How can innovations in passive and active infrastructure and energy equipment support the objectives of governments and universal access funds to accelerate the extension of rural connectivity? TowerXchange took a closer look at GIFEC and at what they have achieved working with MER Telecom to connect remote villages in Ghana. We also look at how similar business models, technology and operational solutions could be applied to support similar universal access initiatives.
TowerXchange: Please introduce us to GIFEC and to your work with them to accelerate rural connectivity in Ghana.
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
Ghana Investment Fund for Electronic Communication (GIFEC) is a nonprofit agency of the Ghanaian Government, funded by a levy on mobile network operators revenues, to facilitate the provision of universal access to electronic services to unserved and underserved communities in Ghana.
GIFEC aims to connect isolated villages, typically with 1,000 to 2,000 citizens, that may generate too low ARPU to be profitable for MNOs to connect under their standard business model. To communicate, people in these villages had to walk 10 to 15 km to get sufficient cellular coverage to enable a phone call.
GIFEC issued a tender and MER Telecom’s Light BTS Site concept was chosen based on the following criteria: proven experience in rural projects, coverage capability and low power consumption (150W). We have initially deployed ten Light Sites with renewable energy solutions. Light Site includes a 35m triangular tower, micro BTS, Wi-Fi and VSAT equipment, plus a hybrid energy solution.
TowerXchange: Tell us more about the energy solution designed for these sites.
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
Energy source design is very important at these sites and, as all the villages were off-grid, power supply for the site was sourced from a hybrid energy system that combines a solar array of ten solar panels of 280W each and a set of deep cycle batteries. The challenge was to provide a total solution at minimum capex and opex, by avoiding the need for a diesel generator onsite which would have meant a different and costly business model. Also, a solar-only solution avoids fuel supply and fuel theft problems.
TowerXchange: Talk to us about the active equipment you installed.
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
The challenge in selecting the right active equipment was to balance the need to provide enough capacity and coverage in order to serve the entire village and at the same time, ensure that the BTS had the minimum possible energy consumption (in order not to require a diesel generator on site) and ensure a minimum satellite bandwidth consumption in order to avoid a high opex due to wide bandwidth consumption.
Light Site, had enough capacity and bandwidth to support the needs of the villages around, yet the power consumption and bandwidth required were very low. If we’d used a normal BTS then we would have needed more solar panels, and the site would have become bigger and more expensive
MER Telecom came up with a turnkey solution including active equipment, in this case a micro BTS with 2 TRX capacity (expandable on demand). This was much cheaper and more efficient than a standard BTS. The solution we delivered, which we call Light Site, had enough capacity and bandwidth to support the needs of the villages around, yet the power consumption and bandwidth required were very low. If we’d used a normal BTS then we would have needed more solar panels, and the site would have become bigger and more expensive.
Based on a specification from GIFEC, the equipment was purchased from a variety of different suppliers, with MER Telecom as the integrator. MER Telecom produce the passive equipment. Since we do not manufacture active equipment, we selected the right suppliers in order to meet the client’s specs and requirements.
TowerXchange: Under what business model are these sites going to be brought to market? Is it a revenue share?
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
It’s not a revenue share model in this case.
GIFEC has purchased the turnkey sites. When the site build will be completed, they will be available to connect to different operators. In this case I believe GIFEC is working with Vodafone Ghana, but it could be other operators as well or even become a multiple operators site. Either way, GIFEC remains the owner of the site.
TowerXchange: Could the business model be extended to have multiple tenants sharing the sites?
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
We can install the antennas of several different operators on these towers, but in a village that might have 500 users, hosting three tenants would make the site much more expensive in terms of additional capacity and energy, so GIFEC have deployed different sites with different operators. GIFEC would evaluate whether there was a case to deploy more capex to add additional solar panels or batteries and support additional tenants. The loading starts very low with just one tenant using standard size antennas and small microwave dishes - every site can be upgraded.
It is important to mention that there is no technical limitation in creating a multi-tenant site. The only limitation is the business aspect. If the village is large enough, a multi-tenant site can be a viable solution.
TowerXchange: How does the capex and opex of a Light Site compare to normal cell sites?
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
With Light Sites, maintenance costs are a few hundred dollars per month - probably 10-20% of the opex of a regular site which might require US$2,000-2,500 per month and even more when considering the difficulties of maintaining rural sites separated by large distances.
I can’t be too specific about the capex because we’re under NDA, but the BTS and passive infrastructure costs less than half of the cost of a regular site.
TowerXchange: Tell us about the energy footprint of the Light Site solution
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
Light Site consumes 150-200W in total, compared to a regular BTS which might require 1,500W. This is the reason why a diesel generator is not needed with Light Site.
Each Light Site can be tailored to local power requirements by varying the size of the PV array according to hours of available sunlight, with a battery bank of a different size according to the number of hours of autonomy required.
The hybrid systems are monitored by MER Telecom’s own smart controller which monitors and activates the solar and battery energy sources according to the availability of each. We selected a deep cycle battery with a lifetime longer than standard batteries to reduce battery related maintenance costs.
TowerXchange: Talk to us about the merits of VSAT in rural areas.
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
We chose the VSAT connectivity solution due to its cost effectiveness in rural areas where there is no line of sight to any existing cellular operator. The VSAT requires very low bandwidth and as such reduces each site’s monthly opex.
TowerXchange: What is the appetite for other Universal Access Funds to engage in similar projects?
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
We are seeking to promote and duplicate this model beyond Ghana with other organisations with the same objective as GIFEC in order to develop and facilitate digital access.
Universal Access Funds exist to close the digital divide, and building cell sites in remote villages shows the population that they are acting on their behalf to extend communications to the underserved.
In the past many Universal Access Funds have been focused more on fibre optic connectivity in urban areas, however now their attention is focused more and more on rural areas hence projects like GIFEC’s are becoming more viable and common.
TowerXchange: Who is the “client” when seeking opportunities on similar projects?
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
The client in most cases is the Universal Access Funds which are administered by Ministry of Telecommunication and/or the regulator.
TowerXchange: Are there other use cases for Light Site?
Arie Ben-Dayan, Marketing & Sales Director, MER Telecom:
Yes, we are definitely targeting also the MNOs which are aiming to provide coverage and services access to the rural population at minimum cost. Light Site is used by MNOs as well as Universal Access Funds, which in some cases are driven by license obligations to extend coverage. Towercos have also expressed their interest in our Light Site solution, although it’s a challenge to make the energy solution viable from a capex and opex point of view when capacity for two to three tenants per site is needed.
how can an urban migrant send money home if there are no connections in the rural village where his family lives?
Mobile Network Operators are offering an increasing number of VAS platforms that bridge urban and rural areas, such as mobile education and mobile money. How can an urban migrant send money home if there are no connections in the rural village where his family lives? ARPU from voice services is not enough to make many rural network extensions viable, so it is imperative to develop additional value added services like mobile money, which in turn drive the need to cover the maximum population - it’s a cycle. Innovative solutions like Light Site can transform the economics of rural network extensions that otherwise might be loss-making.
It’s time to reconsider the deployment of full size cell sites in rural areas. For example hundreds of the regular cell sites deployed in rural Congo have been switched off because of the monthly maintenance cost which is higher than the monthly revenue generated. Using a small, lightweight site which incurs minimum capex and opex might offer lower capcity and bandwidth, but at least there is available service.
MER Telecom will be hosting a round table at the TowerXchange Meetup on “How to make rural communications commercially viable”. For more information, click here
