Papua New Guinea’s Ambitious National Telecoms Plan

Via LinkedIn, an interesting look at Papua New Guinea:

Although rich in natural resources, Papua New Guinea is one of the world’s less developed countries. From low to high, its GDP per capita ranks 50th out of 188 countries, its fixed-line teledensity ranks 41st out of 210 countries, and its mobile penetration ranks 17th out of 205 countries.

Papua New Guinea is little urbanised, with some 80% of the population living in isolated, scattered settlements, where rugged terrain, extensive swamplands, and fast-flowing rivers make it difficult to deliver basic services. Many tribes in the mountainous interior have little contact with the outside world and subsist on a non-monetised economy. Culturally, PNG is extremely diverse, with more than 700 native tongues spoken. The country is prone to natural disasters such as volcanic activity, earthquakes, tropical cyclones, tidal waves, landslides, and flash flooding. Infrastructure is frequently damaged or destroyed. Illiteracy, poverty, and income inequality are high. Corruption and crime are rife. Outbreaks of tribal fighting are more and more lethal since the introduction of modern weapons. Mobile phones are used to coordinate tribal wars as well as criminal activities.

In this scenario, ICT development is obviously a challenge. The government hopes to bridge the digital gap by deploying a National Transmission Network (NTN), incorporating new fibre-optic, microwave, and satellite links as well as the existing infrastructure owned by the state-owned incumbent Telikom. The NTN will be managed by state-owned PNG DataCo, which will act as wholesaler, leasing bandwidth to any service provider at non-discriminatory conditions.

Telikom will be compensated for the loss of its network and restructured to operate purely at the retail level. Ultimately, the aim is to produce a shift in the telecom industry from vertical to horizontal integration. Besides involving duplication of infrastructure, the traditional vertically integrated business model lacks the flexibility and dynamism required in a competitive and changing environment. The NTN is designed to eliminate duplications and take advantage of market synergies.

There are interesting similarities between Papua New Guinea’s NTN and the National Broadband Network in neighbouring Australia. Yet, the social and economic backgrounds are very different. The question cannot help but arise – will the NTN be implemented successfully? Or is it a pie in the sky destined to drown in a quagmire of inefficiency, nepotism, political wrangles, and general corruption?

With a population of more than 7 million people and underdeveloped telecom services, PNG’s telecom market has enormous growth potential. More and more Papuans are embracing the digital age, particularly the younger generation. The country really does need to lift its ICT game. Maybe it does have what it takes. In 2015, PNG is expected to be the best performing country in the world, with a GDP growth rate of 19% – the highest growth rate globally.

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