it is for public services, entertainment, or
business. This situation is also a missed opportunity for the information technology companies in the
21
region to provide middle-layer services for content storage and creation. The African Union has funded
some IXPs across Africa at the national and regional levels. For example, there are more contributions to
Wikipedia from Hong Kong SAR, China, than from all of Africa combined, despite that Africa has 50 times
more Internet users.
Figure 6. Websites Hosted Locally, ECOWAS Member States
Source: Source: “Missing Links and Infrastructure Sharing Study” prepared by a team of consultants: Claude de
Jacquelot, Mike Jensen, Bernard Sanchez, Rémy Fekete, Ananda Covindassamy, David Guitton, and Iheb Nomme.
e) Regulatory Barriers to Cross-Border Use of Existing Infrastructure
Legal and regulatory frameworks have been developed in member states with a national focus and have
primarily been driven by mobile-focused interests. Resultantly, while domestic mobile markets have
flourished in the past decade, a regional vision for data or broadband connectivity has been missing. Cross-
border interconnection is also primarily used to facilitate voice calls on mobile roaming.
As table 1 shows, there is significant variation between member states across key legal and regulatory
areas in the existence of regulation/laws pertaining to these and other areas, as well as in their
implementation.19 For example, nonnational telecom operators cannot provide fiber infrastructure in
member states, except in the cases of Burkina Faso and Senegal, where it is possible on a reciprocity basis,
and in Guinea, where it is possible for telecom operators without national licenses to operate submarine
Nigeria; 1187
Senegal; 62
Ghana; 93
Côte d’Ivoire; 52
Burkina Faso; 44
Mali; 19
Benin; 14
Togo; 15
Mauritania; 22Cape Verde; 24
Guinea; 18
Gambia; 13
Niger; 12
Sierra Leone; 2
Liberia; 2
CEDEAO Nombre de sites Web hébergés (06 2016)
22
landing stations through an association or consortium. Similarly, the lack of harmonization of legal and
regulatory regimes around the provision of dark fiber, infrastructure sharing, and access reinforces the
national outlook toward the development of connectivity infrastructure, rather than regional. Although
the various ECOWAS Commission Supplementary Acts pertaining to information and communications
technology (ICT) addressing these concerns have been transposed into national regulation in most
member states, their implementation has been a challenge.
Table 1. Implementation of ECOWAS Supplementary Acts
Country Harmonization of policies
Access & interconnection
Legal regime
Numbering plan
Radio-frequency spectrum
Personal data
protection
Electronic transaction
Benin ✓ ✓ ✓ ✓ ✓ ✓ ✓
Burkina Faso
✓ ✓ ✓ ✓ ✓ ✓ ✓
Guinea-Bissau
✓ ✓ ✓ ✓
Cabo Verde
✓ ✓ ✓ ✓ ✓ ✓ ✓
Gambia, The
✓ ✓ ✓ ✓
Ghana ✓ ✓ ✓ ✓ ✓ ✓ ✓
Guinea ✓ ✓ ✓ ✓ ✓ ✓ ✓ Côte d'Ivoire
✓ ✓ ✓ ✓ ✓ ✓ ✓
Liberia ✓ ✓ ✓ ✓ ✓ ✓ ✓
Mali ✓ ✓ ✓ ✓ ✓ ✓ ✓
Niger ✓ ✓ ✓ ✓ ✓ ✓
Nigeria ✓ ✓ ✓ ✓ ✓ ✓
Senegal ✓ ✓ ✓ ✓ ✓ ✓ ✓
Sierra Leone
✓ ✓ ✓ ✓ ✓ ✓ ✓
Togo ✓ ✓ ✓ ✓ ✓ ✓ ✓
Source: GSMA/Detecon Consulting; World Bank consultant. Note: ECOWAS = Economic Community of West African States; WAEMU = West African Economic and Monetary Union.
All the coastal countries in the region, except Guinea-Bissau, have international connectivity through
submarine cables, and all but four countries have cross-border terrestrial interconnection. When
combined with the alternate Source of fiber optic infrastructure through utilities, transportation, and
energy projects, the region is well placed to begin developing a single connectivity market by better
utilizing the infrastructure that is available.
WAEMU directives Previous or existing laws/decrees or orders ECOWAS supplementary acts Domestication in progress
23
Increasingly, the bottleneck to the development of regional connectivity is not with infrastructure
constraints, but the lack of a regional framework of regulation and intergovernmental agreements. The
main shortcomings, which this section examines, are limited competition and cost effectiveness in the
supply of services. The following are the interrelated challenges for better infrastructure utilization at the
regional level:
i. Lack of Regional Competition in the Wholesale Segment
Four pan-regional operators in West Africa offer wholesale services in the region: Etisalat/Maroc Telecom,
Orange, MainOne, and Phase3 Telecom (table 2). About 10 others provide some cross-border
connectivity. Due to the geographic size of the region, there is little overlap of the networks; hence, they
consist of a cluster of single-operator markets. MainOne and Phase3 Telecom, two Nigeria-based
operators, operate in the same countries, namely, Nigeria, Benin, Togo, Ghana, Côte d’Ivoire, and Burkina
Faso. Advancement in cross-border communications is therefore being driven by the expansion strategies
of the individual operators. The four operators also provide retail services in the countries where they are
located. (The second part of this study examines the mobile segment of the market.)
Table 2. Main Wholesale Operators in West Africa
Etisalat/Maroc Telecom has developed a cross-border network through its acquisition or investment in operators in Benin, Burkina Faso, Côte d’Ivoire, Mali, Niger, Nigeria, and Togo (as well as other countries in other regions in Africa). Note: Etisalat has exited Nigeria.
Orange has built a regional platform through its acquisitions in Burkina Faso, Côte d’Ivoire, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Senegal, and Sierra Leone. In Senegal, Côte d’Ivoire, and Mali, Orange is the main player (in wholesale and retail), and it heads the ACE submarine cable consortium.
24
MainOne is a Nigerian company that began as the operator of the MainOne submarine cable and extended this terrestrially to Benin, Burkina Faso, Togo, and Ghana. MainOne is in the process of connecting Burkina Faso with Côte d’Ivoire.
Phase3 Telecom, a Nigeria-based wholesale telecom infrastructure provider, is connecting its fiber optic infrastructure running on power grid infrastructure in Nigeria to other ECOWAS countries, including Benin, Togo, and Niger, with ongoing plans to extend the network to Ghana, Côte d’Ivoire, and Senegal.
Source: “Missing Links and Infrastructure Sharing Study” prepared by a team of consultants: Claude de Jacquelot,
Mike Jensen, Bernard Sanchez, Rémy Fekete, Ananda Covindassamy, David Guitton, and Iheb Nomme.
At the national level, the number of de jure monopolies and instances of exclusivity have greatly decreased over the years, due to efforts driven by the ECOWAS member states. However, de facto monopolies or exclusivity remain in some countries for access to and/or the provision of national and international infrastructure (submarine landing stations and national backbone infrastructure). Additionally, there are instances where some rights are in practice reserved to a limited number of players, such as limited consortiums for access to international capacities. Such restrictions, which can concern various rights of way and permission for activities, are difficult to detect and identify, since they can result from provisions of licenses or authorizations that are not publicly disclosed. Such de jure and de facto monopolies and specific rights prevent other actors from accessing certain reSource and rights of way under optimal conditions, carrying out certain activities, or providing certain services that are paramount for the development of cross-border connectivity (such as access to/provision of international and national capacities). De jure monopolies and specific rights are contrary to ECOWAS legal provisions, since Article 9.1 of the Supplementary Act A/SA. 3/01/07 on the Legal Regime Applicable to Network Operators and Service Providers provides that “Member states shall refrain from granting licenses with exclusivity or special rights, except when mandated by the country's policy or legislation, when dictated by the unavailability of necessary reSource or other relevant reasons.”
Furthermore, there is a general lack of guidelines and implementation of existing guidelines on how to
address significant market power (SMP), that is, operators that are in a dominant position within a
geographic area and able to price services over the marginal cost, among other aspects. For example,
under the current European Commission Directives, an operator identified to have SMP is subject to
“specific obligations such as the requirement to produce a reference interconnection offer and the
obligation to have cost-oriented tariffs (except for mobile operators).”20 According to the Organisation for
25
Economic Co-operation and Development (OECD), an operator is presumed to have SMP if it has more
than 25 percent of a telecommunications market in the geographic area in which it is allowed to operate.21
Article 19.2 of the Supplementary Act A/SA. 2/01/07 on Access and Interconnection in Respect of ICT
Sector Networks and Services requires the ECOWAS Commission to publish (i) guidelines for market
analysis and assessment of market power and (ii) a recommendation on relevant markets in products and
services in the telecommunication sector that can be regulated ex ante. The wholesale market has a direct
impact on the prices offered to individual and institutional consumers. As figure 7 shows, the cost of
international bandwidth varies extensively within the region and, in certain cases, a bulk of that cost is for
terrestrial bandwidth in the country and not for international connectivity to Europe.
Figure 7. Price of International Bandwidth (US$/Mbps/month)
Source: “Missing Links and Infrastructure Sharing Study” prepared by a team of consultants: Claude de Jacquelot,
Mike Jensen, Bernard Sanchez, Rémy Fekete, Ananda Covindassamy, David Guitton, and Iheb Nomme. Note: Mbps
= megabits per second.
The impact of SMP is worse for landlocked countries that need to route traffic over terrestrial networks
and through cross-border points of interconnection to gain access to international capacities. The price of
international bandwidth is between 1 and 4 percent of total cost (figure 8), depending on the route taken
to access a submarine landing station, and the rest of the cost is incurred in accessing terrestrial backbone
networks.
0
200
400
600
800
1000
1200
Eu c
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Africa : Price of international bandwidth Mbps/month/$ (country-EU)Prix de la bande passante internationale ($/Mbps/mois)
Western Africa
26
Figure 8. Mali’s Costs for Accessing International Bandwidth
Source: Malitel
ii. Lack of Framework for Regional Wholesale Pricing
A reference interconnection offer (RIO) is an offer document setting out matters relating to the price
and terms and conditions under which a carrier will permit the interconnection of another carrier to its
network. The objective of the RIO is to promote competition and efficient use of existing infrastructure.
Several reference offer catalogs were collected and analyzed for this report. Eight offers for access to
national capacity (active and passive) and international infrastructure were gathered. In at least two
countries, Nigeria and Ghana, national and international bandwidth offers are not regulated. In
summary, the features of RIOs in the region are as follows:
• Among the various RIOs analyzed, all explicitly state that the offers are only intended for
national operators.
• There are no explicit offers for access to cross-border interconnection points.
