FILE The market of telecoms. Developement of the market of telephony : An extraordinary jump in the future page 2

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1 Quarterly Report of the Post & Telecommunications Regulatory Authority N & September Editorial Three principal topics make the essence of this number: the Wimax, the local loop unbundling and the universal service of telecommunications. They, indeed, make the topicality of the regulator. With the objection of the apparent eclecticism of such a synopsis, we can undoubtedly oppose the intimate dialectical bond which links them because the questions which they raise constitute in the whole if we well think of it, the characters of an eternal piece played between the market and the obligations of the public utility. The regulator has in this piece the harassing but impassioning role which is to permanently adjust the account which makes the basic outlines and which is summarized in what follows: If it is important to encourage and to call for the deepening of the market opening up, it is important to ensure the monitoring allowing the safeguarding of general interests which is not naturally the concern of the private initiative. The widening of the market opening up implies that the services range likely to be offered by the operators can unceasingly increase. WiMAX which allows to provide a high flow Internet connection by covering several kilometres of ray and of which one of the possible uses consists in covering the zone known as of the " last kilometre ", also called radio local loop, i.e. to provide an access to high flow Internet in the non covered zones by traditional telegraphic technologies (ADSL lines such as ADSL, Cabled or specialized lines T1, etc.), causes even the interest of numbers of operators already installed following the example of those holding a licence and VoIP operators under the authorization regime. The regulator being well up on these requests had registered them among the number of its urgent tasks and delivered in this respect the suitable authorizations and frequencies. This technology will allow operators other than those of fixed telephony to offer high flow data transmission service by exploiting the radio frequencies. FILE The market of telecoms. Developement of the market of telephony : An extraordinary jump in the future page It is the same for the radio local loop unbundling which will allow to other operators than those of fixed telephony still having today the legal exclusiveness, to be able to exploit in the radio high frequencies the telecommunications service data. The necessary regulatory initiatives have in this respect to be quickly taken. The market has thus its requirements to which it is important to answer as well as possible and as fast as possible, but it also has limits that the legislator imperatively indicated in the establishment of rules allowing to ensure equity in telecommunications that the market would not witness their implementation. These requirements for equity are brought out by the universal service whose actors, mode of financing and the minimal contents are defined by the legal texts. The ARPT examines for the moment the schedule of conditions of the universal service of telecommunications. This schedule of conditions will have to describe the charges plan and the obligations of the operators who will have to ensure the universal service. We well see thus through the halt which constitutes this number of the quarterly report of the ARPT that it is concerned by the concerns of all the regulators who deepen the market opening up to reach the consumer s best interests. Mr. Mohamed Belfodil President of the council Summary Page 1 : Editorial Page : The Market of Telecoms - Development of the market of telephony : An extraordinary jump in the future - Evolution of the financial aggregates of the mobile telephony / -The ISPs in Algeria -VoIP: A difficult starting of the operators - The market of telephony in the MENA area Page 1 : The Market of Post - The International accelerated Mail Page 17: Reflexion - The unbundling of the local loop - Wimax - The band of, GHZ in Algeria - Triple Play or Television via ADSL - The spectrum : a scarce ressource Page : Regulation - The ARPT approves the reference interconnection offers of the telephony operators for the /7 year - The tarif of the call termination drops, that of details stagnates - Decisions of the Regulatory Autority of Post and Telecommuncations - Universal service of Telecommuncation: Algerian strategy Page 8 : Events - The UIT celebrates the centenary of the Radio communcation s Regulations - News of the Authority

2 The Market of telecoms Development of the market of telephony: An extraordinary jump in the future All the observers agree on the fact that the market of telephony has made an extraordinary jump in the telecommunications sector in Algeria these last years. Indeed, we estimate that, the subscribers number will reach, million including, million for the mobile beside, million for the fixed telephony at the end of the year. Evolution of fixed and mobile telephony densities, and total The total penetration (fixed and mobile) expected will be about 71% what joined the rates that we have the practice to see in the developed countries. 8% 7% % Fixed Penetration Mobile Penetration Total Penetration 71,%,% % 9,% % 1,% % % 1% %,1%,8%,%,% 7,%,1%,1%,% 1,% 11,%,9%,7% 1 Estimate dec With a mobile density which will have to reach % at the end of the year, Algeria can from now on consider itself among the emergent countries which are the most favoured in term of accessibility and availability of this mean of communication for all the categories of the society. However it will be necessary to underline a,9% 7,% 1,% Evolution of telephony between and in Algeria 7,8% 9,% light flat on the side of the fixed density which does not see a take-off this year, because with a rate of penetration of 9,% expected at the end of the year, we will understand that it still remains much things to do. This means that, the existence of two operators on the market competing on the traditional telephony networks in addition to the seven operational operators of VoIP, will have to support soon, the increase of the fixed subscribers number, more especially as Internet technology by ADSL uses the ordinary fixed line is called to be generalized in Algeria. Subscribers to fixed Networks 7% Subscribes by Millions 1 1 Subscribers to mobile networks Fixe penetration Mobile Penetration 1,% 1,% 1,7,%, % % % % % Teledensity 1,8,8%,1%,1%,% 1,9,%, 1,%,,9% 7,%,7%,1 1, 1 Estimate dec,,9 7,8%,, 9,% 1% % Quarterly Report of the Poste & Telecommunications Regulatory Authority N & - September

