For the past several months, a triumphant press release has been sitting on internet provider IDM’s homepage, gathering dust and providing, at the same time, one indication of how the government has been unable to address even small problems that seem to offer such unambiguously large rewards.
“IDM,” the release reads, “Is pleased to announce that on January 3rd, 2006, it has signed with the Ministry of Post & Telecommunications (MPT) a Memorandum of Understanding (MOU) that will allow IDM to offer broadband Internet access over DSL (Digital Subscriber Line). The service will be commercially available once the relevant decrees will be finalized and issued from the Council of Ministers.”
Of course, in retrospect, the first indication that complications might arise should have been the discrepancy between the headline of the press release—“Agreement … allows IDM to offer broadband Internet access over DSL soon in Lebanon” —and the lead paragraph above.
For when one reads on, the indispensable notion of “soon”—critical to those Lebanese who have been hearing about DSL’s imminent arrival for nearly three years now—disappears, apparently unworthy of further elaboration. In fact, any suggestion that “the relevant decrees” themselves might be finalized “soon” essentially boils down to this: DSL will be available once the Council of Ministers decides to act.
Unfortunately, 11 months on, DSL appears no closer to a daily reality than it did before the MOU was signed earlier this year.
This is due to several factors, which are conspiring together to prevent the introduction of what is seen, the world over, as a key driver of economic, intellectual and social progress.
First and foremost, since long-distance calling revenue produces hundreds of millions of dollars each year for the general budget, the government is loathe to introduce broadly available and affordable high-speed internet—the rationale being that people will start to use Voice over Internet technology (VoIP), which is illegal in Lebanon, to place their calls for virtually nothing.
Second, there is a capacity problem: Lebanon’s international fiber links out of the country and onto the commercial internet simply cannot handle a huge increase in domestic users. Long-awaited plans to increase capacity have likewise been subject to delay after delay.
As a result of these issues, internet tariffs in Lebanon remain the highest in the region, with IDM selling a two-megabyte per second upload and download speed package for a whopping $6,000 per month!
Even IDM’s current package, which approximates DSL’s bare minimum 256-kilobyte download speed (upload speeds are capped at a VoIP-killing 32 kilobytes per second), comes in at $150 per month. And that is after sharing bandwidth with other customers in the area and a $300 installation fee.
Although the promised DSL service in Lebanon is meant to provide upload and download speeds in excess of 256 kbps, the expected price of $50 a month still is almost double the average rate globally.
The situation is particularly exasperating since Lebanon’s human capital—its highly-educated and creative workforce—is routinely cited by Lebanese and non-Lebanese analysts alike as arguably the country’s greatest asset, along with its comparatively liberal economic structures.
Modern business, however, is driven by connectivity: without affordable access, Lebanon is increasingly forced to export its precious human capital abroad to better-connected, if less intrinsically liberal, economies. Indeed, even for lower-skilled workers, the lack of a true internet economy means exclusion from emerging opportunities seized on by other countries in the region—call centers, for example, in Tunisia and Morocco that are now serving a wide array of European Union businesses.
The situation reached the point of embarrassment last month when in succession, 1) former pariah state Libya announced a $250 million program with an American non-profit to provide inexpensive laptop computers and satellite internet for all of the nation’s 1.2 million schoolchildren; 2) An international report assessed that internet penetration in Israel reached 71% in 2005, putting the Jewish state in fifth place worldwide; and 3) (just to cap the month off) Iran announced it was making DSL available, but that it would cap upload and download speeds at 128 kbps in an apparent attempt to block usage of politically-oriented streaming video and audio sites.
Thus, the sad fact is that Lebanon is not only being outpaced in the internet economy by both its southern foe and a war-torn, former backwater state with little in the way of human capital, but its own provision of internet services essentially approaches the Iranian model (albeit without the intention to censor).
“Nigeria, Senegal, Libya and Iran announced the DSL entry to their country,” observes Zakiye Karam, commercial manager at IDM. “Who knows, maybe Iraq would do it before Lebanon.”
The suggestion is not entirely implausible. After all, South and Southeast Asian countries have seen a cumulative 57% growth in DSL users over the past year. In the Middle East and Africa, the number of DSL users increased by nearly 1.75 million between July 2005 and July 2006.
Iraq, despite its chaos, has a burgeoning mobile communications sector ideally suited for implementing so-called “leap-frogging” technologies—like wireless Internet—thus avoiding the need to build actual lines on the streets. (Such technologies are also on the rise in Lebanon, with Cedarcom leading the way through its launch of mobile wireless broadband service this month. These high-speed, lower-cost alternatives may even end up trumping the stalled DSL drive — see page 79.)
In any case, Lebanon is seeing little in the way of movement towards a resolution of the DSL issue.
In fact, nine months ago, Minister of Telecommunications Marwan Hamade responded to one reporter’s query on the subject by saying, “The ministry has been paralyzed for years while the main items discussed were conflicts with the mobile companies … Now that we are out of this mess, we can address the issue of broadband.”
Unfortunately, as with the US in Iraq, Hamade’s prognosis that things may finally be clearing up seems, 11 months later, to be worth about as much as promises issued from the suffocating confines of the Green Zone.
It is also perhaps an indication that it will take a lot more than resolving one old issue at the ministry before Lebanon is finally able to move ahead into the Internet economy.