• While most regulated offers propose colocation services at the national interconnection points,
none of them explicitly offers access to cross-border interconnection points.
• National capacity offers are not adapted to the much larger volumes required by cross-border
data transmission.
• Of the eight offers analyzed, only five propose offers for rates above 2 megabits per second
(Mbps), and two only provide prices on request.
• The offers of two RIOs available in six of the eight countries have large differences in access fees
and rental fees, and there is a lack of harmonized structure for RIO obligations across the region
(some are based on distance (kilometers) per month or year).
STM1 link is the minimum offer for a reasonable IP broadband or data link. It corresponds to the
connectivity of 1,500 fixed broadband access or 5,000-7,000 mobile device connections per day
4% 1%
1% 13%
95%87%
Côted'Ivoire Sénégal
InternationalBandwidthPrice StationtoMaliBorder MaliBordertoBamako
27
(smartphone or tablet). The main capacities at the backbone level are in billions of bits per second
and/or STM4/16/64 (backhaul and small backbone). Offers for bandwidth exceeding 2 Mbps are
available in a limited set of countries. Only three of the eight countries analyzed offer 1 STM1 for
national capacity. Operators negotiate and reach agreements among themselves for this level of
capacity, often through capacity swaps.
iii. Other Regulatory Enabling Environments Driven by National and Mobile-Focused Interests
The existing policy and regulatory frameworks at the national and regional levels (ECOWAS
Supplementary Acts) have largely focused on advancing national or domestic connectivity. There is
currently no formal framework for fostering optimal economic and technical conditions for regional or
cross-border communications. As a result, investments in completing cross-border or regional
connectivity remain insufficient, and there is a lack of competition for the provision of services based on
cross-border or regional infrastructure, which maintains nontransparent pricing of wholesale bandwidth
capacity that is unregulated.
Licensing of a telco operator. Currently in the ECOWAS region, an operator licensed or authorized as an
operator in a member state is not recognized in another member state. This applies to the operators of
alternative infrastructure (such as energy grids and roads), who currently have no status or rights
enabling them to participate in the rollout of cross-border or regional networks. In this respect, the
ECOWAS Supplementary Act on the Legal Regime Applicable to Network Operators and Service
Providers encourages member states to exempt some activities from a licensing requirement. However,
in practice, licenses remain necessary to provide basic telecommunications services (such as provision of
national and international capacities, or even provision of dark fibers) in most member states. Such
limitations are implemented through the specific requirement to be a national company to carry out
electronic communication activities. This requirement may be specified in the applicable law or
regulations, licenses and their related specifications, regulatory authorities’ websites, and so forth. As a
result, nonnational telecommunications operators that are willing to develop cross-border networks
cannot provide services in the other member states where such networks would be located.
The Supplementary Act on Access and Interconnection in Respect of ICT Sector Networks and Services
provides that “Member states shall ensure that the general regulatory framework for access and
interconnection incorporates the general community regulation principles foreseen for the
establishment of the West African Common Market, including non-discrimination between companies
established in different States.” Likewise, the Supplementary Act on the Legal Regime Applicable to
Network Operators and Service Providers promotes the coordination of national regulatory authorities
toward the establishment of a single point of contact for licensing and authorization procedures.
However, these provisions remain general, are not sufficiently detailed, and have not been implemented
by most ECOWAS member states.
Open access policy, in particular to dark fiber. Open and fair access to backbone infrastructure running
through a country and across the border to another country would trigger an increase in cross-border
communications. It is notable that there are no RIOs for dark fiber indefeasible rights of use (IRU) or
28
wavelengths. Under most legal and regulatory frameworks, nonnational operators cannot benefit from
the rules applicable to access and interconnection, which prevent them from gaining access to national
capacities, international capacities, and dark fiber. Yet, access to such reSource is necessary for the
deployment of cross-border or regional networks. ECOWAS Regulation C/REG. 06/06/12, on conditions
for access to submarine cable landing stations, which is directly applicable in all member states, aims to
ensure that landlocked countries have equal access to submarine fiber that the coast countries have.
Infrastructure sharing and colocation. Related to the principle of open access, specific regulations or
guidelines are required for access to the core network by other network operators. These include
guidelines on sharing masts and poles, spaces in buildings with termination and switching equipment,
trenches through which the fiber optic cable runs, and so on. Rights of way and access to electric power
may require securing additional approval from the granting authority, which should be obtained before
the infrastructure-sharing arrangement between operators can be finalized. And currently there is no
“dig once” policy whereby construction of ducts and pipes underground is planned for the needs of the
various operators and future needs so as not to dig the ground multiple times, which has significant cost
implications as well as disruptions to roads and other facilities (around 75 percent of the cost to lay fiber
underground is in construction and works).
Dispute resolution. One of the best practices in telecommunications is the clear guidelines for dispute
resolution procedures. Yet, in many ECOWAS member states, there are currently no specific provisions
allowing operators established in an ECOWAS member state to settle a dispute with an operator in
another member state. Such dispute settlement procedures are essential to ensure that difficulties
faced when developing cross-border networks can be solved adequately and in a timely fashion. The
ECOWAS Supplementary Act on the harmonization of Policies and of the Regulatory Framework for ICT
sector provides for specific rules dealing with this issue. However, the provisions of this article are not
directly applicable in member states, and most member states have not transposed this article in their
domestic law.
f) Recommendations
The agenda for the transition from a national to a regional regulatory framework and from mobile
network-centric policies to data traffic policies points to the need for a renewed commitment toward
the objective of easing cross-border communications connectivity. The following recommendations
consider the regional and national levels:
➢ Regional Legal and Regulatory Frameworks
National legal and regulatory frameworks are currently designed to foster the growth of the
communications sector at the national level. Although some regional frameworks have been put in
place (such as the ECOWAS Supplementary Acts), there is scope for improvement in their
transposition and implementation. Hence, while national infrastructure and international
connectivity through submarine cables have developed, investments in regional cross-border
connectivity, policy, and regulatory measures for market development and the provision of the
resultant services at affordable costs by the private sector have lagged. The development of a
formal framework to foster optimal technical and financial conditions for regional connectivity,
29
which shifts the focus from developing individual domestic markets to a single connectivity market,
is necessary to develop further regional connectivity.
The ECOWAS Supplementary Acts provide a strong framework for governments and national
regulatory authorities to develop the necessary national legal and regulatory frameworks to foster a
regional market for digital infrastructure. Transposing and implementing these acts into national
frameworks in a prioritized and staggered manner can serve as a starting point toward developing
such a regional outlook for digital sector regulation. The following areas are identified as priorities
for the consideration of member states and their national regulatory authorities:
• Regional licensing regime. Facilitate telecom operators that are licensed or authorized in a
member state to provide certain services across the region, such as the rollout of passive
infrastructure, leasing of dark fiber, and so forth. Similarly, enable owners of alternate
infrastructure, such as utilities, to roll out national as well as regional networks. In doing so
regionally, it is recommended to develop a single window for licensing and authorization
for infrastructure development that facilitates engagement with the necessary authorities.
Relevant ECOWAS Supplementary Acts: Article 3.1 of Supplementary Act A/SA. 2/01/07 on
Access and Interconnection in Respect of ICT Sector Networks and Services; Articles 8.1 and
30 of the Supplementary Act A/SA. 3/01/07 on the Legal Regime Applicable to Network
Operators and Service Providers.
• Significant market power and competition. Addressing SMP at the national and regional
levels is necessary to promote competition and a marginal cost–based pricing mechanism
for services in the region, which is the cornerstone for regulating ICT markets. In addition
to identifying and outlining necessary action to address SMP, measures should be taken to
prevent the creation of such market distortions in the future. This requires significant
efforts at the national level through periodic market analysis to assess SMP and the
implementation of pro-competition measures, such as open access obligations to
infrastructure, price ceilings, liberalization of critical infrastructure (such as gateways), and
so forth.
Relevant ECOWAS Supplementary Acts: Article 9.1 of the Supplementary Act A/SA. 3/01/07
on the Legal Regime Applicable to Network Operators and Service Providers; Article 19.2 of
the Supplementary Act A/SA. 2/01/07 on Access and Interconnection in Respect of ICT
Sector Networks and Services.
• Passive infrastructure sharing and dark fiber. Although Article 10 of the Supplementary Act
A/SA. 2/01/07 on Access and Interconnection in Respect of ICT Sector Networks and
Services lays down provisions for the national authorities promoting the sharing of passive
infrastructure, they do not cover specific aspects, such as rules applicable to accessing
alternative infrastructure, publication of the list of active and passive infrastructure by
operators, and conditions for passive infrastructure sharing. It is recommended that the
ECOWAS Commission, in conjunction with member states, detail the applicable provisions
for passive infrastructure sharing across the region.
• Dispute resolution. In Burkina Faso, Guinea, Côte d’Ivoire, Mali, and Senegal, operators
established in other ECOWAS member states benefit from the right to go before the
regulatory authority, but the same is not true for other member states. To achieve the goal
of establishing a West African Common Market, it is necessary to have an independent
30
dispute resolution mechanism or authority that is accessible to entities from all member
states.
• Standardized data collection. Accurate and periodically updated data on connectivity
infrastructure at the national level—aggregating to regional data—is a must for optimal
utilization of the existing infrastructure. It is recommended that the ECOWAS Commission
establish standardized reporting guidelines for infrastructure data, which should be
collected and published periodically. The key data that are needed include, but are not
limited to, the number of base transceiver stations (BTS) by type, fiber infrastructure,
point-of-presence (POP) sites, and the capacity of each type of connectivity infrastructure.
This effort also provides an opportunity to integrate geospatial information into the data
sets and create digital connectivity maps and informational platforms for the region. This
would include information on the presence and availability of passive linear infrastructure,
such as roads, rail lines, and electricity grids.
➢ Supply-Side Enablers at the National Level
• Reference interconnection offers. The lack of availability and transparency of wholesale
connectivity prices is a bottleneck for operators without large-scale infrastructure to connect
across borders. A lack of standardization in the technical information provided and high degree
of variation in the price points of RIOs were observed, with all reference offers limited to
national stakeholders only. It is recommended that the ECOWAS Commission mandate the
publication of standardized RIOs at the national level, with a long-term goal of operators (and
owners of passive infrastructure) eventually providing regional RIOs.
