During the heydays of the Internet bubble, "bridging the digital divide" became something of a buzz phrase that triggered substantial funding effort in international development circles. Distance education (DE) was deemed the most cost-effective and cost-efficient way to improve poor countries' capacity building and development efforts. Using Grounded Theory methodology, this study analyzes the performance of three major foreign aid-funded projects: the African Virtual University (AVU), the Formation Ouverte et à distance (FOAD) and the Université numérique francophone mondiale (UNFM).  This study set out to explore whether these foreign aid-funded DE projects comply with principles of Instructional Design (ID) and Results-Based Management (RBM) and if they have the potential to live up to their promise of cost-effectiveness, cost-efficiency and economy of scale. Thirty-two in-depth interviews and non participant observations were conducted in the field in two higher education institutions in Mali and in Burkina Faso, the content recipients, and in one Canadian HE institution, the content provider.  Findings suggest that the performance of these projects suffered from the lack of Needs Analysis. It follows that current DE projects in SSA may not be sustainable. It is argued that an ecological (Bronfenbrenner) and systems (Banathy) approach of project design and management will help to improve the effectiveness of development projects in general in developing countries and DE projects in particular both in developed and in developing countries.