Private Initiatives and Financing: New Arena and New Players

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Private Initiatives and Financing New Arena and
New Players

• Laina Raveendran Greene
• CEO, GetIT Multimedia (www.getitmm.com)
• CEO, GetIT
• Director, Globetel Communications Corporation
  (www.globetel.net)

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Background

• Telecom policy and business strategy work
  experience
• ITU, Intelsat and Singapore Telecommunications
  from 1986 to 1996
• Consultant GetIT
• telecom consulting with telecom and Internet
  companies, and with agencies such as IDRC, ITU
  and UNDP
• Entrepreneur GetIT Multimedia
• e-learning and KM solutions for high tech
  industry players and blended learning solutions
  e.g. for ITU/ADB for telecom training for Laos,
  Vietnam and Cambodia in 2004

3
Background More recently

• Director of a telecom private initiative
  Globetel Communications Corporation
• VOIP
• Sanswire

4
Stratellite unmanned stationary airship in the
stratosphere, about 13miles high, transmitting
various types of wireless communications
services, each covering about the size of
Texas. EXCITING TO BRIDGE THE DIGITAL DIVIDE
SOONER THAN LATER
Just acquired Hotzone Wireless LLC, an advanced
developer of WIMAX and extended range WIFI
Systems with operations in the United States and
Europe
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Private Initiatives, Financing

• New players such as Globetel are exploring new
  forms of funding
• startup with private equity financing
• OTCBB listing
• bell ringing at Amex on May 31st 2005
• strategic partnerships (e.g. with NASA)
• JV to launch stratellites around the world

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The past

• Telecom a natural monopoly
• High Capex and often low ARPU for political
  reasons
• telegraphy
• Telephony
• Radio communications
• TV broadcasting
• Submarine cables
• satellites

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New Arena

• Telecom not a natural monopoly
• Lower Capex with new technologies
• Cellular
• LEOs, MEOs
• WiLL
• Wi-FI hotspots
• Public Wi-Fi
• Wi-Max
• Ettx
• Stratellites

8
New Players

• Liberalisation and regulatory policies enabling
  new players to emerge.
• Digitisation, convergence and IP also enabling
  new players.
• New players in infrastructure, content, services,
  etc
• Starhub
• Bharti Telecom
• Maxis
• Yahoo, Google
• Cisco, Lucent
• Smaller players
• community kiosks e.g MSSRF village kiosks
• Grameen Phone
• entrepreneurs- ISP Worldlink offering
  connectivity at base station of Mt Everest
• hot spots players e.g. iCell

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Access to Capital is key to success
need US30 billion to US60 billion to develop
telecoms around the world (1999 ITU
report) privatisation of state monopolies in the
last years of the 90s alone in Asia, Europe and
L.A amount to about US200 billion- (1999 ITU
report) New emergence of telecom sector leading
to new and traditional forms of financing
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Traditional sources

• National Treasury
• Traditional debt financing
• Bank loans
• Account receivable financing
• Vendor and supplier financing/credit agencies
• Multilateral funding agencies ADB, World Bank,
  IFC
• Privatisation/equity financing

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Newer forms

• IPOs
• Project financing (BOT (KSO), BTO and BLT)
• MAs and strategic partnerships (Cingular and
  ATT Starbucks plus ISPs)
• Venture Capital
• Public-private funding e.g Singapore
  Technopreneur Fund into traditional VCs, IDA and
  Intel collaboration
• Corporate funds e.g Ericsson has its own venture
  capital subsidiaries, IBM funds through
  traditional VCs

12
Social funding

• Development finance e.g.IDRC (e.g. MSSRF project)
• Microfinance e.g Grameen Bank and Village Phone
  project
• Community financing- self help groups
• social entrepreneurship
• social entrepreneurship VCs and banks
• Universal Service Fund
• Digital Solidarity Fund

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Factors for financing

• Varies from traditional to non-traditional to
  social funding
• Capex
• ARPU
• Balance sheet and profit margins
• Growth potential
• Exit strategies

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Brief concluding remarks

• For telecom regulator
• Transparent and flexible regulatory framework for
  new technology and new players
• For Finance regulator
• Financing friendly environment
• For Industry/commerce policy maker
• Supportive entrepreneurial environment