3 The Market of telecoms Mobile telephony, a sustained growth, Sep. Sep. The market of mobile telecommunications saw its volume doubling in one business year passing from 11,7 million subscribers in September to 19, million subscribers in September, which caused a significant increase in the mobile telephone density which passed from,9% to 8,7% over the same period. Subscribers to the mobile networks Million Evolution of the subscribers to the mobile networks and penetration 7,% 8,7%,% Mobile total subscribers,% Mobile density,% 19, 18,9,7% 18,7 7,88% 17,9,% 17,1,9% 1, 1,% 1,7 9,% 1,1 1 7,1% 1, 1,,9% 1,9 1, 11,7 1 % % % % % 1% % Mobile penetration sep.- oct.- nov.- dec.- jan.- feb.- mar- apr.- may- jun.- jul.- aug.- sep.- With an average monthly growth of,%, the subscribers number has increased by 8,17 million in only one business year. The majority of the new acquisitions during this period were to the profit of OTA (7%), against 9% for ATM and 1% for WTA. Thus, OTA remains the dominant operator on the market with a subscribers number which relatively doubled by passing from,1 million subscribers to 1 million, followed-up by ATM which saw its subscribers number increasing from,7 million to,88 million and finally WTA of which the subscribers number passed from 1,17 million to, million Evolution of the subscribers' number to the mobile telephony operators between Sep and Sep 1 Subscribers to the mobile networks 1 8 8,1 7,98 7,7 7, 7,8 7,,,1,11,1,71,,91,,1,7 1, 1,78 1, 1,8 1,8 1, 1, 1,17 9,8 9,99 1,1 9,8 9,8,7,88,,,,1,,,11 1,88 ATM OTA WTA sep.- oct.- nov.- dec.- janv.- feb.- mar- apr.- may- jun.- jul.- aug.- sep.- Quarterly Report of the Poste & Telecommunications Regulatory Authority N & - September

4 The Market of telecoms Share of market, a speaking indicator! Over the period between September and September, OTA holds the most significant share of market, nevertheless, this one has recorded a light fall (,8%) by passing from,9% to,1%, with a minimum of,% reached in March. % % % %,9% The fall noted by OTA was done to the profit of these two competitors ATM and WTA; Indeed ATM saw its share gone to increase by,% by passing from,7% to,77% over the period, leading to register a maximum of 8,81% in March. Pertaining to WTA, the last entering on the Evolution of the mobile telephony shares of market,1%,1%,7%,7% 1,8%,%,8% mobile telephony market, it has gained 1,% of share of market over the period by passing from 1,7% to 1,%, and by having also registered a minimum of 1,% during February and January.,7%,8%,91%,8%,1% % %,7%,9%,7%,9% 7,1% 8,7% 8,81% 7,1%,%,88%,7%,%,77% ATM % OTA % WTA % 1% 1% 1,7% 1,9% 11,% 1,81% 1,% 1,% 1,% 1,7% 1,9% 11,9% 11,% 11,7% 1,% % % sep.- oct.- nov.- dec.- janv.- feb.- mar- apr.- may- jun.- jul.- aug.- sep.- A mobile market dominated by the prepaid Whereas the economic model is based on the subscription (post-paid) in the other countries, the Algerian consumer singularizes himself by the choice of the prepaid. On the totality of the subscribers to the mobile telephony networks, 97,% are in the prepaid against,7% in the post-paid. This did not put off to the operators at all who see there an effective mean to increase their treasuries, more especially as the subscribers have to reload each month on average, to be able to call on the network. Evolution of the subscribers according to their profile 18 Prepaid Postpaid 1,7 17, 18, 18, 18,71 Subscribers number (millions) , 11, 1, 1, 1,1 1, 1,9 1,7,,,,,,,,7,9,1,,, sep.- oct.- nov.- dec.- janv.- feb.- mar- apr.- may- jun.- jul.- aug.- sep.- Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

5 The Market of telecoms Year : Zoom on the principal figures of the mobile telephony market The park of the subscribers The year saw an increase of 1% in the subscribers number, more than,8 million subscribers have come to join the community of the mobile subscribers during the first three quarters of. Incomes generated by the mobile activity Mobile telephony is generating significant incomes for the mobile telephony operators; indeed, they increase unceasingly during the quarters with the increase of the park of subscribers and the services offered in margin of mobile telephony (SMS, MMS, WAP, GPRS, etc...). The incomes of the three operators for the third quarter of are estimated at 1,8 billion DA, of which the major part (7%) is allocated to the operator OTA. Subscribers number per operator ATM OTA WTA total of the subscribers in the mobile telephony networks Incomes of the present quarter (thousands DA) ATM OTA WTA total quarterly Revenue generated by mobile telephony The cells in yellow are estimated figures 1 st quarter nd quarter rd quarter Source: Operator 1 st quarter nd quarter rd quarter Source: Operator The cumulated in comes The cumulated total income of mobile telephony for the third quarter is estimated at 11 billion DA of which 7 % returns to OTA Incomes cumulated at the end of the quarter (thousands DA ) ATM OTA 1 st quarter nd quarter rd quarter WTA The total Cumulated in comes generated by mobile telephony The cells in yellow are estimated figures Source: Operator The ARPU generated by the mobile telephony ARPU (DA) 1st quarter nd quarter rd quarter Concerning the ARPU, the average of the mobile telephony ARPU at the end of September is estimated at 7 DA by subscriber. OTA registers the strongest rate by subscriber (17 DA of income by subscriber). ATM OTA WTA ARPU of the mobile telephony ARPU : Average revenue per user The cells in yellow are estimated figures Source: Operator The MOU of mobile telephony Each subscriber connected to one of the various mobile networks consumes on average 1 minutes 1 h min per month. ATM OTA MoU / Mn 1st quarter nd quarter rd quarter WTA MOU of the mobile telephony segment MoU : minute of usage Source: Operator The cells in yellow are estimated figures Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

