Economic engineering for improving access to the worldwide telecommunications network

Telecommunications services are not equally available to everyone in the world. This disparity, often called the digital divide, is the topic of much talk, but little progress has been made. Service providers in affluent regions prosper, because they can make a profit. In regions where few people are able to pay market rates, there is little, if any, service without subsidies. However, when subsidies support telecommunications service, the funds are given to existing, typically monopoly, providers, and are often misused. This article defines a concept of how subsidy funds can be directed to consumers. When implemented, this concept provides consumers with the purchasing power needed to buy services; thereby it emulates conditions in an affluent region and attracts entrepreneurs to supply services in response to demand. We believe that this will stimulate profitable business for telecommunications operators to deliver services on an ongoing basis in poor regions. First, however, funds are needed to support the process. They could be supplied by grants from major funding organizations, such as the World Bank and USAID. Long-term sustainability is proposed via contributions from existing telecommunications users through a small tax on their bills. This would ensure continuous support from within the industry with no need to apply for periodic grant renewals. While implementing these techniques is difficult, they employ principles that are already in use. This concept lends itself to a small-scale testing and demonstration, possibly through a pilot project. It fits well into the IEEE Humanitarian Technology Challenge effort by helping establish the telecommunications infrastructure in developing regions.