28 July 2017

South Africa: Low-Cost Comms Co-Op Zenzeleni Networks Provides Cheaper Voice and Data for Village Community

London — South Africa's University of the Western Cape set out to see whether it was possible to seed a micro-communications organization in a local community. The difference with most initiatives of this kind was that it wanted the local community to take on running the organization. Russell Southwood talked to Carlos Rey-Moreno, Faciltator of Zenzeleni Networks.

The idea for Zenzeleni Networks came about through a combination of factors and the meeting of several like minds:" I had experience of wireless connectivity, open source and long distance communications. I had worked with an NGO in Peru and Colombia on these issues".

"I met Bill Tucker (UWC Department of Computer Science) at a conference and he was doing telemedicine. I was talking to Steve Song about his Village Telco idea and wanting to do a bottom-up approach. We wanted to put tech in the hands of people and wanted to try this in the rural areas. We started conversations with people in Mankosi in April 2012 and it started as a partnership between the University of the Western Cape and Mankosi. We wanted to see if it was feasible for them to run the project by themselves".

Mankosi is a village 60 kms south of Port St Johns in the Eastern Cape, across the river from Coffee Bay. The village is set among rolling hills and rivers with dispersed houses and smallholding plots:" People live mainly on social security payments from Government. There are also others who are migrant laborers who work in the mines or on farms and they send remittances back home. There is not much economic activity beyond spaza shops and shebeens".

Rey-Morena did his PhD using the village as a case study and discovered that 22% of people's incomes was spent on communications:"It goes straight back to the cellcos.

The Government is effectively cross-subsidising the cellcos. It's about the migrant workers and their families wanting to keep in touch. It's mostly voice comms and handset charging. There was no electricity".

So in 2012 they started to engage with the local community:" Initially we went through local guys who spoke English, then went through the Tribal Authority, meeting with the head man. We needed to find out what the community was ready to commit to. We wanted to listen to the community and try and understand if they wanted to do something".

They were quite pragmatic and hard-headed about the money side of things:" We knew that we wouldn't go to internet access straight away. There were issues of sustainability. We asked ourselves, if UWC pays the CAPEX would there be enough OPEX from the community to make it work?" The population of the community is 3,500, 2,000 of whom are over 16 years of age. The village is served by mobile operators but the prices charged are high for such a poor community.

The initial CAPEX for setting up a network in the village was R100,000 (US$7,714), most of which was spent on introducing solar power. At the beginning, there were 10 mesh potatoes (mesh Wi-Fi devices from Village Telco) and there are now 13:" They can now recharge handsets using solar power more cheaply than their competitors. They have re-charged 5-6,000 phones. The phones can be connected using VoIP".

"The next stages of development had four dimensions: technical, financial, legal and social. The latter was about whether the community was going to be able to run the project. Would it be able to collaborate with players outside the community? They needed an external Internet connection and to become an ISP and charge for ICT services. They needed a source of revenue and to become some kind of legal entity".

With some helpful legal advice from Ellipsis Regulatory Solutions, the village decided to set up a not-for-profit telecoms co-operative. It was able to get an exemption from the usual licensing conditions from ICASA. Local people sit on the co-operative board and it gets revenues for charging for its services, which started in September 2014.

It was able to connect to a South African VoIP provider and buy bulk minutes from it so that it could connect to all of the mobile operators. The end result was a retail price that was 50% cheaper than those offered by other operators.

Data services proved a little harder but not impossible to crack. It deployed 12 meter towers between the nearest city (Umtata) with two Wi-Fi long links of 20 kms and 37 kms. It was then able to partner with Walter Sisulu University to get an MOU that provided the bamdwidth as part of their community engagement activity:"They were then able to get from the village to the network, providing the missing link.

However, the connection can only be used for educational purposes so it teamed up with Eastel, a wholesale supplier based in East London, to get bandwidth that could be used for business purposes:"In Umtata, it now has two different gateways, one for business and the other for education and community engagement." So now local calls are free and calls to other networks cost half of what they would on those other networks. Data costs a tenth of the market price.

In a world where GSM operators find it hard to operate profitably at under 3,000 paying customers on a base station, there has to be another way to reach communities in Africa that are both smaller than this number and whose inhabitants are poorer than in the cities.

Community ownership is one route that may help finally bring full connectivity to these communities. Although the price of communications was the main motivation for setting up this co-op, there is much about how it was done that could provide lessons for those elsewhere in Africa.

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