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Public Private Partnerships

Azerbaijan's broadband at a crossroads

Natalija Gelvanovska-Garcia's picture
View of Baku, Azerbaijan. Photo: David Davidson/flickr

Geographically and historically, Azerbaijan has often been at the crossroads: of trade routes, cultures, and influences. From a telecom policymaking standpoint, the country is currently at another important crossroad - this time having to choose from available regulatory approaches designed to pave the way for the high-speed broadband roll-out across the country.
 
Which regulatory framework is best to follow? Which country experience is closest to the needs of the Azerbaijani population and could provide for not only rapid but, more importantly, self-sustaining broadband market development?

Over the last year I had a chance to analyze the Azerbaijani broadband market, with my objective being the formulation of advice on the best way to stimulate the broadband market growth. In this blog I would like to briefly outline two relevant models of fixed broadband market development, either of which, from a quick glance, could be considered appealing for Azerbaijan because of a positive market growth trajectory and low consumer prices (the full analysis will be published soon). The models I am referring to are competition-led and government-led market development approaches, in the analysis they are represented by experiences of two oil-exporting economies, similar to Azerbaijan - Norway and Qatar.
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Connectivity equals opportunity: PPPs narrow the "broadband gap"

Pierre Guislain's picture
A billboard announces the arrival of high-speed broadband internet
in downtown Nukua'lofa, the capital of Tonga. Photo: Tom Perry / World Bank
You don’t need to be a grandparent or even have a particularly long memory to recall a time when information and communications technology (ICT) devices were luxuries only a few could afford, if not something lifted entirely from the pages of science fiction. Reform of the ICT sector happened fast, both in broadband and mobile, and we all feel it in our personal and professional lives. The extraordinarily rapid uptake of mobile telephony in developing countries is the most compelling element of the
ICT story, but it’s only partly about the technology itself.

The real plot twist lies in why reform took off so quickly. Simply put, the incumbents did not see mobile services as threatening. Telecom companies thought of it as a fancy, add-on service that would be useful for rich people but unthreatening to the standard business model. However, the new technology was able to fill gaps in countries where there was no service at all, and it was able to make very rapid inroads. Elsewhere, people would have gone through a more traditional rollout of fixed network and then mobile; in developing countries, mobile became the main service because incumbent service was so poor. Mobile moved in because the incumbents had not done their job.

This shows that the most important element of progress in ICT is the creation of an environment where competition can flourish. Public-private partnerships (PPPs) are key players in this chapter of the ICT narrative. We see this in articles and interviews throughout Handshake, which examines PPPs in broadband and mobile/telecom (which together comprise our definition of ICT) and the services this infrastructure makes possible. In other words, we’re looking at PPPs whose infrastructure creates connections and whose services deliver connectivity.