6 The Market of telecoms Evolution of the financial aggregates of the mobile telephony operators / The three mobile telephony operators operating on the Algerian market have carried out a consolidated sales turnover which exceeds 119 billion dinars, during the business year, against 77 billion dinars recorded in, that is, a progression of %. It is OTA, the second GSM operator in the country, which has recorded the greatest part of the total sales turnover with 8 billion dinars. OTA is followed by the incumbent operator ATM who has realized more than billion dinars. The third operator Nedjma, has recorded 1 billion dinars. In addition, the consolidated EBIT obtained by the three operators, has passed from billion dinars in to billion dinars, which gives a fall of %. The net income of the business year, has known a very significant rise, passing from 1 billion dinars of benefit in to billion dinars in, which represents a growth of 1%. OTA arrives at the head as regards the distribution of the results, followed-up respectively by ATM and WTA. In the chapter of the investments, the amount cumulated for the three operators till the end of the business year, is about billion dinars, against 11 billion dinars till the end of, that is, an increase of %. This evolution confirms, thus, the financial efforts authorized by these operators, whose principal objective is to develop and extend their services, as well as the improvement of the service quality. Evolution of the income statements Billion DA Sales turnovers EBIT (earnings before interest and taxes) Net income for the year Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

7 The Market of telecoms Always conceirning the year, the credits of the mobile telephony operators rose to billion dinars, against 1 billion dinars entered during, which gives an evolution of 1%. As for the consolidated amount of the availabilities, it passed from 1 billion dinars in to 11 billion dinars in, which gives an evolution of 1%. Evolution of asset account 11 Billion DA Investments Credits Availabilities On their side, the consolidated stock holders equity, knew also in a progression of 18% compared to their level reached in, by passing from 7 billion dinars to 7 billion dinars. Lastly, the debts cumulated for the three operators, passed from 1 billion dinars in to 19 billion at the end of the financial year, which represents a rate of variation of (+%). Evolution of the liability account Billion DA Stock holders equity Debts Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 7

8 The Market of telecoms ISP in Algeria Today, on 9 operating ISP on the national territory, about 1 among them declare really an activity according to their reports of the 1 st quarter of. For the first time that the ARPT inquires on this market segment, the data collected enable us to have an image on the situation of this activity segment. 1 - Employment and sales turnover of the ISP As regards employment, the market of the Internet access suppliers employs 9 person of which the thirds are CGD (contract at given duration), the growth of employment over this quarter is estimated at 8% compared to the previous year. The sales turnover realized by this market segment is about 1,1 million dinars for fourteen Internet access suppliers during the 1 st quarter of, divided into majority between the two greatest operators of the market, Djaweb and EEPAD. Indeed; Djaweb carried out million dinars and EEPAD 191 million dinars, it represents respectively % and % of the total sales turnover, and the remaining rate is divided between the other operators. As regards investment for this first quarter of,,8 million DA was carried out, 1 million were carried out by SLC. Operators BMGI CASTELUM NET EEPAD FORCE NET I.ALGERIE ICOSNET PROCOM INTERNATIONAL SAAD NET SAT LINKER SERI SLC TDA VOCALONE WEBCOM DJAWEB CACI IKOM NETWORK IPAT MOBI LINK WEBPHONE NETWORK TOTAL Sales turnover (millions DA) 7,1, 191,,, 18, 1,8 Not available,,,,9 1,71 1,, Non operational Cancellation of the contract Non operational Non operational Not available 1,1 1 st quarter of Investments millions DA,,8 Not available, 1 1,9 Non operational Cancellation of the contract Non operational Non operational Not available,8 -The park of the Net surfers The access to Internet is usually done via PSTN, ADSL, LS, and cable or by satellite. a) Internet in free formula The access via PSTN requires a special number or a short number. For the free formula, it is impossible to know the subscribers number; therefore, we satisfy ourselves with an estimated number of users. On a total of users, we count 1981 for Djaweb and for EEAPD. Over the three studied months, we estimate the number of connection to the short numbers (special) at 7 for the six () suppliers of access, including connections carried out by Djaweb, that is 8% of the total number of connection. Djaweb is the most valued by the users of free formula; this one receives on average 991 connections per day. For the other ISP, the figure varies between and connexion per day on their special number. 8 Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

