South East Europe Observatory

1
South East Europe Observatory 1st Black Sea and
Caspian Regulatory Conference Istanbul, May
25-27, 2006
Jan H. Guettler Cullen International jan.guettler_at_
cullen-international.com
2
Monitoring of South East Europe -
telecommunications services sector and related
aspects

• A three year project funded by the European
  Commission
• Managed by Cullen International
• Four nine monthly cycles
• Status reports
• Forums (conferences for national authorities)
• First Forum in Brussels, July 18-19, 2005
• Second Forum in Zagreb April 6-7, 2006

3
Participating countries / units

• Albania
• Bosnia Herzegovina
• Bulgaria
• Croatia
• Romania
• Serbia Montenegro
• Montenegro
• Serbia
• Kosovo (as defined by UNSCR 1244 (1999))
• The former Yugoslav Republic of Macedonia
• Turkey

4
Objectives

• Serve the information needs of the European
  Commission
• Provide benchmark information to SEE authorities
  for better informed decisions
• Provide key market and regulatory indicators for
  potential investors

5
Reports available to the public

• First report (August 2005) available at
• website of the European Commission
• website of Cullen International
• www.cullen-international.com under studies
• Second report about to be published (May 22, 2006)

6
PSTN developments

• SEE
• Negative growth, except Croatia and Serbia -
  average -6.7 from 27.6 on Jan.05 to 25.7 on
  Nov. 05
• Fixed telephony is no longer the major source of
  revenue, except Serbia

• EU
• Average negative growth in fixed telephony
  revenues of 1.6 per year
• Fixed telephony remains the major source of
  revenue

7
Mobile penetration

• Average EU growth from 83 to 91 in one year
• Average SEE growth from 49 to 59 in 10 months

8
Broadband penetration in SEE
Greece

• Very low penetration when compared with the EU
• Encouraging growth in some SEE countries

9
Broadband is a major challenge

• Infrastructure for the information society
• Essential for many future economic activities
• Challenge for the EU
• Even stronger challenge for South East Europe

10
ERG report on broadband policies
The market data analysis and the country studies
both lead to the conclusion that the following
hypothesis can explain the market development
both in terms of competition and penetration /
growth of penetration
Regulation leads to competition, which then
incites investment, which in turn pushes
penetration
Broadband market competition report, ERG document
(05/23), May 26, 2005
11
Regulations for broadband?

• Broadband regulations voice telephony
  regulations
• Triple play is a main broadband driver
• Voice / Internet / Television
• Voice delivery requires voice licence
• Voice regulations must support broadband
  investments

12
Questions by potential investors

• Legal environment
• Independent NRA
• Tariff rebalancing
• Market access conditions
• Procedures
• Fees
• Competitive safeguards
• Reference interconnection offer
• Carrier selection and pre-selection
• Number portability
• Availability of wholesale offerings
• LLU, Bitstream, Resale