• Alternate infrastructure. The utility, energy, and transportation sectors can play a significant role
in developing national and regional backbone infrastructure. The Senegal River Development
Organization (OMVS) and CSLG projects can be used as key drivers of subregional cross-border
connectivity and serve as examples for leveraging future infrastructure projects in the region. By
allowing non-telecom operators to engage in rolling out connectivity infrastructure such as dark
fiber, national and regional connectivity can expand at a more rapid pace. This requires
development of the necessary legal and regulatory frameworks at the national level, which can
integrate regionally and promote infrastructure sharing and utilization of alternate Source of
infrastructure at the regional level. Additionally, it can foster greater competition in the
wholesale market and address SMP-related concerns to an extent. It can also serve as a starting
point to implement a regional “dig-only-once” strategy, contracting infrastructure developers to
lay fiber optic cable and commercialize the available infrastructure using innovative business
models, as regulated by national authorities.
• Subregional connectivity. Creating multiple subregional hubs of fiber optic infrastructure and
digital platform infrastructure (data centers, exchange points, and cyber security centers) and
leveraging alternative infrastructure projects, such as the Senegal River Development
Organization and CSLG, could promote robust and secure national and subregional digital
ecosystems. This would in turn provide different options for redundancy networks for the
individual countries. In this instance, the heterogeneous economic and market groupings within
the region could be turned into an advantage.
31
➢ Demand-Side Stimulation (Regional IP Usage)
Most member states have yet to establish neutral IXPs, and many that have been established are
operating sub-optimally. Without an enabling environment that fosters the growth of independent
networks, which would require more IXPs, regional traffic will continue to leave the region and be
interconnected in Europe. This, in turn, does not allow the price of regional IP interconnection to be
as competitive as international interconnection. This is further evidenced by websites receiving the
highest traffic from the region all being hosted outside Africa. Promoting local content development
and hosting in the region will redirect a large proportion of international IP traffic within the region,
and thus reduce the cost of regional interconnection and bandwidth due to higher traffic volume.
Developing greater IP usage through establishment and implementation of comprehensive
broadband strategies at the national and regional levels should be an immediate priority.
III. Low-Cost International Mobile Roaming: Boosting Consumer Welfare Although the communications market in Africa still relies heavily on 2G voice services, which constitute
55 percent of total subscriptions, it is projected to decline to 10 percent by 2023. 22 Internationally,
regional economic communities have leveraged the digital sector to strengthen regional economic
integration, while also promoting consumer welfare through increasing the affordability of services,
including the reduction and eventual elimination of roaming charges. Roaming does not form a large part
of mobile operator revenues, but it has traditionally been a high-margin business segment, partially due
to the need to compensate for the high risk of subscribers’ bad debt, delayed payments, and potential
fraud, among other reasons.
Estimating the market for international roaming requires information on prices and volumes (of calls and
data usage) for each operator in each country, as well as information on cross-border movement. Such
data are not widely available for the region, as transparency in retail pricing is not enforced, and the
information would include commercially sensitive data owned by mobile operators. Additionally, the
limited international experiences in regional mobile roaming regimes do not allow for accurate estimation
of the price elasticity of roaming and resulting changes in consumer behavior. This study aims to highlight
the current state of international mobile roaming in the region and the challenges to the reduction and
abolishment of roaming charges. This section also highlights challenges to the development of a regional
outlook for the sector, particularly since the roaming market includes wholesale and retail elements.
On the one hand, the reduction or abolishment of roaming tariffs would constitute a reduction in operator
revenues from the service in the medium term. On the other hand, it would create a large consumer
surplus, which, by one estimation, would amount to US$775 million over the next four years for the
region.23 Table 3 presents the estimated consumer surplus per inhabitant due to the abolishment of
roaming based on the same study. For comparison, the ECOWAS region has a higher population and lower
gross national income per capita than the Gulf Cooperation Council (GCC) and European Union.
32
Table 3. Transfer of Welfare (Additional Consumer Surplus) (US$ per inhabitant)
GCC (2012) $1.8
EU (2009 to 2013, yearly average) $5.0
ECOWAS (2017 to 2020, yearly average) $0.6
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. Note: ECOWAS = Economic Community of West African
States; EU = European Union; GCC = Gulf Cooperation Council.
Regional roaming initiatives have been met with varying degrees of success and followed different paths.
A common result across all initiatives is a significant increase in roaming usage, which can be seen as an
indicator of consumer surplus. In Kenya, for example, the volume of calls increased by 264 percent when
regional roaming rates were abolished. Similarly, in France, call volumes increased by 50 percent when
tariffs decreased by 50 percent, and more recently, some European operators have reportedly seen an
increase in roaming data usage of 870 percent.24
Operators across Africa, including in the ECOWAS region, have recognized the potential of the roaming
market and developed on-network roaming plans in response. Additionally, certain country pairs within
ECOWAS have started implementing free roaming to benefit consumers and facilitate greater integration.
As highlighted in the previous section, the region has significant infrastructure, and the retail market is
gradually moving toward seamless movement. However, regional policy and regulatory efforts can further
aid in the development of this market. In addition to increasing consumer welfare, affordable regional
roaming can help smaller operators provide services to their subscribers and not be burdened by the costs
associated with being in a net payable situation.
The roaming market also allows taking a regional view of mobile communications, since it entails
wholesale (requiring interconnectivity) and retail elements of the communications market. Analyzing this
market enables the identification of underlying issues for greater harmonization of the sector at the
regional level.
a) Potential for a Regional International Mobile Roaming Regime
Affordable and seamless roaming can help develop regional economic activity. To assess the potential for
roaming, the following subsections consider trade, migration, and tourism flows within the region as
proxies.
i. Trade Flows in ECOWAS
Trade flows within ECOWAS can serve as a proxy for regional economic activity that can be further
supported through affordable roaming services. As highlighted in figure 9, regional trade as a percentage
of total trade varies from 2 to 60 percent, with an average of 9 percent across member states.
33
Figure 9. Intra-ECOWAS Trade (%)
Source: UN COMTRADE data.
As a possible and observable proxy to estimate potential development for roaming, the trade exchange
values show that there is no significant difference between ECOWAS countries and countries in other
regions. Additionally, this analysis demonstrates that the most important trade flows are between Nigeria
and other countries, as Nigeria is the biggest economy in the region (figure 10).
Figure 10. Major Trading Parties within ECOWAS: Annual Trading Value (US$, millions)
Source: UN COMTRADE data.
ii. Migration Flows within the ECOWAS Region
Intra-ECOWAS migration flows as a portion of total migration flows are significant, accounting for 64
percent. Only 30 percent of migrants from ECOWAS reside outside Africa, of which 15 percent are in
Europe, 6 percent in North America, and 9 percent in the rest of the world. The main countries of origin
60%
46%
38%
29%24% 23%
20% 19% 19% 17%
8%4% 2%
9%
% of trade with other ECOWAS countries
0
500
1000
1500
2000
2500
3000
Nigeria/ Côte
d'Ivoire
Nigeria/
Ghana
Nigeria/ Niger
Mali /Senegal
Nigeria/
Senegal
Côted'Ivoire
/Burkina
Faso
Côted'Ivoire
/Ghana
Côted'Ivoire/ Mali
Ghana/
BurkinaFaso
Senegal/
Nigeria
Senegal/ Mali
Guinea/
Ghana
SierraLeone /Senegal
Annual trading value (million USD)
34
for migration within ECOWAS are Burkina Faso (1.4 million), Côte d’Ivoire (0.9 million), and Mali (0.8
million). Côte d’Ivoire (2.4 million), Ghana (1.7 million), Burkina Faso (1.0 million), and Nigeria (0.8
million) are the largest destination countries (map 5).
Map 5. Migration within the ECOWAS Region a. By country of origin
b. By country of destination
Source: “A Survey on Migration Policies in West Africa,” International Center for Migration; consultant analysis.
Note: The map in panel a excludes migration to Ghana.
Coted’Ivoire(- 0.9 m)
Sierra Leone(- 0.2 m)-
Mali(- 0.8 m)
Guinea-Bissau(-0.1 m)-
Ghana(-0,4 m)
Niger(- 0.3 m)
Guinea(- 0.4m)
Nigeria(-0,1 m)
Senegal(- 0.2 m)
Liberia(- 0.3 m)
Benin(-0.4 m)
The Gambia(- 0.0 m)-
CapeVerde
(-0.0 m)
Burkina Faso(-1.4 m)
Migration stock within the ECOWAS Regionby country of origin (1)
Source : A survey on Migration Policies in West Africa, ICMPD et OIM, Consultant Analysis(1) Excluding migration to Ghana
between 0.0 and 0.5 million
between 0.5 and 1.0 million
Between 1.0 and 1.5 million
Togo(- 0.3 m)
Coted’Ivoire
(+ 2.4 m)
Sierra Leone(+ 0.1 m)-
Mali(+ 0.1 m)
Guinea-Bissau(+0.0 m)-
Ghana (1)
(+1.7 m)
Niger(+ 0.2 m)
Guinea(+ 0.4m)
Nigeria(+0,8 m)
Senegal(+ 0.1 m)
Liberia(+ 0.1 m)
Benin(+0.2 m)
The Gambia(+ 0.3 m)-
CapeVerde
(+0.0 m)
Burkina Faso(+1.0 m)
Migration stock within the ECOWAS Regionby country of destination
Source : A survey on Migration Policies in West Africa, ICMPD et OIM, Consultant Analysis(1) estimates
between 0.0 and 0.5 million
between 0.5 and 1.0 million
Between 1.0 and 1.5 million
Between 1.5 and 2.0 million
Between 2.0 and 2.5 million
Togo(+ 0.1 m)
35
iii. Short-Term Travel and Tourism within ECOWAS
Analysis of short-term migration and travel is another way to assess the potential market for roaming.
Higher levels of economic integration in the region may be associated with increased short-term regional
travel and support tourism in the region, as citizens can travel freely within the region. International
tourism currently exceeds one billion persons a year and has been growing at an annual rate of 3 percent.
Tourism in Africa has varied over the past year between 55 million and 62 million persons, which
represents 5 to 7 percent of world tourism. Figure 11 highlights the share of tourism between some of
the countries, which ranges between US$15 and US$43 per incoming tourist.
Figure 11. Total and Internal Tourism in ECOWAS
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including Olivier Jacquinot,
Katia Duhamel, Laurent Cohen, and Russel Southwood.
Lengths of stay vary from 3 to 8 days (figure 12). In addition to overnight visitors (0.6 million), Nigeria has
an important flow of same-day visitors (3.4 million), likely due to its economic size and position as an
international hub in Africa.
Figure 12. Lengths of Stay in Days
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including
Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood.