9 The Market of telecoms b) Internet subscription The subscription to Internet is possible for several type of access, that it is PSTN, ADSL, LS, satellite or Wimax On a total of subscribers, those using PSTN access are the most; subscribers, followed by those using ADSL access; 19 1 subscribers. However, it is useful to recall that if PSTN access counts only one user because of the capacity, access by ADSL, LS, satellite, and wimax can enter a number of users who can vary from 1 to 1 or more, according to the band-width capacity. Operators PSTN Subscribers number till 1// LS ADSL Satellite WIMAX Total BMGI CASTELUM NET EEPAD FORCE NET I.ALGERIE ICOSNET PROCOM INTERNATIONAL SAAD NET SAT LINKER SERI SLC TDA VOCALONE WEBCOM DJAWEB TOTAL , BMGI sells ADSL in partnership with EEPAD and the satellite connections in partnership with AT Castellium Net sells the ADSL in partnership with AT Source : ISP Operators Number of Cybercafes clients till 1// LS Capacity ADSL Capacity Total Connexion Volume Unity : Minutes BMGI CASTELUM NET EEPAD FORCE NET I.ALGERIE ICOSNET PROCOM INTERNATIONAL SAAD NET SAT LINKER SERI SLC* TDA VOCALONE WEBCOM DJAWEB TOTAL Source : ISP Among the ISP customers, we find the cybercafes, of which the number rises to 8 with a majority which is connected via ADSL () and by LS capacity (117). The traffic generated by Internet connections via PSTN during the 1 st quarter of, rises to 11, 1 million minutes, of which the majority (89,9 million minutes) are carried out by Djaweb, followed by Vocalone with 1 million minutes. A connection endures minutes on average. Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 9

10 The Market of telecoms VoIP: A difficult start of the operators It is already more than one year that the VoIP service (transfer of Voice over Internet Protocol) is opened up to competition in Algeria, it is so much then to make a first assessment. For recall, the Algerian government had initially carried out the simplification of the legal regime which governed this segment in order to align it with that of the authorization, an action which the authorities took in order to make available other access modes of the telecommunications services and to create a more significant rise on the telecommunications market particularly in the fixed telephony field and the Internet with high flow, on which Algeria shows a considerable delay compared to the other developed and emergent countries. The opening up was really realized within a short deadline (April /) by the authorizations attribution by the ARPT for the VoIP networks establishment and exploitation to 11 national operators. However, and in term of the legal devices, these operators should launch the services exploitation in their networks within to 8 months as from the date of their authorizations notification, this period is considered necessary to proceed to the installation of the necessary equipment and software to a VoIP network. In parallel, numbering blocks of 8xxxxxx type were allotted by the ARPT to operators, among them only one operator is currently operational. Operator EEPAD SMART LINK Communication LAST NET ALGERIA VOCALONE WEB PHONE ICOSNET In addition, commercial conventions were signed between AT and the ISP aiming at providing the VoIP service. Short Number VoIP Number 8 xxxxx 8 xxxxx 8 xxxxx 8 8xxxxx 8 9xxxxx 8 xxxxx It is thus obvious that all the conditions seem joined together in order to reach the progression predicted in the VoIP market. Nevertheless, the last evolutions noted on the market and the investigations of follow-up of the operators concerning this activity, made by the ARPT, let believe in a difficult starting of this service, indeed only one operator in fact EEAPD launched its commercial offers called Assilabox on the market, by proposing three type of formula in form of voice and Internet high flow package (VoIP and ADSL) intended to a professional public as well as residential one. The EEPAD is the first to start... These offers are summarized in three types of products which propose internet with high flow from kb/s until 1Mo/s and fixed telephony, this formula is more known in the world by the dual-play (see table bellow). Attribution of a number of the type 8X XX XX Place Assilabox package at the disposal within the framework of a contract of fidelity. Type of products Assilabox Assilabox+ Characteristics Unlimited Internet Connection to kb/s Unlimited Internet Connection to 1kb/s. Unlimited calls towards the numbers 8xxxxx Choice of initial credit between these proposals: h towards the national fixed h towards the international fixed h towards Mobilis h towards Nedjma Target public Residential Residential Professional Tariffs of the lump price DA/ATI 9/month 999/month Communications tariffs DA/ATI/mn towards the national fixed: towards Djezzy : 8 towards Nedjma : 8 towardsmobilis :. towards the national fixed: towards Djezzy : 8 towards Nedjma : 8 towards Mobilis :. 1 Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

