New Networks, New Team Members, Healthy Finances, and Improved Stability

This is a report on the UIXP’s status, progress, and other activities that took place during Q2 2019. We typically only send quarterly updates to the networks which use our infrastructure, but lot has happened in the last three months so we thought it would be prudent to share this one publicly.

27 networks currently exchange 8Gbps of peak daily traffic

New Members
We’re happy to announce that Facebook (AS63293) and Blue Crane Communications (AS328198) are now connected to the UIXP, bringing our total membership to 27 networks. Blue Crane is peering multilaterally via the route servers, but Facebook is not. If you would like to connect to their cache, please send us a message and we will facilitate an introduction. We may also reach out to you directly in order to encourage the same.

Staffing Changes

We’re sad to announce the looming departure of Diarmuid O’Briain as our Technical Operations Manager. Diarmuid has a relentless passion for his craft, and his contributions to the UIXP were both numerous and significant. His legacy will remain, though he will be missed, and we wish him well in all of his future endeavours.

Diarmuid is survived by Brian Masiga and Conrad Ekisa, the newest member of our engineering team. Conrad has a BSc in Telecommunications Engineering and was employed as a Graduate Research Assistant (GRA) at netLabs!UG Research Centre last year. During this time, Conrad qualified as Uganda's first MikroTik Certified consultant and academy trainer. In 2019 he was promoted to Graduate Researcher and led the internship programme for the year. Together with Brian, he will help manage our infrastructure and handle your technical support requests. Please give him a warm welcome!

Diarmuid O'Briain

Conrad Ekisa

Collections

We’re happy to report a substantial increase in the number of paying networks, and that payments have become more consistent overall. However, there are still a few legacy networks which have not joined our sustainability programme despite our best efforts to encourage them, and we will soon start migrating these networks to our free service tier in the interest of fairness.

Cash Reserves

If all goes well, we will have established cash reserves of USD $75,000 by the end of this year thanks, in part, to a generous three year pre-payment by one of our new members. We plan to sustain that amount or more indefinitely.

Salaries
We have started to pay our two IXP Engineers a $100/mo volunteer stipend in order to cover the various expenses associated with their work. These stipends are paid quarterly in order to minimize our administrative overhead. Note that we have not yet implemented remuneration for any other positions in order to prioritize other expenses and the development of cash reserves.

Taxes
We continue to remain in good-standing with URA thanks to support from our tax consultant. In light of his consistently good performance, we have started to pay his fees on a quarterly basis in order to minimize our administrative overhead.

Banking
We still do not have a UGX bank account because opening one would incur an additional monthly charge (in addition to our USD account which costs approximately $12/mo). We currently do few UGX transactions per month beyond URA payments and occasional cash purchases, so it’s cheaper for us to convert USD to UGX when these needs arise. If the volume of UGX transactions increases in the future, we will reconsider our options.

Accounting
We are recording all income and expenses in our accounting system, and we digitally archive all cheques and receipts for auditing purposes. However, we have not been logging URA payments in our accounting system as it’s not a straightforward process. As a result, the account balance in our system does not match the amount in our actual bank account. We are working to figure out the best way to resolve this issue systematically going forward.

Power Infrastructure
Our new inverter system is still working well. We have experienced no related downtime since its deployment, save for a building outage that exceeded the 12 hour runtime of our battery bank.

Air Conditioning
Our air conditioning system has been keeping things cool since we took over its management from the UCC following a series of extended outages. However, there have been a few reliability issues with one of the two new units we purchased which we’re still working with the service provider to resolve. Meanwhile, the new Raspberry Pi temperature monitor is working well and its automated alerts helped us avoid multiple heat related outages during the transition.

Community Engagement
We recently sponsored the Welcome Reception at The African Internet Summit (AIS) that took place in Kampala in June. We were happy to see many of you there and hope you enjoyed it. We also recently joined the ICT Association of Uganda and look forward to supporting their efforts to promote effective government policy.

Government Relations
As many of you are aware, Uganda’s telecommunications industry is facing an increasing number of regulatory challenges, and the UCC’s recent IXP licensing proposal is no exception. It took a significant amount of time and energy to organize the necessary local, regional, and global response to this proposal and we thank all who supported our cause. We will update you if and when we receive any feedback from the UCC.

For background and more information about this issue, please read our company blog post on the matter: http://blog.uixp.co.ug/2019/06/nationalization-in-uganda-looming.html

Governance Reform
We still have not received any feedback on the draft constitution that we proposed to the community in 2015 and again, in updated form, in 2018.

If you are interested in governance reform, please review this draft and submit feedback (or forward it to your legal teams for the same) so that we can move the process forward. A copy of the latest draft proposal and a summary document can be found here: https://uixp.co.ug/documentation/governance-reform-updated-draft-memarts-2018-12

That’s all for now. If anyone has any questions, please don’t hesitate to contact us.

Nationalization in Uganda: A Looming Disaster

The Uganda Communications Commission (UCC) has proposed a new licensing framework that would effectively nationalize a core part of the country's telecommunications industry; Internet exchange points (IXPs).