257
191
33
152
600
44
327
110
70
836
132
7
62
43%
37%
24% 24%22%
15%
19%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0
100
200
300
400
500
600
700
Benin Burkina Faso Guinea Mali Nigeria Sierra Leone Togo
Internal ECOWAS tourism vs Total ECOWAS tourismin thousands and %
Total Internal %
8 8
7 76.5
4.43.9
3.4 3.1 3
0
1
2
3
4
5
6
7
8
9
36
International tourism is still in its developmental stages in Africa, and it is expected to grow as incomes
increase and the various regional integration efforts across the continent mature. Given the low average
lengths of stay and relatively high amount of internal travel within the region, the roaming market
demonstrates potential for growth.
b) Current State of International Mobile Roaming within ECOWAS
A total of 21 mobile operators in the ECOWAS region serve 320 million subscribers, with a high degree of
market concentration among the top five operators. Figure 13 highlights the market share of each of the
operators in the region and reveals three distinct groups:25
➢ Tier 1. Five operators with more than 10 percent of the market share (MTN, Airtel, Etisalat, Orange,
and Globalcom), totaling 89 percent of the regional market
➢ Tier 2. Two operators that are part of large international groups (Vodacom and Millicom), with more
than 2 percent of the market share each
➢ Tier 3. The remaining 14 operators, representing less than 6 percent of the regional market.
Figure 13. Regional Market Share (%)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including Olivier Jacquinot,
Katia Duhamel, Laurent Cohen, and Russel Southwood.
Among the five biggest operators, four are present in Nigeria, the largest market in the region (50 percent
of the regional market). The geographic footprint of these operators across the region can facilitate the
ease of interconnectivity and reduce roaming costs.
31
,7%
16,0
%
16,0
%
13
,0%
12,0
%
2,7%
2,5%
1,2%
1,1%
1,0
%
0,8
%
0,5
%
0,4%
0,4%
0,2
%
0,2%
0,1%
0,1
%
0,1
%
0,0
%
0,0%
0,0%
5,0%
10,0%
15,0%
20,0%
25,0%
30,0%
35,0%
Regional market shareTier 1: 89%
Tier 2: 5% Tier 3: 6%
37
MTN is present in all the coastal countries from
Nigeria to Guinea-Bissau (except Togo), thus
benefiting from excellent international and
regional connectivity.
Airtel is present mainly in the eastern part of the
region and is in the process of selling its
operation in Burkina Faso to Orange.
Etisalat (Maroc Telecom) has significant
presence in the region.
Orange has a very large geographical footprint in
the region, which was further strengthened
through recent acquisitions of operations in
Liberia, Burkina Faso, and Sierra Leone.
Globalcom has the smallest geographical
footprint among the top five operators, with presence in three coastal countries.
CoteD’Ivoire
Sierra Leone-
Mali
Guinea-Bissau-
Ghana
Niger
Guinea
Nigeria
Senegal
Togo
Liberia
Benin
The Gambia-
CapeVerde
Burkina Faso
CoteD’Ivoire
Sierra Leone-
Mali
Guinea-Bissau-
Ghana
Niger
Guinea
Nigeria
Senegal
Togo
Liberia
Benin
The Gambia-
CapeVerde
Burkina Faso
CoteD’Ivoire
Sierra Leone-
Mali
Guinea-Bissau-
Ghana
Niger
Guinea
Nigeria
Senegal
Togo
Liberia
Benin
The Gambia-
CapeVerde
Burkina Faso
CoteD’Ivoire
Sierra Leone-
Mali
Guinea-Bissau-
Ghana
Niger
Guinea
Nigeria
Senegal
Togo
Liberia
Benin
The Gambia-
CapeVerde
Burkina Faso
as of December 2015new acquisition
CoteD’Ivoire
Sierra Leone-
Mali
Guinea-Bissau-
Ghana
Niger
Guinea
Nigeria
Senegal
Togo
Liberia
Benin
The Gambia-
CapeVerde
Burkina Faso
38
The primary motivation behind further development of international mobile roaming in the ECOWAS
region is to facilitate the fluidity of cross-border exchanges, be it communications, goods and services,
people, or cultural. Estimating the impact of seamless and affordable roaming in terms of increased
traffic and usage is challenging, and only now are we seeing preliminary data from the European Union
after the adoption of Regulation No. 2015/2120 in June 2017, which abolished roaming tariffs. From the
consumers’ perspective, the main obstacle to the use of roaming is unaffordability, which pushes a large
portion of the latent demand or potential customers to resort to substitution offers, such as buying local
SIM cards or using over-the-top (OTT) services on Wi-Fi networks. These options have drawbacks for the
consumer and cannot offer the continuity and seamlessness that affordable roaming can. Additionally, it
may become increasingly difficult to obtain SIM cards for short stays, as more countries strengthen their
Know Your Customer requirements.
All the major operators have roaming agreements with each other and provide roaming services to their
customers across the region. Table 4 summarizes the availability of roaming tariff information on the
websites of the region’s main telecom operators. Only Airtel provides tariffs for all the ECOWAS countries
where it operates; the other operators provide tariffs for up to 40 percent of their market.
Table 4. Availability of Roaming Prices
Source: Operator websites. Note: The green indicates that the information is provided,
red indicates that the information is not provided, while white indicates the operator is
not present in the country.
Analysis of the available tariffs demonstrates the existence of two pricing strategies for roaming, as
adopted by the major operators:
• Preferential on-net roaming offers. Airtel and MTN offer standard roaming and “one network” roaming. One network roaming or preferential on-net roaming refers to operators providing specific prices for customers connecting to the home operator’s network in another country. For instance, Airtel customers in Nigeria can benefit from on-net tariffs if they connect to the Airtel network in Ghana. These on-net offers—which are advertised as “Roam Like Home” by
Availability of
roaming tariffs
MTN
GroupAirtel Etisalat Orange
Nigeria
Ghana
Cote d'Ivoire
Mali
Senegal
Burkina Faso
Guinea
Benin
Niger
Togo
Liberia
Sierra Leone
Guinea-Bissau
39
MTN and “One Airtel” by Airtel—propose low roaming tariffs, with little or no markup compared with home prices.
• Standard roaming. Orange and Etisalat tend to propose only all-network roaming prices. The two operators indicated that they were moving toward more aggressive pricing. In particular, Orange mentioned that new roaming-specific bundles, including those offering a predetermined volume of voice, short message service (SMS), and data at a fixed price, had been introduced recently. However, these new bundles are not clearly presented on the websites under roaming information.
The roaming prices offered by operators in the region are highly heterogeneous across countries, operators, and visited countries. Figure 14 highlights the current observable prices in visited countries for local calls and calls to the home country. The prices are presented by home country and specific operator combinations, where the bottom value of the bar indicates the minimum price, and the top of the bar indicates the maximum price observed. For example, in the case of an Airtel customer from Ghana, a roaming call from Nigeria to the home network in Ghana costs US$0.8 per minute, while it costs US$9.2 per minute while roaming in Senegal. Similar variation is noticeable across visited countries when analyzing roaming prices across other parameters. The price of a local call may vary from US$0.0426 (price for Airtel Niger roaming in Ghana) to US$11.3 per minute (price for Airtel Sierra Leone roaming in Burkina Faso). The same spread may be observed for calls to home and for data traffic. In the latter case, the price of 1 megabyte (MB) of roaming data usage varies from US$0.08 (MTN Liberia within the MTN zone) to US$60 (Airtel Ghana roaming in Senegal).
Figure 14. Price of Voice Roaming in ECOWAS (US$ PPP per minute)
Source: Operator websites. Note: PPP = purchasing power parity.
The minimum and maximum prices are not always comparable, since minimum prices may be limited to
on-net offers (connection to the same network). Similarly, figure 15 highlights the variation in data
roaming prices.
2,9
1,5
0,8
0,8
0,8 1,1
0,7
0,2
0,6
24
,2
13
,3
9,2
8,4
7,2
5,4
3,3
3,2
2,9
2,5
0,8
0,4
0,0
5,0
10,0
15,0
20,0
25,0
30,0
Price per minute for a call to home in visited country (USD)
2,9
0,4 0,5
0,2
0,8 0
,0
1,1
0,7 0,7
0,6 0
,8
11
,3
4,1
4,0
3,3
3,2
2,9
2,7
2,4
1,9
1,6
0,9
0,3
0,0
2,0
4,0
6,0
8,0
10,0
12,0
Price per minute for a local call visited country (USD)
40
Figure 15. Price of Data Roaming in ECOWAS (US$ PPP per MB)
Source: Operator websites. Note: MB = megabytes; PPP = purchasing power parity.
In addition to the high heterogeneity in roaming prices across the region, the prices are generally high—
and this comes to the forefront when average prices across the region are compared with regulated prices
in Europe, the GCC, or East Africa. Figure 16 illustrates the ratio between the average price observed in
ECOWAS and regulated prices in East Africa, the GCC, and Europe. The price for a call to home made in
ECOWAS is 23 times higher than in Europe, and the price for data roaming in ECOWAS is 65 times higher
than in Europe.27 Furthermore, roaming prices are considerably higher compared with domestic prices—
a differential that cannot be solely attributed to the costs associated with roaming, as will be seen in
subsequent sections of this report.
1,2
1,6
1,9
6,7
3,8
11
,6
3,6
1,2
0,3 1,
2
0,5
0,1
60,6
42
,0
32
,7
31
,1
29
,1
22,6
17
,9
13
,2
11,6
2,9
1,8
0,4
0,0
10,0
20,0
30,0
40,0
50,0
60,0
70,0
Price per MB (USD) in visited country
41
Figure 16. Ratio of Prices for Voice and Data in ECOWAS Compared with GCC, EAC, and Europe
Note: EAC = East African Community; ECOWAS = Economic Community of West African States; EU = European Union;
GCC = Gulf Cooperation Council; ONA = East Africa One Network Area.
c) Potential Barriers to Affordable Regional International Roaming
The most significant concern from the consumers’ perspective on roaming usage is price. Additionally, the
lack of published offers and complexity of pricing increase the fear of bill shock, further decreasing
incentives to utilize roaming services. The low volume of traffic acts as a disincentive for mobile operators
to allocate reSource to developing the roaming market through commercial offers and competitive pricing.
From the operators’ point of view, there may be few or no incentives to reduce roaming rates. The
assumption here is that high prices generate high margins, although from a very small volume, and that
the price elasticity of roaming traffic has not been proven to be important.
Although this market situation makes it difficult to assess the true size of the roaming market, evidence
from the European Union is starting to emerge, almost a year after the ruling on roaming came into effect.
BICS—the leading international wholesale connectivity provider—reported an 800 percent increase in
roaming traffic in the European Union in 2017 compared with 2016.28 While operators may have to rethink
their roaming business model, early evidence from the European Union suggests that the market
expanded, leaving scope for efficient monetization through bundles and offers.