11 The Market of telecoms Type of products Assilabox office Characteristics Unlimited Internet Connection to 1kb/s. Unlimited calls towards the numbers 8xxxxx Choice of initial credit between these proposals: h towards the national fixed h towards the international fixed h towards Mobilis h towards Nedjma Target public Professional Tariffs of the lump price DA/ATI 9.999/month Communications tariffs DA/ATI/mn Towards national fixed: Towards Djezzy : 8 Towards Nedjma : 8 Towards mobilis :. The ARPT launches a market study... At the aim of having precise quantitative and qualitative information on the real impact of VoIP on the telecommunications market, the ARPT urged an engineering and design department to carry out a survey of market targeting all the VoIP operators. The results of this study will have to bring the answers to the interrogations of the ARPT. The market of telephony and Internet in the MENA area Telecommunications are a sector in full evolution in the world and in particular in the MENA area (the Maghreb and Near East) under the double effect of the economics liberalization and the information technologies modernization in their countries. Like the other areas, the market of telephony and Internet has experienced a development, in particular the mobile segment which exceeded the most optimistic forecasts of the operators and the specialists of the field. The digital revolution which touched the whole world whose two emblems are incontestably the mobile telephony and Internet, make from now on the topicality of the populations and the sector companies. They contributed to the deep change of the organization and production modes of the companies, as well as the habits of assumption and the dynamics patterns of growth. This article aims initially, to evaluate the situation of the fixed and mobile telephony and Internet till the end of, in the majority of the MENA area countries and will also allow knowing the position of the Algerian telecoms market compared to the other countries of the MENA area. 1- Statute of the market in the MENA area in Following the telecommunications market s liberalization, new operators enter to the market, and competition is then established between the actors. this new situation requires an effective regulatory and interconnection regime in order to guarantee the success of the liberalization. The telecommunications markets in the MENA area are mainly markets in monopolistics situation for the mobile telephony services. the mobile telephony analysis (duopoly situation or competition) shows the variety of the regulatory regimes from one country to another. Fixed telephony market Monopoly Duopoly Competition Monopoly Duopoly Competition Libya U.A.E. Mobile telephony market Morocco, Tunisia, Egypt, Bahrain, Kuwait, Saudi Arabia, Lebanon, Syria, Jordan, Oman, Malta Iraq Iran Turkey Algeria Source : operators & regulators Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 11

12 The Market of telecoms - The ICT indicators in the MENA area Year Membre states Algeria Morocco Tunisia Libya Egypt Bahreïn Irak Iran Kuwait Saoudi Arabia Lebanon Syria Jordan E.A.U Oman Turkey Malta Fixed Telephony Subscribers number Density (%) Mobile Telephony Subscribers number Density (%) Qatar TOTAL % The market of fixed telephony in the MENA area Internet Net surfers number Density (%) Penetration of fixed telephony % % % % 1% *Estimate % Algeria Morocco Tunisia Libya* Egypt Bahrain* Iraq* Iran Kuwait* Saudi arabia Lebanon* Syria Jordan* Qatar* United Arab Emirates Oman Turquey Malta* 1 Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

13 The Market of telecoms The market of mobile telephony in the MENA area 11% 1% 9% Penetration of mobile telephony 8% 7% % % % % % 1% *Estimate % Algeria Morocco Tunisia Libya* Egypt Bahrain* Iraq* Iran Kuwait* Saudi arabia Lebanon* Syria Jordan* Qatar* United Arab Emirates Oman Turquey Malta* The Internet market in the MENA area Internet Penetration (net- surfer/1 inhabitants) % % % % % 1% 1% % % Algeria Morocco Tunisia Libya* Egypt Bahrain* Iraq* Iran Kuwait* Saudi arabia Lebanon* Syria Jordan* Qatar* United Arab Emirates Oman Turquey Malta* *Estimate Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 1

14 The Market of telecoms - Tariffs of the call termination on the fixed and the mobile networks One of the principal levers of the market regulation of the wholesale interconnection market tariffs, thus the operators have as an obligation to publish their interconnection catalogues in which the tariffs of call termination appear. The regulator carries out the catalogues approval after examination of the interconnection offers, to check if the tariffs applied are established in the strict respect of orientation towards the costs principle. The MENA countries apply very heterogeneous tariffs of calls termination from one country to another for the fixed as for the mobile telephony (see graphs below) Local Simple transit Double transit The tariff of a call termination on the fixed network Algerian Dinar 1 Algeria Morocco Tunisia Egypt Bahrain Saudi arabia Syria Jordan United Arab Emirates Oman Turquey Malta The tariff of a call termination on the mobile network 1,1 11, Algerian Dinar, 8, 7,, 7,9,9,8 8,7 7,98,8 Algeria Morocco Tunisia Egypt Bahrain Saudi arabia Syria Jordan United Arab Emirates Oman Turquey Malta 1 Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

15 The Postal Market The International Accelerated Mail For recall, the overall results of volumes number of the treated mail recorded by the operators as well for the Import as for Export, appeared in the preceding report. An increasing tendency had, then, been observed. The report n had informed on the new authorizations () granted to two operators (Chronopost and Fedex). The present report, in addition to the statistical data contained in table n 1, the table n gives state of the indicators concerning the traffic evolution of each operator, for the various relations of mail exchange. An increasing evolution Share of market per operator till June, th Table n 1 gives information about an ascending evolution of the volume of the mail treated by the five operators for Export and Import. It also indicates the share of market till June, th for each intervening part. 1, %,9 %,77 % 7, % DHL EMS 11,7 % UPS Chronopost That, generally, gives what follows: FedEx Express o Export: + 8 objects, that is,,9 % o Import: + 91 objects, that is,,8 %. Total trafic Export / Import (Evolution and share of market ) Table N 1 Unity: postal object Operators S1 S1 Export Difference % S1 S1 Import Difference % Global trafic Q1/ Share of market % DHL ,8% ,1% 17 7,% EMS ,% ,% 8 11,7% UPS 9 1 8,% ,8% 1 1,% CHRONOPOST ,9% FEDEX ,77% TOTAL ,9% ,8% % Source: operator Asia; the most valued destination after France A situation on the volume of the mail exchanged by each operator in the various relations is given in table n. The examination of the figures indicates that in the Asia relation all the operators record an increase in the traffic. That is not the case for the other relations. Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 1

