Plan of (in)action

Lebanon is reporting little progress in implementing a new vision for telecoms

If a five-year plan to modernize Lebanon’s telecommunications infrastructure announced in July is being implemented, the Ministry of Telecommunications (MoT) isn’t talking about it. There’s no progress report on the website. The MoT hasn’t publicly announced tenders for the various projects needed for an upgrade. And the ministry’s reply to repeated interview requests on the subject? Silence.

After launching the plan, the MoT did try to tender new management contracts for the two state-owned mobile phone networks. The first try flopped. Bids for the three-year contract were due at the end of July 2015 with the announcement expected in October. Egypt’s Orascom Telecom Media and Technology Holding – which currently manages the network branded as Alfa – allegedly submitted its bid one hour late. Telecom Minister Boutros Harb disqualified the company. With that action, there were only two remaining bidders, and the tender was postponed. New bids were due in September, but the MoT has made no announcement about participation. A declaration of winners of the new management contracts is slated for December 2015.

The five-year plan, of course, included much more than new management contracts for the mobile phone networks. Indeed, the presentation delivered in an ornate hall in the Grand Serail was full of promises that – by 2020 – Lebanon’s notoriously slow internet speeds would be a thing of the past. The centerpiece of the plan focuses on replacing Lebanon’s current internet infrastructure – which today consists mostly of copper wires – with fiber optic cables. Fiber can handle more data traffic than copper and can deliver faster up- and download speeds, especially over long distances. At a short distance, copper wires can be used for fast downloading. In an interview several years ago, Toufic Chebaro – the chief ICT officer with Ogero, the state-owned telecom company that has a monopoly on internet access – told Executive that in Solidere, where buildings are connected to the national backbone by fiber and internet speeds are the fastest in the nation, internal building wiring is still done with copper. While Executive does not have exact figures, chief executive officers of local internet service providers have explained that in many locations, users are connected to the national backbone by several kilometers of copper wire, meaning download speeds are reminiscent of the 1990s, not the digital age.

The best-laid plans…

During the five-year plan presentation, the ministry confirmed that Lebanon has a fiber optic backbone that is not being fully utilized (some heavy users are connected but it was still not carrying traffic between the hundreds of “centrale” offices around the country that link users to the backbone, which is the cable’s primary purpose). Minister Harb promised the backbone would soom be fully put to use and that by 2020 fiber would replace copper in connecting users to the backbone. Such an undertaking – known as fiber to the home – is both expensive and labor intensive. The plan is to unfold in stages by using what are known as active cabinets during an interim stage. For users several kilometers from a centrale, cabinets would be connected to the centrale by fiber and placed closer to end users who would connect to the cabinet by copper but enjoy faster speeds because of the reduction in distance. To date, no new infrastructure works have been announced.

Early in his term as minister – which began in February 2014 – Harb said in an interview with Executive that he also planned to fully implement a 2002 telecom law that called for privatizing the mobile phone networks and Ogero. The company controls access to the international internet gateways (in the form of subsea cables) that connect Lebanon to the rest of the world. Private internet service providers lease bandwidth from Ogero and then resell that bandwidth to consumers. They’ve long complained that Ogero does not provide enough bandwidth. The 2002 telecom law calls for ending Ogero’s monopoly on access and privatizing the enterprise. Again, however, Harb made no public announcements in the first 11 months of 2015 to reach this goal.

Upgrading Lebanon’s internet infrastructure is key for the country to become the technology hub several policy makers insist they want it to be. The first thing tech-savvy entrepreneurs complain about is the poor state of internet infrastructure. And they are not the only ones who stand to benefit. In 2009, the World Bank found that for every 10 percent increase in high-speed internet penetration, a country’s economy gets a recurring 1.3 percent growth boost. Harb’s plan looked great, but Lebanon has a tradition of writing up excellent roadmaps and then never leaving the couch.

Matt Nash

Matt is Executive's Economics & Policy Editor. He has been reporting on Lebanon since 2007 with a focus on oil and gas, policy and legal matters.

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