Roaming prices (barring on-net roaming) in ECOWAS are generally higher than in other regions and vary
significantly within the region. This section analyzes potential reasons behind the current state of roaming
prices in ECOWAS.
42
i. Relatively High and Highly Varying National Retail Prices
The price levels in the domestic mobile markets of ECOWAS member countries can be analyzed based on
advertised offers on operator websites, for comparisons within and between regions. This section uses a
basket methodology—similar to the methodology used by the OECD—applied to all tariff schemes of
operators representing at least 80 percent of the total market share in each country. The benchmark
covers 80 countries and more than 6,000 tariff schemes. Purchasing power parity (PPP)29 is used to
provide relevant international comparisons.
Figure 17 compares the price of a basket of 100 calls and 300 MB of data usage per month. This basket
corresponds to a predefined mix of 300 national and international calls (with average split of on- and off-
net calls). The price is calculated for each operator in the country, as the lowest price resulting from all
the operators’ tariff schemes, and then the price per country is calculated using the market share of each
operator.
Figure 17. Price of a Medium-Usage Basket across ECOWAS (US$ PPP)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including
Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. Note: ECOWAS =
Economic Community of West African States; MB = megabytes; PPP = purchasing power parity.
There are significant disparities between countries, with a ratio of 1 to 5.8 for the same consumption
basket between the least expensive country (Guinea) and the most expensive (Togo). Figure 18 shows
that on average in ECOWAS, prices for this medium consumption basket are the highest compared with
other African regions, the Middle East and North Africa, and the European Union, although some countries
in ECOWAS have significantly lower prices.
204169 154 135 120 111
78 72 66 49
702
40
14080
0
100
200
300
400
500
600
700
800
Price of basket 100 calls - 300 MB (USD PPP)
43
Figure 18. Price of a Medium-Usage Basket: ECOWAS versus Other Regions (US$ PPP)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including
Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood.
Note: COMESA = Common Market for Eastern and Southern Africa; ECCAS = Economic Community
of Central African States; ECOWAS = Economic Community of West African States; EU = European
Union; GCC = Gulf Cooperation Council; MB = megabytes; PPP = purchasing power parity; SADC =
Southern African Development Community; UMA = Arab Maghreb Union.
The comparison using a high-consumption basket of 300 calls and 1 gigabyte of data, as shown in figures
19 and 20, reveals a similar situation, with average prices in ECOWAS being the highest, while prices are
lower in some individual countries.
Figure 19. Price of a High-Usage Basket across ECOWAS (US$ PPP)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including Olivier
Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. Note: ECOWAS = Economic Community
of West African States; GB = gigabytes; PPP = purchasing power parity.
71
59
4640
33
24
80
50
0
10
20
30
40
50
60
70
80
90
ECOWAS SADC ECCAS COMESA GCC UMA EU WeightedAverage
Price of basket 100 calls - 300 MB (USD PPP)
428
354
270 259 247 233205
144119 116
455
115
234204
050
100150200250300350400450500
Price of basket 300 calls - 1 GB (USD PPP)
44
Figure 20. Price of a High-Usage Basket: ECOWAS versus Other Regions (US$ PPP)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including Olivier
Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. Note: COMESA = Common Market for
Eastern and Southern Africa; ECCAS = Economic Community of Central African States; ECOWAS = Economic
Community of West African States; EU = European Union; GCC = Gulf Cooperation Council; GB = gigabytes;
PPP = purchasing power parity; SADC = Southern African Development Community; UMA = Arab Maghreb
Union.
The higher domestic call prices on average are a contributing factor to high roaming prices. The
heterogeneity in roaming prices can also be explained by the inherent heterogeneity of domestic call rates
across the region. This variation, or lack of harmonization in retail tariffs, should be a policy focus area for
national regulators and regional authorities, to address challenges in the roaming markets.
ii. Similar Trends in Retail and Wholesale Markets
The roaming market is comprised of retail and wholesale components, at the domestic and international
levels. In addition to operating costs, such as network and signaling costs, a roaming call incurs certain
tariffs—domestic and international mobile termination rates (MTRs) and inter-operator tariffs (IOTs).
These costs, in addition to the operating costs pertaining to all calls, are supported by the home operator
(operator of the customer’s country of subscription) or passed on to the home operator by the visited
operator. The IOT, also referred to as the wholesale price in the roaming market, is an important
component. The IOT corresponds to the price paid by the home operator to the visited operator for any
outgoing call, and it is aimed to cover the costs encountered by the visited operator for the call. No IOT is
charged in the case of incoming calls, and only termination rates apply.
The MTR is the cost of terminating a call on the network of another national operator and is generally
supposed to be cost oriented according to national regulations, but very often that is not the case. The
MTR varies significantly across countries in the region, from US$0.01 (in Ghana) to US$0.12 (in Cabo
Verde), as shown in figure 21.
203
175
121
8873
42
204
129
0
50
100
150
200
250
ECOWAS SADC ECCAS COMESA GCC UMA EU WeightedAverage
Price of basket 300 calls - 1 GB (USD PPP)
45
Figure 21. MTR in the ECOWAS Region (U.S. cents)
Source: Regulators’ decisions; operators’ reference interconnection offers. Note: ECOWAS = Economic Community of West African States; MTR = mobile termination rate.
Figure 22 shows the comparison between the European Union and ECOWAS for the level of MTRs. The
figure highlights that MTRs in ECOWAS countries are generally significantly higher than in Europe, in
addition to varying significantly within the region.
Figure 22. MTR: Europe versus ECOWAS (U.S. cents per minute)
Source: Body of European Regulators for Electronic Communications; regulators’ decisions; operators’ reference interconnection offers. Note: MTR = mobile termination rate.
1,11,7 2,0 2,0
2,83,5
4,0 4,1 4,25,1
6,8
9,3
12,1
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
Mobile termination rate (USD cents)
Mobile termination rate (USD cents) Average
Termination cost (low range) Termination cost (high range)
,5 ,6 ,8 ,9 ,9 ,9 ,9 ,9 1, 1, 1,1
1,1
1,1
1,1
1,1 1,1
1,1
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Serb
ia
Bur
kin
a Fa
so
Gam
bia
Côte
d'Iv
oire
Nig
er
Ben
in
Gui
nea-
Bis
sau
Swit
zerl
and
Liec
hten
stei
n
Togo
Cape
Ver
deMobile termination rates (USD cents per minute): Europe vs ECOWAS
Europe ECOWAS Average Europe Average ECOWAS
46
It is often argued that the underlying costs for MTRs are much higher in African than in European countries,
mainly due to less traffic volume, lower density requiring sparser networks, and operating difficulties such
as the provision of electricity. Since MTRs are mandatory fixed costs that all roaming calls terminating on
a different network incur, the high variation between MTRs across member states may be an obstacle for
reducing and harmonizing roaming prices in the region. It appears that, in most cases, MTRs are not cost
based; instead, they are marked up to include an excess margin in national mobile termination. This excess
margin constitutes a significant difference between a local roaming call and an ordinary call. Additionally,
operators have minimized their exposure to MTRs with a high on-net share of traffic through lucrative on-
net offers.
Calls made to the home country or other international destinations while roaming incur international
termination costs. As shown in figure 23, international MTRs vary from US$0.08 (in Nigeria30) to US$0.70
(in The Gambia). Additionally, the existence of supplementary taxes or price floors (especially in Guinea,
Ghana, and Benin), as well as price ceilings for international MTRs (Sierra Leone), further complicate and
add heterogeneity to roaming tariffs. Although the costs of national and international termination are
fairly similar (only international transit cost should separate them), a high variation is observed between
them across all the countries except Nigeria.
Figure 23. International MTR and MTR (US$)
Source: “An Assessment of International Voice Traffic Termination Rates,” Policy, Competition & Economic Analysis Department, July 2015, National Certification Corporation. Note: MTR = mobile termination rate.
Data calls are also subject to the wholesale markets, and data roaming calls involve two fixed-cost
components: data transit from the visited country to the home country, and data connection in the home
country (similar to data connection for any subscriber of the home operator). There is high variation in
international IP transit prices across member states, and these rates are generally high in the region
compared with global benchmarks. Figure 24 highlights the current price of international bandwidth,
0,08
0,17 0,
21 0,24 0,26
0,27
0,27
0,27 0,
30
0,31 0,33 0,
38
0,38
0,50
0,70
0,00
0,10
0,20
0,30
0,40
0,50
0,60
0,70
0,80
International MTR and MTR (USD)
Int'l MTR (USD) MTR (USD) Average Int'l MTR
47
ranging from US$50 to US$552 per Mbps per month. Addressing the affordability of mobile Internet in
domestic markets will have direct effects on roaming data prices as well.
Figure 24. Price of International Capacity in ECOWAS (US$/Mbps/month)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including
Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. Note: ECOWAS =
Economic Community of West African States; Mbps = megabits per second.
The last kind of fixed cost incurred for roaming calls is IOT. Currently, IOTs in the ECOWAS region are a
result of bilateral agreements between operators or agreements between operators and carriers offering
wholesale roaming. As a result, data on IOTs are confidential and not available publicly. Since IOTs are not
regulated and are only dependent on commercial agreements between operators, the level of IOT may
vary significantly among operators and countries. Additionally, smaller operators may not have adequate
bargaining power to negotiate favorable IOT and remain in net payable positions. The estimated average
level of IOT in the GCC is US$0.5 for calls to home and US$0.28 for calls to local areas.31 The wholesale cap
in Europe has been reduced to €0.05. Other estimations in Southern and West Africa32 suggest high rates
for data roaming: US$11 per MB in Angola, 10.78 in Mauritius, 1.05 in Zimbabwe, and 0.42 in the Kingdom
of Eswatini.
d) Lessons from Regional Roaming Experiences
Roaming regulation aims to develop the retail market to maximize utility for consumers and profit for
operators. However, other aspects, such as incentives to invest or eliminating fraud and arbitrage that
can arise in international traffic, should be considered as well. In this section, we present the evolution of
international roaming in four regions, which broadly followed two approaches:
• Voluntary, private sector–led models in East and Southern Africa, with Southern Africa
analyzed as an ongoing initiative
• Purely regulated models of the European Union and six Arab GCC countries.33
552
13696
60 55 50
0
100
200
300
400
500
600
Liberia Benin Burkina Faso Côte d'Ivoire Gambia Senegal
Price of international bandwidh (USD / Mbps / month)
48
The International Telecommunication Union (ITU) describes various measures for promoting international
communications at affordable prices34:
(i) Empowering consumers to benefit from efficient competition and regulation, so that they have
the information and transparency to take appropriate actions
(ii) Identifying measures for improving the way the market works
(iii) Creating proposals for regulatory actions, which may include measures to lower rates.