16 The Postal Market Comparative situation 1 st Six-month period and per operator and in each relation Table N Periode S1 S1 Evolution % S1 S1 Evolution % S1 S1 Evolution % S1 S1 Evolution % S1 S1 Evolution % S1 S1 Evolution % S1 S1 Evolution % DHL ,1% ,% EMS ,9% ,% Export UPS ,% 18 9,11% ,1% 17,78% 11,7% ,% ,1% CHRO FEDEX DHL " FRANCE" RELATION ,87% ,% ,% EMS ,9% " ARABE COUNTRIES" RELATION ,% -,7%,9% ,89% -9,9% ,8% " ASIA" RELATION "AFRICA" RELATION 8 1 9,18% 1 1 "AMERICA" RELATION 9 89,8% ,18% ,8% Import UPS ,% ,% ,1% ,% 1,% -7,8% ,89% ,1% ,17% "OTHER COUNTRIES" RELATION ,% 9 1 8,% ,8% ,99% 7,% GENERALN TOTAL PER OPERATOR ,1% ,% ,8% Unity: postal object CHRO 11 11,%,% FEDEX Source: operator 1 Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

17 Reflection The unbundling of the local loop Today, the local loop is based as well on wire technologies as those which use radio technologies. In the general case, the physical connection of the last kilometre (local loop) of a wire phone is done thanks to a twisted pair of copper. The local loop is the part of the telecommunications network ranging between the phone plug placed to the subscriber and the distributor located in a local centre. It is the basic infrastructure allowing the supply of the telecommunications services such as the telephone and the data transmission. What is the unbundling of the local loop? The local loop network is the property of only one operator, in fact the incumbent operator. The unbundling gives the possibility and the right to the alternate operators (new entering) to use the local loop of a competing operator to convey their own traffics. It thus enables them to install their own equipment in the local centres of the incumbent operator, in order to ensure themselves the distribution and the supply of the services to the users with their own tariffs. The Various forms of the unbundling The unbundled access to the local area network can be total or partial. It consists respectively in making at the disposal of the alternate operator: the entire frequency bands of the pair of copper. or the high frequency band of the pair of copper. We can also have two other forms of unbundling, which are: unbundling with the sub loop resale of access with high flow (bit stream): It should be noted that the offers of bit stream are not always regarded as unbundling. Elements to be unbundled The unbundling can pertain to several elements of the local area network, we mainly quotes: Metal lines (pair of copper) in the total unbundling; the high frequency part of the metal line (paire of copper) in the partial unbundling; supports of transmission used by the incumbent operator to convey the traffic from the buildings where finish the metal lines until the access points of its wide area network or up to the competing operators points of presence in or close to the distributors. Alternatives to the local loop unbundling Several solutions can be considered like an alternative to the unbundling, they are: radio: like WiMAX... etc network of cable television CATV optical fibre, transmission current on line Actors of the unbundling The access to the local loop puts in scene several groups of intervening parts, they are: The operator who has the local area network and who will make at the disposal of the other operators the unbundled lines; Alternate operators: they are generally, either the fixed telephony operators, or the Internet access suppliers (ISP); The Regulatory Authority; Equipment suppliers. The unbundling and portability With the total unbundling, the alternate operator completely replaces the incumbent operator, for the offers with high flow on one hand, and for the subscription to the telephony offers on the other hand. In general, the alternate operator asks for the portability of the telephone number in this type of unbundling. Indeed, in the absence of the number portability, the subscriber would have to change the telephone number to be able to profit from the offers of the total unbundling; this number change can constitute a significant barrier to the operator change. Advantages of the unbundling - To reduce the economic obstacles against the entry on the market of alternate operators; - To encourage the innovation by allowing the combining of new technologies with elements of the established network; - To avoid unnecessary duplication of elements use; - To facilitate the access of the alternate operators to the sites of the local loop elements; - To support the development of the Internet with high flow and multiple play. Disadvantages of the unbundling - Requires a regulation intervention and a detailed technical coordination; - Can discourage the construction of alternative networks. - Involves a fracture between the dense zones where the final customer will be able to see himself proposed high flow offers and the less dense zones where the service will not be available or proposed only by the incumbent operator. The unbundling in Algeria The high flow multi-media applications appearance have encouraged the officials in charge of the telecommunications sector in Algeria to introduce new technologies which made it possible to the users to fully profit from their advantages. Indeed, in nd, November, the Minister of the Post and the Information and Communication Technologies boosted the ADSL launching. It is the EEPAD, in partnership with Algérie Télécom which had taken this initiative. Several districts of the great cities, in addition to the cybercafes and the institutions, have profited from the high flow. The success of this operation has allowed the evolution of the high flow applications in addition to the introduction of DSL new technologies on one hand, as well as it has encouraged the actors of this field to invest on the other hand. Indeed, in February 1th, Algérie Télécom in partnership with the Chinese manufacturer Huaïwei launched the marketing of. ADSL lines. During the liberalization of the telecommunications sector, the Algerian regulation did not envisage a legal framework for the local loop unbundling. The year has known the introduction Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 17

