Counting the Cost of Internet Outages in Lebanon

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October 3, 2022

Internet service interruptions in Lebanon are increasing in frequency and becoming the norm. Access via landlines and mobile data is affected across all regions in the country. The argument used to justify these outages is power cuts at local transmission stations.

At the Internet Society Lebanon Chapter, we estimate that the direct and indirect costs of just one day of such an outage are equal to the cost of supplying transmission stations with the diesel necessary to run generators for six months.

Internet disruptions negatively impact the small and medium enterprises that play a vital role in the Lebanese economy. Based on the Brookings methodology, we have calculated that one day of Internet outage costs the Lebanese economy USD $10 Million. The interruptions mainly affect commerce and digital services, business and multi-national consultancy firms, education, health, tourism, media, and government services. The interruptions are eroding trust in the reliability of Internet services in Lebanon, which in turn, has forced several institutions to move their operations out of the country to maintain the stability and availability of their online services.

These outages are a consequence of an unstable electrical power supply from the public electricity company and the cost of diesel fuel used to power backup generators of Ogero Corporation, the infrastructure provider in Lebanon. Up until 2019, the generators were used as a backup during power outages. However, since the financial collapse in the country, reliance on generators has increased and is the main power source in some regions. In response, companies are reducing the availability of services to limit the costs incurred by supplying generators with the required fuel.

Despite the collapse of the electricity sector in Lebanon, the telecommunications sector remains profitable, generating revenues for the state treasury according to the approved budgets, even before the upsurge in prices that happened in July 2022. We believe there is no justification for withholding diesel and not supplying the transmission stations with fuel in order for them to stay up and running.

Our study, available in Arabic here, shows that the potential saving through service cutting is minuscule when compared to the overall loss to the whole economy. Savings represent less than 3% of the overall operating costs of Ogero.

Disclaimer: Viewpoints expressed in this post are those of the author and may not reflect official Internet Society positions.

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