Some of these measures may be taken unilaterally by a single country; others may be implemented
between two or more countries35 or applicable within a regional economic community, such as ECOWAS,
the Southern African Development Community (SADC), the European Union, the Organization of Eastern
Caribbean States (OECS),36 or others. Table 5 gives examples of the different categories of regulatory
intervention available to national and regional regulatory bodies. The ITU is currently pursuing an initiative
relating to the decrease of international roaming prices under the ITU Global Dialogue on International
Mobile Roaming (IMR) called Let’s Roam the World.37
Table 5. Range of Regulatory Options
Option range Example
Light regulatory intervention Improve customers’ understanding of roaming prices
Beyond some financial threshold, submit the pursuit of roaming services to obtaining the expressed consent of the customer
Intermediary regulatory intervention
Retail price cap and often wholesale price cap
Extensive regulatory intervention Unbundling of roaming services from national services
i. One Network Area Initiative in East Africa
In the EAC, where markets were historically integrated and more formally harmonized through the
activities of the East African Regulators of Postal and Telecommunications Organization, the
telecommunications markets were among the earliest in Africa to open. Prices for domestic calls were
driven down by competition, but roaming charges remained high. The regulatory association responded
positively to international trends and local pressures to open international gateways. Kenya, the last to
open its international gateway, finally gave in to regional pressures in 2004. The high cost of roaming had
already become an issue within the region, characterized by its progressive regulation and political
pressures on the regional regulators’ association, the East African Regulators of Postal and
Telecommunications Organization, to explore ways to accommodate proposals by then Celtel (Zain38) in
2006, to offer a roaming charge-free, integrated service in the region.
Zain, through its operations in East Africa, launched One Network by removing roaming charges and
allowing customers to move seamlessly across its networks in Kenya, Tanzania, and Uganda. The initiative
changed the dynamics in the region and strengthened Zain’s market position in each country. In Uganda,
in which it was weakest, Zain moved from fourth to second position within a year. Shortly thereafter,
Vodacom in Tanzania, Safaricom in Kenya, MTN and UTL in Uganda, and MTN Rwanda announced a service
49
offering cross-border services at the price of the country of origin. Within months, roaming charges had
disappeared across all networks in East Africa.
Relying on this private initiative, the EAC made a joint commitment in 201439 in the framework of the
Northern Corridor Integration Projects to create the One Network Area in four countries belonging to the
EAC (Burundi, Kenya, Rwanda, and Uganda), with the benefits also being extended to South Sudan so that
all calls between member countries would be billed as though they were local (table 6). The agreement
led to a pact between Safaricom, MTN, and Airtel Uganda that enables subscribers to receive calls for free
while in Uganda and pay a flat rate of US$0.1040 for calls to other East African countries.
Practically, the new tariff regime was agreed to by Kenya, Uganda, Rwanda, and South Sudan at the fifth
Heads of State Summit for the Northern Corridor Projects held in Nairobi in May 2014. Tanzania and
Burundi (EAC countries) are not part of the deal because they missed meetings that led to the planned
regional tariff plan. The statement further mandates member states to exempt regional calls from
surcharges applied by local operators on international incoming calls as well as additional charges on
subscribers on account of roaming within the region. Accordingly, there shall be no charges for receiving
calls while roaming within the region and subscribers traveling within the member states will be charged
as local subscribers in the visited country.
This has required telecom operators within the region to renegotiate bilateral agreements to ensure full
implementation of the One Network Area by September 1 for Uganda, Kenya, and Rwanda and December
31 for South Sudan, regardless of the telecommunication provider of the customer.
Table 6. Implementation Schedule of the One Network Area Initiative
► Heads of state directed the implementation of the One Network Area by December 31, 2014.
► August 2014, Ministers of Information and Communications Technology gazetted the
implementation guidelines of the One Network Area.
► Early implementation of the One Network Area was set for September 1, 2014 for Kenya, Uganda,
and Rwanda.
► Rwanda and Kenya launched the One Area Network on October 6, 2014.
► Uganda launched the One Area Network on January 7, 2015.
► Tanzania and Burundi launched the One Area Network on July 15, 2015.
More recently, the EAC has announced that it is willing to expand this initiative to include data and mobile
money services.41 Kenya, South Sudan, Uganda, and Rwanda will be the first countries in the region to
benefit from the expanded initiative. Adoption of the One Network Area has led to dramatic changes in
roaming tariffs. Figure 25 shows examples of the evolution of tariffs,42 with roaming rates dropping by 20
to 97 percent.
50
Figure 25. Examples of Changes in Tariffs since Adoption of the One Network Area (US$ PPP)
Source: “A Case Study of ONA,” International Telecommunication Union, 2016. Note: ONA = One Network Area; PPP
= purchasing power parity.
The early results have been remarkable (box 1). Inbound roaming calls to Kenya from Rwanda increased
by over 950 percent, from ~63,000 minutes in September 2014 to over a million minutes by December
(see figure 26). This success with mobile voice traffic could encourage operators to cut data roaming
charges, in this case without regulatory intervention. The Uganda Communication Commission also
reports a tripling of roaming traffic after the introduction of the One Network Area.43
Figure 26. Examples of Increases in Volume of Voice Roaming since Adoption of the One Network Area
-22%-54% -59% -54%
-75% -80% -89% -88%-44%
-83%-44%
-97%
-20%-64%
-100%
0%
100%
200%
300%
400%
500%
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
8,00
Evolution of roaming rates between september 2013 and December 2015 (USD PPP)
September 2013 December 2015
51
ii. Ongoing Approach in SADC
In 1997, SADC45 established the Communications Regulators Association of Southern Africa (CRASA),
formerly the Telecommunications Regulatory Association of Southern Africa, a forum of communications
regulators in the region. It was established under the SADC Protocol on Transport, Communications and
Meteorology and has among its goals to: (i) attain regional integration and development goals, (ii) achieve
economic growth, (iii) accelerate poverty reduction, and (iv) achieve sustainable development. In
Box 1. Capitalizing on the Momentum for Eliminating Roaming Charges There have been several initiatives to reduce roaming charges in the West Africa region. One of the initiatives was kick-started at a Smart Africa conference. Founded in 2013 and headquartered in Kigali, Rwanda, Smart Africa is a commitment to accelerate sustainable socioeconomic development on the continent, ushering Africa into a knowledge economy through affordable access to broadband Internet and usage of information and communications technology (ICT). On April 18, 2016, in Kigali, a meeting of the Ministers of ICT, the Directors General of Telecommunications regulatory authorities, and representatives of the telecom operators from member states of Smart Africa was held with the main objective to adopt a regional telecommunications framework aiming to implement the One Africa Network. This initiative should now be extended to all 11 member states of the Smart Africa Alliance.44 All member countries have agreed to establish anti-fraud systems and measures against grey traffic. Implementation was set to start in May, with a report on the initiative to be presented during the African Union summit slated for July in Kigali, and operators within the region shall be required to renegotiate their bilateral agreements to ensure the full implementation of the One Network Area. Initiatives and memorandums of understanding (MoUs) in the West Africa region include the following:
• On August 8, 2016, in Conakry, Guinea, the Governments of Guinea and Mali signed an MoU abolishing roaming and harmonizing interconnection rates between their countries. This MoU follows decisions made during the Smart Africa Alliance meeting held in Kigali on July 17-18, 2016.
• On November 24, 2016, in Ouagadougou, Burkina Faso, telecommunications regulatory experts from G5 countries in the Sahel conclave in a technical meeting recommended the abolition of roaming charges between their countries (Mauritania, Mali, Burkina Faso, Niger, and Chad).
• On November 28, 2016, in Abidjan, Côte d’Ivoire, the regulatory authorities of Senegal, Côte d'Ivoire, Mali, Burkina Faso, and Guinea signed an MoU on the basic principles for the implementation of free roaming between these countries of West Africa by March 31, 2017 at the latest. The MoU includes the establishment in each country of a national technical committee led by the regulatory authority and comprising all the operators and the governmental authority in charge of telecommunications. Additionally, telecom regulators must guarantee some prerequisites, such as the fight against fraud, suppression of international surcharges, and cost orientation of termination rates.
• On January 3, 2017, in Dakar, Senegal, the Director General of the Telecommunications and Postal Regulatory Authority of Senegal announced that in March Togo joined the Abidjan protocol for free roaming.
Capitalizing on this momentum will require follow-through on implementation, as many of the MoUs do not have a defined strategy and timeline. Furthermore, the next challenge would be to come to an agreement on reducing data roaming charges.
52
particular, SADC wants to enhance regulation and promote regulatory harmonization as a means to
promote investment in the sector, regional integration, and universal network development and universal
access to ICT services.
The high cost of international roaming was identified as a particular area of concern and a Regional
Alliance Task Team46 was set up to investigate ways to reduce the high cost of international roaming. A
study recommended the following actions for the short term, including that any directives should “not
impose significant costs or regulatory burden on mobile operators and they also do not require
appreciable reSource from regulators or CRASA.” Other guidelines included the following:
• Implementation of regulated roaming data collection to be made by all members’ regulators
and compiled by CRASA
• Promotion of multilateral cost reduction and roaming hubbing
• Lower the regulation and cost of the international voice gateway (including but not limited to
gateway licensing policy)
• Increased transparency and consumer protection
• Price control regulation by agreement subject to a full regulatory impact assessment before
adopting this approach.
According to these recommendations, SADC has published the Guidelines on Transparency and Roaming
Service. The guidelines apply to SADC mobile operators in their provision of roaming services to SADC
customers in the region. The guidelines set out the minimum requirements for information provided by
mobile operators to ensure that there is transparency in the tariff information on regional mobile roaming
service:
Tariff information:
a) Tariff per minute of incoming and outgoing voice calls:
i. Within the visited SADC country
ii. To the home country
iii. To elsewhere in SADC.
b) Tariff per SMS sent and received:
i. Within the visited SADC country
ii. To the home country
iii. To elsewhere in SADC.
c) Tariff per MB for data and picture/video messaging.
SMS notification on entry to a visited country:
a) Operators shall send an SMS to every SADC customer upon entry into a visited SADC country when
the customer connects to a visited SADC country’s network.
b) The SMS notification shall contain the minimum information as per Annex 1.
c) The SMS notification may also be sent to customers on a balance call limit wherever it is
economically feasible for the operator to do so.
Further, the ministers recommended the implementation of the second Regulatory Impact Assessment.
On the basis of the said Regulatory Impact Assessment, it was decided that the SADC Home and Away
Roaming Project should be implemented in three phases as follows:
53
• Phase I: Liberalization, Transparency, Information, and Data Collection
• Phase II: Roam Like at Home
• Phase III: Cost-Based Price Regulation.