Introduction to Internet Exchange Points (IXPs)

This news was communicated to us in a letter from the UCC dated June 7th, 2019. The letter included a draft of the licensing framework and a call for written feedback by July 5th, 2019 (click here to download a full copy).

Based on our analysis, the draft framework would establish a government controlled monopoly which all other market players would be subservient to. It would accomplish this with the following formula:

• Establish a “Designated National Internet Exchange Point” that all other IXPs will be required to connect to (9.j);


• Require government approval of contracts between IXPs and network operators (7.4.b);


• Allow the government to arbitrarily compel IXPs to make operational and technical changes (7.5.c)


• Allow the government to inspect, copy, or remove any data related to any IXP without a court order (7.5.b.i);


• Require all licensed network operators to connect to an IXP (8.2.a).

Technically speaking, this policy would merge all IXPs into a single national peering LAN, with each IXP merely acting as a heavily regulated access point for the enlarged infrastructure. The resulting entity would suffer from all of the classic symptoms of a monopoly as well as significant technical challenges and security risks derived from having multiple operators control access points that form part of the same LAN. As a centralized service, it would also inherently lack the resilience that a diverse array of independent IXPs would provide.

Here are two diagrams to help illustrate the concept:

In addition, the draft framework contains language which suggests that the government intends for the "Designated National Internet Exchange Point" to establish itself by expropriating an existing private operation; namely, ours.

This appears to confirm some of our worst fears about Uganda's new National Broadband Policy; a government strategy document, reportedly drafted in isolation, that seemingly calls for a large-scale nationalization and centralization of Uganda's Internet infrastructure under the guise of infrastructure sharing.

We (and others) have repeatedly warned that such policies would have severe socioeconomic consequences for Uganda and the wider East African region. In this particular case, the UCC's planned regulatory intervention in our otherwise healthy industry has no successful parallel anywhere in the world -- and global experts widely regard the other attempts as textbook examples of regulatory failure.

In light of the obvious risks and highly technical nature of this proposal, we feel that this limited survey of the local Internet community is insufficient validation. Accordingly, we strongly urge the UCC to defer any further work on this project until there is a clear rationale and its viability can be transparently proven with case studies and corroborating input from credible global experts.

Meanwhile, we are preparing to submit detailed feedback to the UCC and will post a copy of our submission here once it is ready. We encourage anyone else that would like to submit feedback to do so through us electronically. We will collect, manually submit, and (unless anyone objects) electronically publish all that we receive in order to promote transparency.

Please feel free to contact us here: board@uixp.co.ug

[UPDATE: A copy of our formal feedback to the UCC can be downloaded here. Our general position is that the creation of a de jure IXP monopoly would be bad for our industry, Uganda, and the region. We argue that the regulatory framework should instead seek to create an enabling environment for competition.

We have also uploaded a number of supporting submissions made by the Internet eXchange Federation (IX-F), the African Network Information Centre (AFRINIC), the ICT Association of Uganda (ICTAU), Liquid Telecom, and a personal submission by Diarmuid O'Briain. A copy of those submissions can be downloaded here.]

Annual Update: Sustainability, Stability, and Growth

This is an annual update regarding the UIXP’s progress in 2018 and our ambitions for 2019.

2018 was a surprisingly good year: We overcame substantial challenges, attracted new peers, deployed a prototype Google cache, implemented a new sustainability model, upgraded our failing power system, and paid our legal debts. As a result, we are now significantly better positioned for future growth and, therefore, to deliver significantly more value to our members.

OLD POWER SYSTEM	NEW POWER SYSTEM

In 2019 we plan to build on these successes by lowering prices; developing internal structure; paying key staff; improving service quality; hosting quarterly events; supporting the local technology community; becoming fully tax compliant; and implementing governance reform.

The new pricing structure aims to attract more networks by making peering more affordable: We now offer 10 Mbps ports for free; have cut the cost of 100 Mbps ports by 60%; and have reduced the cost of 1 Gbps ports by 9%. These adjustments were possible to implement without negatively impacting our overall revenue because of growth in our paying membership base, and because many networks have transitioned to (or will soon transition to) more expensive 10 Gbps ports where our existing rates are still cost-effective.

PORT CAPACITY	2018 MRC	2019 MRC
10 Mbps	$100 / mo	FREE
100 Mbps	$250 / mo	$100 / mo
1 Gbps	$550 / mo	$500 / mo
10 Gbps	$1000 / mo	$1000 / mo

We are also excited to announce the impending arrival of a large social media network in Q1 2019. This network will peer directly and should significantly increase the amount of traffic networks generate from our exchange. We are still working out some of the technical details and will share more on this soon.

Finally, we would like to note that none of this would have been possible without the networks that supported the implementation of our sustainability model -- and those that have committed to do so in 2019. To these networks we are extremely grateful. We are heartened by your support.

We also thank everyone else for their participation and look forward to interacting with all of you in the coming year!