Papua New Guinea - Strategy & Project Outline (Oct 23 2008)

Rural Telecommunications Strategy for PNG

Agenda ,[object Object],[object Object],[object Object],[object Object]

Overall Approach ,[object Object],Universal Service Frontier (100%) Access Gap Sustainability Frontier Market Efficiency Frontier Market Gap Current access Low Income Households High Income Households Low cost Areas High cost Areas Supply Demand Penetration level achievable in a well-functioning competitive market under a stable regulatory environment Requires Universal Service Fund, but once demand catches up, service is expected to cover its operational costs. Port Moresby, main cities Mobile Competition World Bank Project

Closing the market gap is key ,[object Object],[object Object],[object Object],[object Object]

Key questions in designing a universal access program ,[object Object],[object Object],[object Object],[object Object],[object Object]

Gradual introduction of competition in PNG is reducing the market gap ,[object Object],[object Object],[object Object]

Digicel is increasing its coverage nationwide…

… and Telikom needs to frequently update its backbone

Internet access is still very low ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

The regulatory framework is still incomplete ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Close the market gap ,[object Object],[object Object],[object Object],[object Object],[object Object]

Close the Access Gap: Universal Access Program ,[object Object],[object Object],[object Object],[object Object],[object Object]

Close the Access Gap: Universal Access Program Universal Service Frontier (100%) Access Gap Sustainability Frontier Market Efficiency Frontier Market Gap Current access Low Income Households High Income Households Low cost Areas High cost Areas Supply Demand ZONE 1 ZONE 2 ZONE 3 Pending on-going review, and analysis of network coverage, the main target areas for the RCF should focus on zone 2 As demand expands and costs decrease, locations in zone 3 should become viable in time and eventually be included in future tenders

Universal Access (2) ,[object Object],[object Object],[object Object],[object Object],At least 5km away from the nearest payphone ≤ 500 Access to broadband and value-added services ≥ 1,000 Phone coverage plus one public access point per every 500 inhab. ≥ 1,000 One public access point (eg payphone) 500 ≤ 1,000 Target service Population Threshold

Universal Access (3) Project A tender process Operator 1 Operator 2 Operator N ,[object Object],[object Object],Proposals ,[object Object]

Smart Subsidies ,[object Object],[object Object],If project is financed with private resources Net present value for private parties: -K10 million If project is financed by private and public resources Net present value for private parties: -K0 Subsidy: K10 million

Some characteristics of smart subsidy reverse auctions ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Universal Access (3) Operator 1 Operator 2 Operator N Universal Connectivity Fund Contribution Usually % of net revenues Universal Connectivity Fund Collection ,[object Object]

Universal Access (5) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Universal Access (6) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Scope and activities ,[object Object],[object Object],[object Object],[object Object],[object Object]

Current status and next steps ,[object Object],[object Object],[object Object],[object Object]

Papua New Guinea - Strategy & Project Outline (Oct 23 2008)

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