At this stage, information on the implementation of the initiative is publicly unavailable, although a
report points to the complexity of implementing Roam Like a Local. It is complex for the consumer and
imposes a heavy administrative burden on the regulators and operators. Furthermore, it is not the most
effective approach to facilitate moving toward lower international roaming prices. Accordingly, the
report recommends the implementation of an alternative framework, based on the concept of Roam
Like at Home. Based on this recommendation, CRASA has recently decided to launch a cost-modeling
tool to provide costs for wholesale and retail access to the member states.
iii. European Union Roaming Regulation
Unlike the East and Southern African cases, where the development of roaming was primarily driven by
competitive pressures in the private sector, the European Union has followed a regulatory approach to
roaming policy over the past 10 years. The European Union’s approach relies on harmonization of
domestic market factors, such as termination rates, and the use of domestic and international wholesale
tariff regulation. The sustained effort in supporting the development of international roaming in the
region culminated in the adoption of Regulation No. (EU) 2015/2120 “laying down measures concerning
open Internet access and amending Directive 2002/22/EC on universal service and users’ rights relating
to electronic communications networks and services and Regulation (EU) No 531/2012 on roaming on
public mobile communications networks within the Union” (the “New Regulation”) in October 2015. In
addition to retail pricing cuts and related affordability measures, the European Union has enhanced
transparency and consumer safeguard measures.
Among other innovations, the new regulation provides further price cuts for users of roaming services,
with roaming prices aligning with domestic prices as of June 15, 2017. On December 16, 2016, the
European Commission adopted implementing acts47 setting out detailed rules on the application of the
fair use policy, the method applied to assess the viability of the abolition of roaming charges in more detail,
and on the application for authorization that the roaming service provider must transmit the purposes of
this assessment (table 7).
Table 7. Price Development for International Roaming Services in the European Union, 2014–17 (price excluding tax)
Service July 1, 2014
(“eurotarifs”)
April 30, 2016
(maximum amount of the
additional fee)
June 15, 2017
Calls made
(minutes) 19 c€ National tariff (+5 c€)
Domestic price (no extra charge, subject to
“reasonable usage”) Calls received
(minutes) 5 c€ National tariff (+1.14 c€)
54
(SMS)
(sent) 6 c€ National tariff (+2 c€)
Internet
(month†) 20 c€ National tariff (+5 c€)
Source: “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Progressus including Olivier Jacquinot,
Katia Duhamel, Laurent Cohen, and Russel Southwood.
In addition to the regulation on retail pricing, the operators are required to respect the additional
obligations for transparency and consumer safeguards, such as:
• Sending their customers an information message on tariffs for voice and SMS, each time a
user finds himself in a situation of international roaming, as well as the rates of service data
as soon as they are used in roaming for the first time in a member state.
• Sending notification to the roaming customer when the customer has consumed all the voice
services volume, SMS, or data corresponding to a reasonable use, as and when reasonable
use regulation is implemented.
• Blocking data services automatically upon exhaustion of data the roaming fair usage limit.
iv. Gulf Cooperation Council Roaming Regulation
The Cooperation Council for the Arab States of the Gulf, originally known as the GCC, is
a regional intergovernmental political and economic union consisting of all Arab states of the Persian Gulf,
except Iraq. Its member states are Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab
Emirates (Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah, Ajman, Umm Al Quwain, and Fujairah). The roaming
regulation initiatives in GCC countries have almost followed a similar schedule as the EU reforms, as seen
in figure 27.
Figure 27. GCC and EU Roaming Rates Reduction Schedules
55
IMR has been a topic of intense discussion and concern in the GCC region. In response to these concerns,
the GCC Ministerial Committee implemented a roaming regulation in 2010, which introduced price caps
on the retail and wholesale levels for calls made within the visited country (local calls) and on calls made
to other GCC member states (international calls), including the home country.
More recently, the GCC ministers have called for an assessment of the effectiveness of the existing
regulation and a review of all other IMR services (including data, voice calls received, SMS, picture/video
messaging, and video calls) to determine whether further regulation is needed. Accordingly, the GCC
Roaming Working Group (RWG) has finalized a report 48 after a public consultation held in September
2014. The GCC Ministerial Committee for Post, Telecommunications and Information Technology
approved the recommended regulations in its 24th meeting of June 9, 2015 held in Doha, Qatar.
They concluded that retail and wholesale price controls are effective approaches to achieve lower roaming
prices. To avoid any disruption to operator revenues and profits, the glide path approach toward the
desired retail and wholesale price caps was adopted. Wholesale price caps apply as of January each year
and retail price caps apply as of April each year, to enable the GCC regulatory authorities to ensure that
wholesale price caps are implemented before the retail prices that depend on them. The wholesale price
caps for the different international roaming services were determined based on a calculation that started
from the underlying cost estimates of the visited network in 2012 and allowing a sufficient markup that
exceeds any reasonable measures of the weighted average cost of capital. Home network operators are
subject to the retail price caps, which were set to cover the wholesale payments to the visited network
(wholesale roaming charges) plus a markup at a level reasonably above other incurred costs. For some
types of roaming services (such as incoming voice calls), the price cap also covers other costs incurred by
the home network, including traffic termination and international transit.
In addition to the price controls, the RWG report proposes the adoption of several supporting measures,
such as:
• Collection of statistics. The report proposes to initiate a biannual comprehensive collection of data
associated with the provision of roaming services (and termination rates).
• Billing increment. The RWG proposes the adoption of regulation on maximum billing units: per minute
for voice and per MB for data offers based on volume of usage.
• Measures to reduce bill shock. The RWG proposes the adoption of bill-shock warning measures
(typically by means of SMS) for consumers when their usage approaches a threshold, and to cut off
the service when the threshold is exceeded unless the consumer signals a desire to continue.
• Long-Term Evolution (LTE) local breakout. One characteristic of LTE roaming is the possibility of local
breakout. The working group has proposed mobile network operators (MNOs) to explore this feature.
This technical option allows the visited network to hand off data traffic to the Internet directly without
the need for traffic to be hubbed back to the home network. Therefore, LTE roaming would potentially
reduce the costs of data roaming substantially by eliminating the need for international connectivity
between the home and visited networks. Such measures (excluding LTE breakout) currently have only
been implemented by MNOs in Oman.
56
e) Recommendations
Mobile network operators in the ECOWAS region have taken significant steps toward developing the
regional roaming market, by adopting success models that they had tested in other regions of
operations. However, international cases have demonstrated that effective and harmonious
development of a regional roaming market requires policy and regulatory interventions with a clear
timeline or glide path addressing fundamental prerequisites. This study of the roaming market in
ECOWAS has highlighted that a significant number of challenges facing the sector can be addressed
through legal, policy, and regulatory interventions at the national and regional levels. This subsection
lists key recommendations for developing affordable regional international roaming in ECOWAS.
Increase harmonization of the markets across the region. There is high variation among ECOWAS
member states across all the mobile sector measures, such as retail tariffs, roaming plan availability,
wholesale connectivity prices, MTR regimes, and so forth. For the broader purpose of regional
integration, the ICT sectors across member states would need greater coordination and harmonization.
This entails addressing inherent challenges and distortion in the sector at the national level that lead to
low coverage and affordability of services. Development of the roaming market, which is comprised of
wholesale and retail voice and data elements, to promote affordable regional roaming requires
implementation of a combination of targeted and sector-wide legal, regulatory, and policy interventions.
Key areas that can have significant impact are
• Liberalizing international gateways. International voice and data connectivity is essential for
roaming. Liberalized international gateways are the cornerstone of a well-functioning
international connectivity market that promotes open and nondiscriminatory access.
Additionally, being the most upstream element of the broadband value chain, the economic
impact of liberalized international gateways can be significant for consumers of domestic data
services as well as for international roaming.
• Promoting cross-border interconnection. As examined in section II, terrestrial cross-border
linkages are not only critical for landlocked countries, but also promote competition in the
international connectivity market of coastal economies with international connectivity through
submarine cables. Promoting greater cross-border connectivity for voice and data services can
enable smaller mobile operators to remain competitive in the roaming market where they tend
to remain in a net payable situation.
• Addressing SMP. The mobile communications market is highly concentrated at the national and
regional levels. This is also true for the overall digital infrastructure market. Addressing SMP at
the national level, in the mobile and wholesale markets, while adhering to standardized regional
principles should be a priority for regulators. Globally, competition stimulation is a common
priority identified across critical components of the digital sector.
• Promoting open access across the value chain. Open and nondiscriminatory access to services
across communications value chains promotes competition and innovation in services. As the
sector goes through greater regional integration, by building on regional infrastructure
57
development and regulatory harmonization efforts, the principle of open and nondiscriminatory
access should be followed across all the elements of the value chain in the sector.
Engage in dialogue with the private sector. The ECOWAS Commission could facilitate periodic
consultations between national regulatory authorities, governments, and mobile operators to
understand sector challenges and bottlenecks to offering affordable roaming. Additionally, this would
provide a platform for the national regulatory authorities to encourage mobile operators to upgrade
their technical infrastructure to facilitate real-time roaming billing so as to address consumer concerns
related to bill shock. The challenges faced by the larger and smaller MNOs in the region can be diverse,
particularly in the roaming market. Hence, the national regulatory authorities would benefit greatly
from a range of insights through periodic private sector consultations on the topic.
Select a retail pricing model for regional roaming. A decision should be taken at a regional level, in
consultation with the private sector, on the retail pricing model to be adopted for regional international
roaming. With the larger operators already moving to the Roam Like at Home model, it may serve as the
basis for a harmonized regional retail pricing model.
Develop a regional roaming strategy and glide path. Upon selection of the appropriate pricing model, a
detailed strategy with guidelines and a glide path for prices in key markets should be developed. The
private sector’s initiative in offering roaming-specific retail plans is a positive step that indicates
recognition of the potential of this market. Price reduction is bound to have a negative impact on MNO
revenues in the short run; hence, it is necessary to follow a gradual glide path that addresses the retail
and wholesale markets and is supported with the necessary legal, policy, and regulatory environment.
Enforce transparency and consumer information measures. In addition to the interventions targeting key
markets within the sector, raising consumer awareness and transparency of roaming pricing should be a
priority. International cases provide several examples of initiatives and good practices that can be
adopted at the regional level by ECOWAS and enforced through national regulatory authorities. These
measures could include mandatory publication of clear retail roaming tariffs on MNO websites, SMS
notification of roaming tariffs upon arrival in a visited country, education on fair usage limits, and so
forth.
