May 30, 2024
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March 17, 2022

Global broadband cost soars on COVID spikes

By Upfrontdigital News 0 332 Views

By Adeyemi Adepetun

THE International Telecommunications Union (ITU) and the Alliance for Affordable Internet (A4AI) have revealed that COVID-19 pandemic caused a major spike in the prices of broadband services across the globe in 2021.

   The bodies noted that Internet connectivity became less affordable around the world in 2021.

   Specifically,  ITU stressed that consumers in low- and middle-income economies typically paid five to six times more, relative to their income, to use information and communication technology (ICT) services than consumers in high-income economies did in 2021.

   According to ITU-A4AI policy brief​, The affordability of ICT services 2021, the share of people’s incomes spent on fixed broadband and mobile Internet services increased globally last year, in parallel with upticks in demand and usage compared to 2020

  It pointed out that relative prices of fixed broadband services climbed to 3.5 per cent of gross national income (GNI) per capita globally in 2021, up from 2.9 per cent in 2020. The relative prices of mobile broadband services around the world also edged up to two per cent of GNI per capita, from 1.9 per cent a year earlier.

   ITU noted that yet people have sacrificed other goods and services to maintain reliable Internet access during the COVID-19 pandemic, adding that those who can have largely stayed connected, even at relatively higher prices.

   ITU Secretary-General, Houlin Zhao, said broadband services have ceased to be a mere luxury, adding, “they are a necessity for communication, teleworking, online education, and other essential services. Still, we must urgently address the issue of affordability if we hope to achieve our goal of universal and meaningful connectivity.”

   Zhao said affordability gaps have persisted or widened over the past year. It pointed out that fewer economies now meet the affordable cost target of two per cent of monthly GNI per capita for entry-level broadband service, as set out by the United Nations Broadband Commission.

He stressed that consumers in low- and middle-income economies typically paid five to six times more, relative to their income, to use information and communication technology (ICT) services than consumers in high-income economies did in 2021.

   At the regional level, ITU said users in Africa paid more than three times the global median price for mobile broadband services, and over five times the global median for fixed broadband.

   Executive Director of A4AI, Sonia Jorge, said the affordability gap for Internet access between those living in low- and middle-income countries and those living in high income countries is inexcusably high.

   “Moreover, people in rural areas, and women everywhere, are disproportionately affected. A continued failure to address this worsens the situation for those who need help the most. The public and private sectors must work together to connect humanity with affordable and meaningful access,” Jorge added.

   Speaking on elusive affordability targets, ITU claimed that worldwide, only 96 economies met the UN Broadband Commission target for the prices of data-only mobile broadband prices in 2021, seven fewer than in 2020. It stressed that at the same time, only 64 economies met the Commission’s target for fixed-broadband prices, down by two from 2020.

    Director of ITU’s Telecommunication Development Bureau, Doreen Bogdan-Martin, informed that these findings are a warning sign, and significant improvement is needed as the Broadband Commission’s 2025 target date for achieving global broadband affordability edges ever closer.

    “The past few years have proven that connectivity is vital. As we move to post-pandemic recovery, we need to make connectivity affordable for everyone to ensure that we leave no one behind in this digital era,” she stated.

   According to the body, among the world’s 46 least developed countries, entry-level fixed or mobile broadband Internet costs less than two per cent of GNI per capita in only four cases: Bangladesh, Bhutan, Myanmar, and the Republic of Nepal.

  Bucking pre-COVID price trends, ITU said fixed broadband services saw the highest jump, with prices increasing by eight per cent last year.

   It said this meant fixed broadband became less affordable for many users, with relative prices climbing from 2.9 per cent of GNI per capita in 2020 to 3.5 per cent in 2021. The price of mobile broadband services also increased slightly, from 1.9 to 2.0 percent of GNI per capita worldwide.

   Historically, global demand for broadband services and their overall affordability have appeared to climb hand in hand, with price drops typically prompting more subscriptions.

   Even with last year’s price rises, both data usage and the number of fixed and mobile broadband subscriptions continued growing globally, suggesting people were cutting other expenses to be able to keep using the Internet.

   To some extent, the relative price increase for broadband services reflects a global economic downturn triggered by the COVID-19 pandemic. Many countries have seen GNI reductions, offsetting gains for consumers even where prices declined.

   On the positive side, broadband operators in many countries increased the data allowance included in their benchmark baskets. Users who could afford those baskets, therefore, received greater value for money.

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