OBJECTIVES• Overview of the Issue• Policy for analysis• Strengths and Weaknesses• Recommendations• Implications
OVERVIEW OF THE ISSUE IN LEBANON’S TELECOMMUNICATIONS SECTORPrior to 2002-2007 privatization efforts:• Lebanese Government, Ministry of Telecommunications (MOT) held a monopoly over domestic and international telecommuncations.• The state owned company, Ogero, was responsible for purchasing, sale and supply of all key ICT infrastructure, including internet services.Outcome:• Extremely inefficient internet service at high prices (due to centralized system).• Low bandwidth capacities and availability.• Low internet penetration in the country.• Increased presence of illegal ISPs squeezing bandwidth capacity.
OVERVIEW OF THE ISSUE IN LEBANON’S TELECOMMUNICATIONS SECTOR• 2007 Ministry of Telecommunications establishes the Telecommunications Regulatory Authority (TRA),an “independent” public agency to liberalize, develop and regulate the telecommunications sector.Among other functions, the TRA:• “d) organizes concessions, issues [service provider] Licenses, ensures compliance with License terms and conditions, monitors, amends, suspends and withdraws Licenses in accordance with the provisions of the present Law and its implementing decrees” (Telecommunications Law 431, 2002).
THE TRA WAS ESTABLISHED AS A “WATCHDOG” AGENCY….. …..But for whom?
2009 DRAFT LAW: SERVICE PROVIDER LICENSING REGULATIONArticle 15, Section 1: Application for Class Licenses without Radio Frequency“Any person wishing to apply for a class license without radio frequency must doso in writing by submitting the information specified in Schedule D of thisregulation” [To be processed by the Telecommunications Regulatory Authority].Article Objective:• To establish formal application process and procedures for Internet Service Providers (ISPs) to enter the telecommunications market with ease• To encourage competition in the internet service provider industry• To improve overall internet penetration by offering more ISPs.
2009 DRAFT LAW: SERVICE PROVIDER LICENSING REGULATIONArticle 21, Section 1: Conditions in Licenses“Service Provider Licenses may be granted subject to conditions. Any conditionmust be in accordance with the Telecommunications Law, especially with regard to promotion of competition, protection of Customers and the general public.”Section 1c: Provisions in all licenses [Conditions about the protection of users, quality of service, procedure for complaints and disputes, publication of changes in access, tariffs, quality and availability of services must be reported to TRA.]
TELECOMMUNICATIONS LAW 431 CURRENT LAW GOVERNING TELECOMMUNICATIONS SECTOR (2002):Public Service Model Liberal Model with Public Interest TraditionHigh Government Intervention: Low Government Intervention:• Council of Ministers (with proposal • Allows service providers to set their from MOT) determines TRA’s own rates and tariffs based on market administrative and financial prices and conditions (article 28) organization and appoints its • Gives TRA the power to impose prices Chairman and Members (article 4). and tariffs on Service Providers in the• MOT approves all decisions taken by case of monopoly pricing (article 28) TRA (article 3). • Sets the standard of quality for ISPs’• Permits the TRA to collect revenue technical equipment (article 23) from licensing applications and annual fees (article 11)
2009 DRAFT LAW: SERVICE PROVIDER LICENSING REGULATIONArticle 21, Section 1: Conditions for all licensesObjective:• To promote transparency between ISPs and TRA• To improve accountability for quality and available internet services• To establish the TRA as a “watchdog” of citizens interests• To increase internet penetration rates in supplying quality service to users.
2009 DRAFT LAW: SERVICE PROVIDER LICENSING REGULATIONStrengths Weaknesses• Low entry barriers for ISP licensing • Private companies are forced to allows for private ISPs to enter the compete with the government owned market with ease. company, Ogero, who has an unfair advantage over key ICT infrastructure• Improves transparency and and equipment. accountability between the government, public and private sector. • Policy does not take into account bandwidth capacity available for sale• Increases competition in the service to ISPs. provider industry. • Fails to set minimum bandwidth speed• Absence of censorship and technical that must be offered to customers. filtering.
RECOMMENDATIONS Schools Online Lebanon’s Government: • Ban Ogero from withholding bandwidthUntil bandwidth capacities capacity from the market.increase… • Provide private ISPs with same access to key ICT infrastructure (such as DSL,And competition between the cable, fixed telephone telephone lines)government and private sector is on that the government has to promote fair competition.equal footing…. • Enforce minimum bandwidth speed that ISPs must provide users. • Incentivize (with lower monthly internet• It is not recommended for costs) new educational businesses Schools Online to establish and non-profit initiatives, like Schools Online, that seek to increase internet offices and Internet Learning connectivity in LB. Centers in Lebanon.
IMPLICATIONS Lebanon International Relations:Consequence: Consequence:1. Less foreign investment interest; including educational non-profits seeking to improve • International governments are aware of large internet connectivity in public schools. discrepancy between written law and reality in2. Telecommunications sector will never be truly Lebanon. a liberal market until bandwidth capacities are increased and privatized, and private ISPs • While foreign investments enjoy the same have equal access to key ICT infrastructure. commercial liberties as domestic investments,3. Persistence of digital divide between rural and operational costs will be higher for urban population. international businesses requiring efficient internet services.Opportunity:• Truly liberalizing the telecommunications Opportunity: sector would provide jobs to the thousands of • High incentives from TRA for foreign highly educated and skilled Lebanese workforce in need of employment. entrepreneurs in information services to form international-local partnerships.• Lebanon could be a regional ICT powerhouse in the future!
THANK YOU!If you have additional questions, please see the full policy analysis report at the following address: http://lebanoncommunicationspolicy.wordpress.com/summary/