18 Reflection of new actors in the telecommunications Algerian market; they are TAC; the second fixed telephony operator and the VoIP services operators. It is not possible economically for a new operator to completely duplicate the local loop. The opening up of this segment to competition will make it possible to the entering operators to make different high flow offers. The development of the high flow services market is extremely promising; it constitutes an essential element for the development of our country. The ARPT, conscious of the unbundling importance, has already taken in charge this file on its level. Studies have started. The experiment of the other countries concerning the unbundling The local loop unbundling introduction differs from a country to another. Some countries had started with the drafting of legal texts before its effective installation, whereas other ones had allowed it for one test period before the setting up of the legal framework. In several countries, the long distance telephony market developed quickly, but competition on the local loop remains marginal. One of the principal means which made it possible to introduce a fair competition into the local loop, is the fact of authorizing the alternate operators to reach this segment of the incumbent operator network in order to intensify competition and to stimulate the technological innovation on the local access market, what has supported the supply of a complete range of telecommunications services to the user. The total unbundling and the number portability represent two processes which are technically distinct; nevertheless, a shift in the implementation of one of these processes could be strongly prejudicial to the total unbundling offers attractiveness. Through the experiment of some countries, the Authorities estimate that, to be able to minimize the time of the final customer cut in the case of the operator change (total unbundling), the portability offer and the unbundling should be realized simultaneously. 18 Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

19 Reflection Wimax L The Wimax Technology (Worldwide Interoperability for Microwave Access) is a solution of radio local loop (RLL) based on 8.1 standard. It allows to carry out fixed microwave links at long distance ( km approximately) and with high flow (up to 7 Mbps). The WiMAX coverage zones are an equivalent of a small city, it allows to cover villages from its basic stations (metropolis cover) in rural zones with weak penetration Wimax INTERNET QuickTime et un décompresseur Graphismes sont requis pour visionner cette image. (see fig 1). The WIMAX can be an alternative to the access to the Internet with high flow. It can come in complement from the WIFI to cover broader zones, making thus possible the concentration of WIFI hotspots. Wifi Company Wimax Regulatory in some countries: Wimax can be available with or without licence. It is generally preceded to what follows in some countries, concerning the Wimax technology regulatory: Exempted spectrum from the licence Wimax is exempted from a licence in some countries for the following bands: Wimax,8 GHz (band without licence); Another band with, GHz not requiring a licence should be added, and may be other bands after that Other frequencies can exist (see fig) Spectrum not exempted from the licence: It is about:, and, GHz (bands requiring a licence). Other frequencies can exist such as the band of 9 MHz (in the USA). It is to be recalled that the management of the frequency bands remains specific to each country. Operator FS I Acces Point 8.11 Antenna Transmission infrastructure 8.1 Antenna Reception Tr ansmission po int- multipoint 8.1 The band of, GHZ in Algeria: The ARPT is beneficiary from the band of, GHz for the exploitation of public telecommunications network of the WLL type, urban and/or rural. The band of, GHz is a scarce resource, which explains why it is necessary to obtain a user licence of local loop or an authorization of the VoIP services exploitation and supply. Indeed, the ARPT has allotted Wimax authorizations to the fixed telephony operators. The recipients of Wimax authorizations in the band of, Ghz are the following: Two operators of fixed telephony (AT and CAT). The VoIP operators: SLC LAST NET ALGERIA EEPAD ICOSNET WATANIYA ANOUAR NET Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 19

20 Reflection Triple Play or television via ADSL With the advent of new technologies, the earth globe has become, a village, as well as it has become imperative to line this powerful lever of the social, economic and cultural changes. It is not false to say that globalization implies stakes, from where the incidences on the inheritance of each country which suffer, without any doubt, from dependence on those which hold and control best new technologies. The world of telecommunications appropriates a separate field, which became integral part of the offered services. It is the world of the audio-visual. This fulgurating development of IT new services and the ADSL in particular, has like reverse of medal, to question the established texts and rules. The regulator has to face new constraints in term of contents in political matter (broadcasting) and the communication services costing which belong to two different sectors that are the telecommunication sector and the communication one. Where are the limits of the authorities? In some countries where the regulator cumulates two sectors regulatory, such as the FCC of the United States of America, the CRTC of Canada and the OFCOM of the United Kingdom, the regulatory constraints are lesser because they were the precursors in this field. The French regulator has reached a stage in this direction by changing the name of ART by ARCEP through the law relating to the electronic communications and the audio-visual communication services (known as transposition of telecoms package ) adopted in June, rd. More close to us, the regulator of Morocco ANRT gave its downstream for the introduction of the audio-visual services in June by the means of the ADSL. The question that we could aske is what is for Algeria? Algeria, following the emergent countries example, through an ambitious sectorbased policy, focussed much on the IT and in particular the Internet with ADSL as a vector of telecommunications sector development. The Minister of the Post, the Information and Communication Technologies, Boudjema_ Haïchour, during the inauguration of the experimental system Epon (Ethernet passive optical network) last September launched from the telephone exchange of Hydra, evoked this possibility, which will allow in the future offering the triples play service (television, Internet, telephony) to the subscribers. In this system, a traditional television set will have to make the deal. It is enough to be simply equipped with a small case which will play the role of a digital receiver. This ADSL terminal, or more commonly the digital decoder deciphers the signal and transmits it to the television set by a Scart catch or RCA. It would be judicious to announce that the contribution of this new technology would allow to the citizen the easy and fast access to the information society. It is for that reason that Algeria aspires to ensure its place through an innovative IT policy, and an ex ante regulatory policy to the increasing of the technological changes, by engaging reflections or exhaustive studies on a given subject. Today, the Algerian regulator ARPT cannot intervene to control this service in absence of legal texts. Nevertheless, projects with legislative and regulatory feature are being in reflection between the authorities concerned by this segment, in fact the MPTIC and the ARPT in order to found the necessary framework allowing the exploitation and the development of these new services in Algeria. Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September

