Policy Action

Since becoming the first African country to fully liberalise the communications and broadcasting sector in 1993, under the Tanzanian Communications Act, the government has been undergoing a number of policy reforms in order to attract investment and increase competition. The Tanzania Communication Regulatory Authority (TCRA) was established in 2003 under the Tanzanian Regulatory Act No. 12 to regulate the electronic communications sector, and eventually resulted in the introduction of the Converged Licensing Framework (CLF) as the key strategy to implement liberalisation.

 

Among the objectives of the CLF are to encourage the growth of new applications and services, simplify existing licensing procedures to ease market entry, and maintain a proactive and flexible legal framework that can keep pace with rapidly changing technology. More importantly, the CLF mandates that licenses have to interconnect, and enables Tanzania to achieve a technology-neutral and service-neutral framework. This type of framework seeks to ensure that no one entity can take a position of dominant market power, and enables anyone to connect to anyone, which in turn encourages innovation, low-cost delivery to users, and market entry from smaller, local companies.

 

Another area of focus that is outlined in the NICTP specifically targeted at bridging the digital divide between rural and urban areas, is the Universal Communications Services Access Act. The Act, which established the Universal Communications Service Access Fund (UCSAF) in 2007, affirms that communication is a universal right and should be accessible to the entire population, while also acknowledging that not all areas are economically viable for operators, due to the high cost of rural telecommunication provision, unreliable or unavailable power supplies, and lower-income earners in rural and economically weak areas. To help bridge this rural-urban digital divide, the NICTP mandates that the government allocate funds for supporting rural ICT investment, strengthen collaboration with service providers to participate in rural ICT investments, ensure access to ICT products and services to society, and encourage financial institutions and development partners to give particular support for investments in rural ICT services.

Results & Insight

The combination of the submarine cables and the government’s investment in the NICTBB significantly reduced the cost of backhaul transport bandwidth by about 99% compared to the expensive satellite bandwidth that had to be used for local and international communication prior to 2009.

 

However, despite commendable efforts by the government to guide the deployment of ICT infrastructure, including infrastructure sharing and subsidies provided through UCSAF, internet penetration has not grown at a desirable pace. Issues of affordability remain and with 69% of the population living in rural areas where access is limited or non-existent, more investment is still required to connect these large sections of society.

 

With that said, Tanzania’s mobile industry is making significant contributions to help transform the country’s digital economy. In 2016, mobile network operators (MNOs) Airtel, Milicom, and Vodacom launched an infrastructure sharing initiative, in collaboration with GSMA and the government, to expand mobile broadband coverage to 13 million underserved people across rural areas of Tanzania. As part of this programme, the MNOs agreed to deploy mobile services to six pilot sites across the country. 

 

The results of this network sharing trial revealed benefits on both the supply and demand side. The tripartite national roaming agreement, which was the first of its kind in Africa, allowed the MNOs to deploy multiple products, including 3G mobile broadband, at a significantly lower cost to rural areas through a single infrastructure deployment. This resulted in healthy revenues of US$5,200 on average, per month per site, validating the sustainability of the roaming model. In turn, customers benefited from competitive offerings from all three operators. Within the first four months of the pilot, both mobile service adoption and data service adoption levels around the pilot sites reached national averages of 65% and 17%, respectively. This indicates a strong appetite for mobile services in these underserved areas, particularly for population groups working in education and business, who are enabled through access to information currently unavailable in their vicinity. The most notable challenges were related to power supply issues and equipment failure due to weather conditions that affected the quality of service and reliability. This is an area in which the mobile industry must continue to work with public and private partners in the power and solar industry to identify and implement innovative and sustainable solutions to enable rural areas to access mobile communication at a low cost.

 

As Tanzania continues to seek to accelerate ICT development for all, a huge digital divide persists that will require the continued collaboration of licensed operators to address gaps in last-mile infrastructure. Additionally, as issues of coverage become addressed, the government must remain proactive by implementing policies that seek to address potential secondary digital divides such as literacy, digital skills, and availability of relevant content.

Full Story

Since the arrival of SEACOM and EASSY — two international underwater fibre optic cables that connect Tanzania to a major internet backbone — to Dar Es Salaam in 2009, the country has been proactive in extending the fibre infrastructure from sea to land. With a desire to enhance the use of ICT applications for sustainable socio-economic development for the entire Tanzanian population, the government constructed a national fibre optic cable network, named the National ICT Broadband Backbone (NICTBB), to achieve the vision of extending opportunities for internet access inland. The government of Tanzania also fulfilled its commitment to extend the backbone to landlocked countries and bordering points along Burundi, Malawi, Kenya, Rwanda, Uganda, and Zambia, and has become a vital hub of ICT infrastructure and solutions in the region.

