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ArabCom 2004

Alan Horne MD InterConnect Communications Chairman, Eurostrategies. ArabCom 2004. Objective. To introduce an option in developing effective competition in the Telecommunications Sector whilst meeting Regulatory requirements of Transparency, Account Separation and Non Discrimination.

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ArabCom 2004

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  1. Alan Horne MD InterConnect Communications Chairman, Eurostrategies ArabCom 2004

  2. Objective • To introduce an option in developing effective competition in the Telecommunications Sector whilst meeting Regulatory requirements of Transparency, Account Separation and Non Discrimination

  3. Characteristics of Market in Region • Low fixed line tele density • Higher mobile tele density for significant room for growth • Young or non existent competition • Young or non existent regulator • State owned fixed operator • Mobile operator as a subsidiary of fixed • Significant potential for growth • Opportunity to leapfrog more developed markets

  4. EU Average 81% There is significant room for growth in fixed and mobile

  5. Future Government Policy Maker < 50% Ownership Regulator Policy Law Decrees Individual Services Licence Class Licences Interconnection Regulation Retail tariff Regulations Number Management Frequency Management NeCo NeCo Competition Regulations Interconnection Clearing House ISPs Operator 1 Voice, Data Fixed & Mobile Operator 2 Voice, Data Fixed & Mobile Operator n Voice, Data Fixed & Mobile ISPs ISPs Hosts ISPs ISPs ISPs TV Equip Suppliers Radio ISPs ISPs ISPs ISPs ISPs Number Portability Clearing House Mobile, fixed wire, fixed wireless, WiFi, cable, broadcast customers

  6. Future • Class Licences for most types of operations which do not need to be applied for; • Particular licences only for infrastructure development; • Three of four national infrastructure providers, each competing on relatively equal terms; • Operators able to sell any type of service and use any type of technology; • Other service providers offering indirect access; • Customer able to change service provider and keeping number; • Voice and data services and prices cost orientated; • Universal service fund set up to support service provision to uneconomic areas;

  7. Criteria for Success Licensed Operator Mobile Operator Retail Services Fixed Line Services Mobile Services ISP Services Leased Services Fixed Line Operator Account Separation Non discrimination Transparency Carrier Services Department Operating Network Data Operator ISP

  8. Strong Regulation in definitive areas • Regulator controls: • Numbers; • Spectrum; • Regulator sets regulations for: • All wholesale prices of operators with SMP in such services; • Basic retails prices for operators with SMP (e.g voice, internet access, leased lines) • Creation of Fair Competition is essential to success.

  9. Key Responsibilities of Regulator • Encourage competition; • Issue licenses and enforce compliance; • Establish rules of interconnection; • Create and administer the numbering system; • Supervise tariffs of Providers with Significant Market Power; • Resolve complaints from consumers; • Act as a mediator and arbitral body to resolve disputes between licensees; • Ensure any anti-competitive behavior is stopped; • Assist educational, health care institutions and disabled; • Facilitate the access of disabled persons to Telecommunications Services;

  10. Economic and financial model • An economic and financial model of the industry is required in order to assist in making sound Regulatory decisions. • The model should take account of: • Affordability and demand (GDP, income per household, income per person, spend on telecommunications); • Number of mobile operators; • Number of fixed operators; • Market share; • Cost of provision of service; • Profit and return on investment by operators; • Income to Exchequer; • Costs to customers; • Income to operators.

  11. Resulting benefits to all stakeholders • Consumer • Choice of supplier; Lower prices; Improved services; Easier access to new systems and services. • Government • Increased value of assets; Increased volume of usage; Increased direct fees from sector; Increased indirect fees from improved business performance • Operators • Improved economy of scope and scale; Regulated interconnection and wholesale prices. • ISPs and Value Added Resellers • Ease of market entry; Wholesale interconnection prices

  12. Conclusion • Delays in implementing reform in Telecommunications cost a country $Bs of per year in lost investment • Ministries, Regulators and Operators need to work together and keep an open mind • Consultation Processes are essential • Regulator must be able to offer competitive salaries to keep the best people • Policies need to be set which enables rapid growth of competitive market • Creating technology neutral licences and enabling fixed and mobile services to be offered by same company enables economies of scope and scale • Appropriate Regulation and structural changes within the operators are required to assure fair competition

  13. Creative and positive attitude by Regulators and Operators will result in benefit to all stakeholders – simply put the cake will get bigger

  14. InterConnect InterConnect Communications Merlin House Station Rd NP16 5PB UK Tel: +44 1291 638 400 www.icc-uk.com www.eurostrategies.com

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