IV. Conclusion Economies of scale and network effects are critical to drive growth of the digital economy, starting from
telecommunications infrastructure and services. This is particularly pertinent for several of the ECOWAS
countries that are too small in isolation to pursue development of a digital economy, and the majority of
individuals in the ECOWAS region remain disconnected from the Internet. In addition to its large size,
the inherent heterogeneity in the ECOWAS region further increases the importance of developing
subregional linkages. For example, the West African Economic and Monetary Union offers an
opportunity for a subset of ECOWAS member states to forge stronger partnerships in developing their
digital economies. Yet, there are overarching principles to which all countries should adhere, including
on their borders. The principles can be grouped in the following manner:
58
• Regional licensing. The shift from national to regional licenses of operators, including alternative
utility and transport operators, could accelerate regional expansion and potentially draw more
competition into parts of the region.
• Liberalization and competition. There are likely to be instances where there will be natural
monopolies, particularly the long-distance wholesale providers (or carrier’s carrier). The region
currently lacks frameworks for competition policy and SMP regulation, which has led to a
situation where dominant behavior is largely left unchecked.
• Open access and infrastructure sharing. Policies and regulations that promote the use and
sharing of infrastructure, including infrastructure sharing, rights of way, and colocation, would
encourage efficient use of infrastructure and allow smaller operators to participate in cross-
border communications. This would also include the alternative infrastructure providers.
• Transparency in tariff information. Increasing the visibility of retail prices would protect
consumers from bill shock and could encourage the use of cross-border communications if
consumers are able to understand the pricing system beforehand. Transparency of wholesale
prices (RIOs) together with the other open access principles could be further catalytic for
efficient utilization of infrastructure.
• Aggregation and localization of content. In parallel to easing voice and data traffic across
borders, the region would benefit from an effort to keep regional traffic regional. Whereby even
those countries that do not have robust and secure data infrastructure, such as IXPs and data
centers, could host their content in another country within the region that has these
capabilities.
• Capacity building of regulators. The ECOWAS member states are on different rungs of the digital
economy ladder, much of which depends on the size of the market, but also the capacity of the
relevant institutions. The transposition of the regional supplementary acts, for example, can be
a complex process involving multiple agencies, laws, and regulations. Capacity building of
regulators and other agencies would be needed in specific areas, whether it be licensing or
pricing regulations.
A collaborative approach to the digital economy would help deepen existing socioeconomic ties and
circumvent the potential widening of the digital divide between countries. The region has seen
significant investments in the infrastructure, and further deployment is required to achieve universal
coverage objectives and reinforce the robustness of regional networks. The next challenge is to get the
enabling environment right for voice and data transmission across borders. This would lay the
foundation for the production of digital content—digital government services, financial services,
entertainment, and innovation—that is pertinent to the people and businesses of the West Africa
region.
1 FTTx stands for “fiber to the x,” whether residential, commercial, or other types of buildings or facilities. 2 GSMA Mobile Economy West Africa, 2018.
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3 Study on Policies to Reduce Mobile Roaming Rates, prepared by Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. 4 https://www.mobileworldcongress.com/session/a-new-roaming-era-breaking-down-digital-borders/. 5 There is no regulated price for data in the One Network Area yet. 6 Bahrain, or the Kingdom of Bahrain; Kuwait; Oman, or the Sultanate of Oman; Qatar; Saudi Arabia, or the Kingdom of Saudi Arabia; and the United Arab Emirates. 7 Examples include New Zeeland and Australia, Singapore and Malaysia, and Singapore and Brunei, but also the One Africa Network initiative, binding to 11 countries across Africa under the Smart Africa Initiative. 8 http://www.itu.int/en/ITU-D/Regulatory-Market/Pages/Roaming_info.aspx. 9 GSMA Intelligence, The Mobile Economy: West Africa, 2018. 10 GSMA Intelligence, The Mobile Economy: West Africa, 2018. 11 FTTx stands for ‘fiber to the x’, whether residential, commercial or other types of building or facility. 12 Source: World Bank. 13 Source: UN COMTRADE. 14 Some analytical works include: “West African Common Market Project: Harmonization of Policies Governing the ICT Market in the UEMOA-ECOWAS Space,” International Telecommunication Union and European Union, 2005; “Regionalizing Telecommunications Reform in West Africa,” World Bank, 2007; and “ECOWAS Regional Infrastructure Development Master Plan,” ECOWAS Commission, 2016. 15 This study draws and adapts from the “Missing Links and Infrastructure Sharing Study” prepared by a team of consultants: Claude de Jacquelot, Mike Jensen, Bernard Sanchez, Rémy Fekete, Ananda Covindassamy, David Guitton, and Iheb Nomme; and the “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. 16 The SAT-3/WASC cable system became operational in 2001 and connects Portugal, Spain, Canary Islands (Spain), and Senegal. Then to Côte d'Ivoire, Ghana, Benin, Nigeria, Cameroon, Gabon, Angola, and South Africa. In South Africa, the cable system connects to the South Africa Far East linking it to Malaysia. 17 Main One currently connects Portugal, Ghana, and Nigeria (Lagos); there are reported plans to connect Morocco, Canary Islands (Spain), Senegal, Côte d'Ivoire, Nigeria (Bonny), Gabon, the Democratic Republic of Congo, Angola, South Africa, and Namibia. 18 The ACE cable system connects France, Portugal, Morocco, Canary Islands (Spain), Mauritania, Senegal, The Gambia, Guinea, Sierra Leone, Liberia, Côte d'Ivoire, Ghana, Benin, Nigeria, São Tomé and Príncipe, Cameroon, Equatorial Guinea, Gabon, the Democratic Republic of Congo, Angola, Namibia, and South Africa. The World Bank supported the initial connection costs for Benin, The Gambia, Guinea, Sierra Leone, Liberia, and São Tomé and Príncipe. 19 Assessment of where a country is in terms of implementation and enforcement is a complex task, as they have been transposed in a disparate manner through various legal and regulatory instruments. 20 https://stats.oecd.org/glossary/detail.asp?ID=6755 (accessed January 24, 2018). 21 https://stats.oecd.org/glossary/detail.asp?ID=6755. 22 GSMA Mobile Economy West Africa, 2018. 23 “Study on Policies to Reduce Mobile Roaming Rates,” prepared by Olivier Jacquinot, Katia Duhamel, Laurent Cohen, and Russel Southwood. 24 https://www.mobileworldcongress.com/session/a-new-roaming-era-breaking-down-digital-borders/. 25 Regional market share is calculated as the total number of subscribers for each mobile operator in the entire ECOWAS region divided by the total number of mobile subscribers in all ECOWAS countries. 26 All retail prices are converted to U.S. dollars in purchasing power parity according to 2015 International Monetary Fund data (https://www.imf.org/external/pubs/ft/weo/2016/01/weodata/index.aspx). 27 There are no regulated price for data in the East Africa One Network Area yet. 28 https://bics.com/roaming-and-bics-take-centre-stage-at-mobile-world-congress-in-live-panel-session/. 29 PPP exchange rates ae from the International Monetary Fund database. 30 Nigeria increased the international termination rate (ITR) from ₦3.9 to ₦24.9 in September 2016. The rationale, as mentioned by Nigerian Communications Commission (NCC) in the decision (Public Notice - Review of International Termination Rate, Nigerian Communications Commission, October 5, 2016) was that “in comparison with other African countries’ ITR, Nigeria’s termination rate at $0.03 [is] relatively too low and this will likely impact negatively on the inflow of revenue to the Nigerian economy.” The case of Ghana, which increased ITR
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from US$0.10 to US$0.19 in 2009, and Uganda, imposing a tax of US$0.09 on inbound international calls that substantially increases ITR were cited by NCC. Additionally, it was observed that “while regulatory authorities tend to protect service providers and consumers, telcos and the government would prefer higher rates that brings in hard currency and can fund investment, expand domestic network, fund innovation and improve quality of service.” 31 Ibid. 32 “ITU Regional Economic & Financial Forum of Telecommunications/ICT for Africa International Roaming, SADC Perspective,” Mr. Leweng Mphahlele, Manager, Economic & Financial Analysis, Independent Communications Authority of South Africa. 33Bahrain, or the Kingdom of Bahrain; Kuwait; Oman, or the Sultanate of Oman; Qatar; Saudi Arabia, or the Kingdom of Saudi Arabia; and the United Arab Emirates. 34 ITU, “Charging in International Mobile Roaming Service,” September 2012, https://www.itu.int/rec/T-REC-D.98-201209-I/fr. 35 As examples: New-Zealand and Australia, Singapore and Malaysia, and Singapore and Brunei, but also the One Africa Network initiative, binding 11 countries across Africa under the Smart Africa Initiative. 36 OECS comprises nine member states: Antigua and Barbuda, Dominica, Grenada, Montserrat, St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines, Anguilla, Martinique, and the British Virgin Islands. The Eastern Caribbean Telecommunications Authority Council of Ministers has announced it will look closely at the possibility of eliminating roaming charges within the OECS territories by 2017. http://dominicanewsonline.com/news/homepage/news/technology/ectel-explores-the-elimination-of-roaming-charges-in-oecs/. 37 http://www.itu.int/en/ITU-D/Regulatory-Market/Pages/Roaming_info.aspx. 38 Bharti Airtel acquired Zain in 2010. 39 http://www.nciprojects.org/sites/default/files/downloads/5th%20Joint%20communique.pdf. 40 “One Network Area in East Africa,” Tim Kelly, World Bank Group, and Christopher Kemei, Communications Authority of Kenya, 2016. 41 http://www.pcworld.com/article/2905792/east-africa-expands-one-network-area-to-include-data-mobile-money.html. 42 All data are from “A Case Study of ONA: East Africa One Network Area Roaming Initiative,” ITU report, 2016. 43 All data are from “A Case Study of ONA: East Africa One Network Area Roaming Initiative,” ITU report, 2016. 44 The implementing countries include Côte d’Ivoire, Gabon, Kenya, Mali, Uganda, Senegal, South Sudan, Chad, Rwanda, and Burkina Faso. 45 Comprising Angola, Botswana, the Democratic Republic of Congo, Lesotho, Malawi, Mauritius, Madagascar, Mozambique, Namibia, the Seychelles, South Africa, the Kingdom of Eswatini., Tanzania, Zambia, and Zimbabwe. 46 http://www.crasa.org/crasa-content/id/74/crasa-roaming-task-team/. 47 Commission Implementing Regulation (EU) 2015/2352 of 16 December 2015 setting out the weighted average of maximum mobile termination rates across the Union. 48http://www.cra.gov.qa/sites/default/files/Final%20Consultation%20Report%20%20-%20International%20Mobile%20Roaming%20%28IMR%29%2020150621.pdf.