Universal access funding in the broadband and digital technology space falls broadly into four buckets, funding for connectivity, for adoption, for innovation and for inclusion, the latter being cross cutting. The rationale for this is set out in the ITU Financing universal access to digital technologies report. This section discusses what is being funded in each of these areas.
Connectivity programmes and their funding, focus on supply-side strategies that encourage investment in the deployment of last-mile and backbone network infrastructure, essential for network extension and broadband access. At a local level, this includes investment in data centres and local Internet exchange points (IXPs). Such connectivity-based interventions will reduce operational expenditure (opex) and capital expenditure (capex) and increase productivity for businesses, efficiency of public services and access to digital opportunities for all.
Connectivity programmes may include a number of elements (see checklist below). These may include (1) the enabling environment, which is under the control of the regulator and policy-makers, and which give the “green light” for the implementation of projects; (2) connectivity, which requires choosing the right technical solution and can be measured in terms of speed, technology and network elements, (3) non-ICT infrastructure, which is core to any project, electricity and security being two aspects, (4) smart devices, whether shared or personal in more connected areas, and (5), other ICT infrastructure, which is sometimes in the form of applications (apps), platforms, and software. In a school connectivity project for example, other ICT infrastructure could include cybersecurity software, school portals and cloud computing solutions. These are critical to completing the connectivity solution and if locally relevant and easy to use, can also positively influence uptake.
Given the high costs, and potentially high levels of risk, there is a need to think creatively about accountable governance and how to fund sustainable connectivity initiatives that will bring about economic growth and social inclusion. There are two types of funding required to facilitate connectivity. The first is mainly infrastructure related capital expenditure, including:
The second is recurring operational expenses, including:
Adoption programmes aim to increase individual and institutional access through inclusive interventions that encourage adoption and increase usage and affordability. Adoption funding focuses on demand-side interventions, including:
Innovation and investment in research and development (R&D) and SMEs facilitate the development of innovative digital technologies, however, the SME funding gap is significant. It is difficult to raise finance for relatively high-risk, untested, innovative businesses, despite the locally relevant and significant economic contributions that SMEs make. Furthermore, in terms of innovation, new technologies such as drones, Internet of Things (IoT), machine-to-machine (M2M) technologies, artificial intelligence (AI) and augmented and virtual reality (AR/VR) will require funding to make it past the start-up stage and into the mainstream. Given that they too are untested, the availability of financial support to facilitate such innovations may be limited, even though they are likely to be key in fast tracking SDG target attainment.
Digital inclusion funding seeks to ensure that all finance provided (through any programmes) is conditional on inclusivity and the promotion of the participation of women, persons with disabilities, specific needs, older persons, marginalized, and vulnerable persons.