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Wednesday, 8 September 2021

How fiber optic cables are forming the bedrock of our digital infrastructure overhaul

PROJECT PROFILE- Waiting for our high speed internet dreams to quit buffering: Since 2012 the government has set out on a major overhaul of our ailing digital infrastructure by replacing our traditional copper based internet cables with a more exhaustive high-speed fiber optic network. Telecom Egypt has been at the helm of this initiative to upgrade our current digital landscape, which has included expansions to our rural regions. In this issue we take a look at what Telecom Egypt has been up to on this front and why, despite almost completing the rollout of this plan, internet speeds remain stubbornly slow in Egypt.

So, why are we swapping out our copper network for fiber optic cables? Data travels over fiber optic cables at 20 times the speed regular copper can transmit, reaching up to 1 gbps up from the average 50 to 100 mbps speeds copper can offer, according to HP. The reason fiber optic is so much faster, and more reliable, than our traditional network is because copper wire heats up and picks up interference as it transmits internet signals. Fiber on the other hand breaks down files into data packets that are transmitted in beams of light over thin glass or plastic fibers contained within a protective encasing known as cladding. This also makes fiber less susceptible to internet service provider-induced slow downs during peak use.

The 2012 EGP 37 bn transition plan to connect c.34 mn homes was off to a slow start when it first launched but has recently picked up the pace. Telecom Egypt figures show that the company had transitioned some 9.7 mn households to fiber optic cables in 2016 and 12.6 mn households in 2017 before jumping considerably to 17.6 mn in 2018, and 27.7 mn in 2019, according to Telecom Egypt’s IR director Sarah Shabayek. By 2020 the total number of homes receiving internet service through TE’s fiber optic network went up by another 3 mn households, despite covid-related delays, which came to a total 30.8 mn by the end of the year.

Where does the project stand today: The company had completed 90% of its fiber optic connectivity target, which translated to 30.8 mn households being hooked up to the new network, Shabayek told Enterprise. “Telecom Egypt has basically finished working on the project. We covered about 90% of the target areas designated for a copper to fiber transition.The outstanding portion isn’t economically feasible to complete because of their remote location and low population density." By our own in-house calculations that amounts to some 4.22 mn homes waiting to be plugged into the fiber network.

One source of funding for the remaining homes could be the NTRA’s Universal Service Fund — which draws its revenues from a government-mandated fee on private sector companies operating in Egypt — could become another source of financing for a portion of the remaining households, according to Shabayek. The rest will come out of the state’s budget.

A separate initiative is in the works to bring 65 mn people fiber optic broadband: The government’s rural infrastructure development plan, Hayah Karima, will spend EGP 5.6 bn on installing fiber optic networks to some 1 mn residential buildings and 14k government buildings in 1.4k villages around the country, according to a CIT Ministry statement. Up to 65 mn people in rural regions are expected to see fiber optic powered broadband under the same Hayah Karima initiative, Ihab Said, head of the communications division of the Federation of Chambers of Commerce (FEDCOC), tells Al Dostor.

But results from Ookla’s Speedtest still show falling internet speeds this month: Average fixed internet speeds in Egypt fell to 41.45 Mbit/s in July, down from a reading of 42.42 Mbit/s in June, according to AMAY. Our global ranking of internet speed by Ookla also fell by one position in July putting us at the 92nd position globally, compared to 91st in June, when average speeds surpassed the 40 Mbit /s global average.

Egypt did however inch up to become the country with the third fastest average internet speed on the continent in June. The CIT Ministry said in 2019 it was targeting speeds of 40 mbps by the end of 2020, which at the time was still hovering at an average download speed of about 31.38 mbps.

So, why are we still falling short? It takes more than just fiber optic cables: It comes down to the wiring of existing buildings, which are outdated, Shabayek explains. “Electrical wires and internet cables need to be separated into different plastic tubes to avoid electrical interference with internet speeds,” which dampen the gains from our fiber optic network, Shabayek added.

Then there’s the old router problem: Routers have a lifespan of about five years and need to be swapped out every so often to keep up with the newest advancements in internet technology. Telecom Egypt was one company that shouldered a sizable portion of the costs of replacing old routers and launched an awareness campaign urging people to swap out their devices, Shabayek said.

The solution? Make all new buildings fiber optic-friendly: Fiber optic connectivity in April became a requirement for locking down licenses to build new properties much like all other required public utilities. The requirement has yet to be explicitly spelled out in the government’s new Unified Building Code but the new code is expected to be expansive and should see the light in the near future, suggesting that CIT infrastructure requirements could be included in the new regulations.

Beefing up our internet instructure has never been more crucial: Since the covid-19 pandemic hit and forced many crucial aspects of daily life to move online, demand for high speed internet access has skyrocketed here in Egypt. With Interest in online education, digital healthcare and e-commerce increasingly becoming part of the new norm established by the onset of the pandemic, an overhaul of our ailing internet infrastructure and wider access to our often forgotten rural regions is long overdue.

The challenge ahead remains bringing existing buildings to the fold to ensure that the heavy investment in upgrades are not for naught.

Your top infrastructure stories for the week:

  • Hassan Allam Construction and Hassan Allam Roads and Bridges have been asked by the Transport Ministry to build stations and several bridges for the government's multi-bn high-speed rail network, the company said in a statement.
  • Port Said could get a new EGP 3 bn logistics zone, with Head of the Internal Trade Development Authority (ITDA) Ibrahim Ashmawy and Port Said Governor Adel El Ghadban floating the idea in a meeting yesterday.
  • French CMA CGM will operate and manage the Tahya Misr all-purpose terminal in the Alexandria port, after signing an agreement with the government.
  • The Finance Ministry will guarantee an EGP 36.2 bn loan from the CBE for the National Authority for Tunnels, to finance planned projects during its current fiscal year, sources told Al Borsa (pdf).

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