21 Reflection The spectrum: a scarce resource If the following question were asked: Which is the most outstanding invention of this century? Many of the answers would undoubtedly be the telephone, the radio / the television or the plane. These three products are dominated by the radio communications. The world of today is full of plenty applications calling upon the wireless communications, such as for example the mobile telephone, the talkie walkie, the wireless microphone, the remote control of various objects and natures, the radio electrical networks as R-LAN, WiFi (wireless fidelity), Wimax (World Interoperability for Microwave Access), WAS (Wireless Acces System), and all the satellite systems, the radio and television etc The modern mode of consumption evolves to the roaming, the portability and the increasing and innovative use of telecommunications applications calling upon Hertzian space. The spectrum frequency is developed more and more, the request is increasingly strong obliging the whole of the countries to tend towards an optimal use; the use of the various techniques and technologies to make denser the spectrum use. The use of the frequencies requires a harmonization on a world, regional and national level. International framework The globalization has supported a certain normality of the spectrum frequencies legal and management issues. The issues of the spectrum frequencies in terms of standardization, the radio communications and development, are treated on a world level with the International Telecommunication Union (ITU) which gathers 189 countries. Founded in 18, the ITU is an intergovernmental organization. During a conference held in Atlantic City (the USA) in 197, the ITU established an agreement with the United Nations becoming thus its specialized agency. It is founded and managed by legal instruments which are the Constitution, the Convention and the Radio communications Regulation. The Radio communications Regulation (RR) is amended and enriched by the Member States during the World Conferences of the Radio communications which are held periodically from two to three years of interval. This last contains, in its Article n, the frequency bands attribution table to the radio communications services, the procedures of notification and recording of the frequencies in the Master International Frequency Register (MIFR) and their connections with the Frequencies Plans, the methods and the rules of the frequencies use and the orbit of the geostationary and not-geostationary satellites. The frequencies use at the national level must imperatively respect the RR and particularly Article. The RR, which indexes more than services and almost as many types of radio electrical stations, and all the ranges of emission, has a value of Treaty between the States. Its provisions have an obligatory feature. Any exemption, whose use of frequency can bring a constraint to another country, is registered in the footnotes of this Article. Currently, the ITU celebrates on October th; of this year, the Radio communications Regulation centenary. National framework At the national level, Law n -, promulgated on August th, is the fundamental Law on telecommunications. The general structure of this regulation which answers to the broad political, economic and social objectives of the country, is conceived of such manner to allow the telecommunications development in an environment open to competition and the private companies, to guarantee a universal service to all the citizens and to guarantee the transparency and the non discrimination in its rules and its decisions. This law framework, which falls under a world environment characterized by an increasing deregulation and the globalisation in the economic field, has set up the Post and Telecommunications Regulatory Authority (ARPT), as the governmentowned body of telecommunications markets regulatory and scarce resources management, particularly the frequencies spectrum. Once the telecommunications policy is defined by the Ministry of the Post, Information and Communication Technologies (MPICT), the general structure of this regulation allows the ARPT to enjoy an autonomy in its decisions concerning regulation and spectrum management which is allotted to him. The legislator, after having set up the telecommunications fundamental Law - of August th,, promulgated executive decrees for this Law application. These executive decrees clarify, for instance, the radio electrical networks exploitation modes, and the assignment pricing of the (de_-18) frequencies. Moreover, the decree of creation de_-97 of the Frequencies National Agency (FNA) of March nd,, specifies the relation of the FNA with the ARPT. Indeed, Article 1 of the law fixes the activity sphere of the ARPT in the Hertzian space, to only the frequency bands which are allotted to it without defining by which organization or institution. The decree of FNA creation precisely specifies this relation with the ARPT, by creating in the FNA two Statutory Commissions, namely the Frequency Bands Attribution Commission and the Commission of Jamming. The FNA is charged to set up at the national level, a National Table of the Frequency bands, that is the equivalent of Article of the RR, which each organization, operator or user has to respect and to apply with rigour. The importance of radio electrical telecommunications is not any more to show. In this sector, technologies and techniques develop quickly imposing to the regulatory body, to anticipate the difficulties and the changes, to plan and to manage in a dynamic way the frequencies spectrum. Quarterly Report of the Post & Telecommunications Regulatory Authority N & - September 1