 

Starting in 2009, Tanzania’s government laid more than 10,000 kilometres of fibre optic cable — divided into three rings (Northern, Southern, and Western) — that connects all of Tanzania’s major urban centres, and provides points of presence (PoPs) to connect with other networks that extend into the country’s rural areas. The government then enacted policies to encourage nationally licensed operators to interface with the government-owned backbone and to focus on building out last-mile infrastructure.

 

Tanzania’s main policy framework for guiding the growth and development of its ICT landscape is its 2003 National ICT Policy (NICTP), and the subsequent NICTP 2016 revision. The NICTP recognises the critical role of ICTs in driving the social and economic transformation necessary for Tanzania to achieve its goal of becoming a middle-income country by 2025 (as laid out in the country’s Development Vision 2025). A key challenge to ubiquitous national development has been establishing and maintaining a proactive legal framework to enforce the National ICT Policy’s goals of enabling a competitive and innovative environment, attracting public-private partnership (PPP) investment in the sector, and ensuring that telecommunications networks are extended to rural areas.

 

Since becoming the first African country to fully liberalise the communications and broadcasting sector in 1993, under the Tanzanian Communications Act, the government has been undergoing a number of policy reforms in order to attract investment and increase competition. The Tanzania Communication Regulatory Authority (TCRA) was established in 2003 under the Tanzanian Regulatory Act No. 12 to regulate the electronic communications sector, and eventually resulted in the introduction of the Converged Licensing Framework (CLF) as the key strategy to implement liberalisation.

 

Among the objectives of the CLF are to encourage the growth of new applications and services, simplify existing licensing procedures to ease market entry, and maintain a proactive and flexible legal framework that can keep pace with rapidly changing technology. More importantly, the CLF mandates that licenses have to interconnect, and enables Tanzania to achieve a technology-neutral and service-neutral framework. This type of framework seeks to ensure that no one entity can take a position of dominant market power, and enables anyone to connect to anyone, which in turn encourages innovation, low-cost delivery to users, and market entry from smaller, local companies.

 

Another area of focus that is outlined in the NICTP specifically targeted at bridging the digital divide between rural and urban areas, is the Universal Communications Services Access Act. The Act, which established the Universal Communications Service Access Fund (UCSAF) in 2007, affirms that communication is a universal right and should be accessible to the entire population, while also acknowledging that not all areas are economically viable for operators, due to the high cost of rural telecommunication provision, unreliable or unavailable power supplies, and lower-income earners in rural and economically weak areas. To help bridge this rural-urban digital divide, the NICTP mandates that the government allocate funds for supporting rural ICT investment, strengthen collaboration with service providers to participate in rural ICT investments, ensure access to ICT products and services to society, and encourage financial institutions and development partners to give particular support for investments in rural ICT services.

 

The combination of the submarine cables and the government’s investment in the NICTBB significantly reduced the cost of backhaul transport bandwidth by about 99% compared to the expensive satellite bandwidth that had to be used for local and international communication prior to 2009.

 

However, despite commendable efforts by the government to guide the deployment of ICT infrastructure, including infrastructure sharing and subsidies provided through UCSAF, internet penetration has not grown at a desirable pace. Issues of affordability remain and with 69% of the population living in rural areas where access is limited or non-existent, more investment is still required to connect these large sections of society.

 

With that said, Tanzania’s mobile industry is making significant contributions to help transform the country’s digital economy. In 2016, mobile network operators (MNOs) Airtel, Milicom, and Vodacom launched an infrastructure sharing initiative, in collaboration with GSMA and the government, to expand mobile broadband coverage to 13 million underserved people across rural areas of Tanzania. As part of this programme, the MNOs agreed to deploy mobile services to six pilot sites across the country. 

 

The results of this network sharing trial revealed benefits on both the supply and demand side. The tripartite national roaming agreement, which was the first of its kind in Africa, allowed the MNOs to deploy multiple products, including 3G mobile broadband, at a significantly lower cost to rural areas through a single infrastructure deployment. This resulted in healthy revenues of US$5,200 on average, per month per site, validating the sustainability of the roaming model. In turn, customers benefited from competitive offerings from all three operators. Within the first four months of the pilot, both mobile service adoption and data service adoption levels around the pilot sites reached national averages of 65% and 17%, respectively. This indicates a strong appetite for mobile services in these underserved areas, particularly for population groups working in education and business, who are enabled through access to information currently unavailable in their vicinity. The most notable challenges were related to power supply issues and equipment failure due to weather conditions that affected the quality of service and reliability. This is an area in which the mobile industry must continue to work with public and private partners in the power and solar industry to identify and implement innovative and sustainable solutions to enable rural areas to access mobile communication at a low cost.

 

As Tanzania continues to seek to accelerate ICT development for all, a huge digital divide persists that will require the continued collaboration of licensed operators to address gaps in last-mile infrastructure. Additionally, as issues of coverage become addressed, the government must remain proactive by implementing policies that seek to address potential secondary digital divides such as literacy, digital skills, and availability of relevant content.