Policy Choices Can Help Keep 4G and 5G Universal Broadband Affordable
Edward J. Oughton, Niccolò Comini, Vivien Foster, Jim W. Hall
Abstract
The United Nations Broadband Commission has committed \nthe international community to accelerate universal \nbroadband, but the cost of meeting these objectives in the \ncontext of rapid technological change are not well understood. \nUsing scenario analysis, this paper compares the \nglobal cost-effectiveness of different infrastructure strategies \nfor the developing world to achieve universal 4G or 5G \nmobile broadband. Utilizing remote sensing and demand \nforecasting, least-cost network designs are developed for \neight representative low- and middle-income countries \n(Malawi, Uganda, Kenya, Senegal, Pakistan, Albania, Peru, \nand Mexico), which provide the basis for aggregation to \nthe global level. The cost of meeting UN Broadband Commission \ntargets across the developing world is estimated \nat $1.6-1.7 trillion over the next decade, approximately 0.5-0.6% of annual gross domestic product for the developing \nworld over the next decade. However, by creating a \nfavorable regulatory environment, governments can bring \ndown these costs by as much as three-quarters – to US$0.5 \ntrillion (around 0.15 percent of annual gross domestic product) \n– and largely avoid the need for public subsidies. While \n4G technology remains somewhat more cost-effective at the \nglobal scale, 5G NSA can sometimes prove less costly at \nthe national level, particularly for countries with relatively \nlow existing coverage of 4G technologies, and a tendency \nto be capacity-constrained in terms of demand. Providing \nthat governments make judicious choices, adopting fiscal \nand regulatory regimes that are conducive to lowering costs, \nuniversal broadband may be within reach of most developing \ncountries over the next decade.