MONGOLIA

1. MONGOLIA Rural ICT Policy Advocacy, Knowledge Sharing and Capacity Building Regional Project Regional Multi-stakeholder Discussion Forum on Rural ICT Development Bangkok, Thailand, 4 July 2011

2. ICT Sector Overview • State Institutional Structure • Policy and Regulatory Frameworks • Funding Mechanism • Rural ICT Initiatives • Key Lessons • Future Actions Content

3. Timeline of ICT Sector Development • Separate Business from Policy (1992) • Sector Reform (1993-1994) • Restructuring & Privatization (1995) • Law on Communication (1995) • From Analogue to Digital (1995) • Competition in a telecom market (1996) • liberalization (2001 - 2006) • Renewed Law on Communication (2001) • Establishment of CRC (2002) • Establishment of ICTPA (2004) • Sharpening of the Mobile Market competition (2006) • Universal service/Universal access policy (from 2007) Overview

4. Sector Players Basic Indicators ICT Sector in Mongolia • Fixed line operator – 4 • Mobile network operator – 4 • (3G license in 2009) • ISPs – 77 • International VoIP service provider - 28 • IPTV – 2 in 2009 • Mobile TV – 2 in 2009 Others Infrastructure and Service • 161 soums (village) are connected by FO out of 331 • Over 12.000 km fiber optic (state and private) • All of the soums have at least 1 mobile operator’s service • Most of them have no Internet • ~7% in GDP • 74% of sector revenue is generated from mobile sector • 5% of household income on telecom

5. President Parliament State Institutional Structure Prime Minister Cabinet members of the Government Communications Regulatory Commission (CRC) Information, Communications Technology and Post Authority (ICTPA) Other Ministries NetCo CITIZENS, BUSINESSES, OTHER PUBLIC, AND PRIVATE ENTITIES • Telecoms and IT sectors are overseen by ICTPA, regulatory function by CRC in telecoms • Both institutions report to the Prime Minister • No cabinet-level Ministry responsible for policy-making • Transitioned from a Ministerial policy function to that of the ICTPA

6. Policy Frameworks Regulatory Frameworks Policy and Regulatory Framework • ICT Vision up to 2010 (Parliament of Mongolia, 2000) • E-Government Master Plan for 2005-2010 (ICTA, 2006) • E-Mongolia National Program for 2005-2012 (ICTA, 2005) • National Broadband program (ICTPA, 2011) • Policy Guidelines (GSM 1800, Broadcasting of Digital TV, 3G, WLL etc.) • Draft ICT Government Policy for 2021 (ICTPA, 2011) • Licensing (classifications, conditions, Issue, prolong and cancel licenses and radio frequency) • Numbering • Regulatory service fees • Monitoring QOS • Complains and disputes • Methodologies for service tariff • Determining and controlling dominants • Access & interconnection Privatization & Restructuring Legal Framework • Separated Service from Network (1995) • GOM sold a 40% share of Service Company (MTC) to Korea Telecom • Two separated companies “NetCo” offering wholesale network services on a non-exclusive basis and “ServCo” offering retail services (2007) • Law on Communication (renewed in 2001) • Structure of stakeholders, USOF, Licensing, communications networks etc.)

7. USOF is Legally created in 2001 / operational in 2007 • USOF was able to fully take advantage of the practical experience gained working with 2006 WB Pilot projects • USOF is composed from 2% levies of taxable revenues of communications service providers • 95% is generated from Telecommunications (by 2010) • Control of USOF transferred from CRC to the ICTPA in 2009 • For 2007-2010, USOF disbursed about 85% of collections ($8m) • Expenditure of USOF Funding Mechanism

8. Situation of Rural ICT • Fixed and mobile teledensity are four to five times higher in the urban • Mongolia likely to have 40% of population living in rural areas in mid/long-term • Voice component of universal service is close to being achieved - progress has been undertaken relatively very quickly (in the last 5 years) • Next challenge is the wide-spread roll-out and adoption of broadband • E-Mongolia National Program • Target achievement has varied, with overall about 70%. To date, actual budget has been about 46% of planned. • World Bank financed UAS Program (ICIDP) • A series of World Bank-funded activities that included pilot projects and culminated in the UA/US Program provided technical assistance and subsidy financing (US $5 million) over the period 2005-08 for UAS promotion Rural ICT initiatives

9. 3 Key Lessons from Project/Workshop • Strong Leadership to Support ICT initiatives • Policy makers should recognize key benefits of the ICT (efficient infrastructure) • Cabinet-level ministry plays key role in coordinating ICT related initiatives. (Several funds) • Most of the countries have strong financial support from the Government on the rural ICT development. (PPP) • Sustainability of the project (Telecenter/Internet Café) • Local Governors should play important role in developing rural ICT • Well trained personnel to manage service, attract others (Champions) • To assist on further rural development and infrastructure construction • Ongoing evaluation and review of the effectiveness of the Strategy • Not only Commercial center, but also Community center to provide E-government service and training (15-25%) • Not only basic telephony service, but also Advanced telecom services • Long Term Policy/Master plan on US/UA program and USOF • Set very specific, clearly defined target on the UA/US on long term Policy • Public consultation and transparency of the Policy plays important role • Conduct economic research and result of the initiatives • Separate Policies on both connected and unconnected areas (by backbone network) • Enabling market environment (unified licensing)

10. 3 Objectives for Follow-up • Backbone network • All the economically beneficial areas are already connected to the national backbone network. Therefore in order to reach backbone network to underserved areas, to conduct research on implementing PPP initiatives based on the best practices • To build up right mechanism to monitor and evaluate initiatives on feasibility • Broadband access to rural inhabitants (policy in a high-level decree) • Enable broadband access to households and build up broadband enabled public community center in every villages, accordingly develop local content • ICT vision up to 2021 - Set long term specific targets on UA/US and make it open and transparent (public consultation, public announcement) • Coordinate with other sectors, especially health, education and agriculture • Policy and legal environment • Legislate some important issues such as to Increase responsibilities of Local governors’, coordination with other infrastructure development etc

11. USOF Effect For Mobile service in Rural Area Coverage increased Competition and Traffic increased Increased subscribers Decreased tariff

12. www.crc.gov.mn Монгол Улсын Харилцаа Холбооны Зохицуулах Хороо Overall impacts Mobile subscribers /2005.01.01-2010.06.30/ Total mobile subscribers in Mongoliaincreased 4.3 times during this period

13. www.crc.gov.mn Монгол Улсын Харилцаа Холбооны Зохицуулах Хороо Overall impacts Tariff decrease of mobile on-net voice and SMS /2005.01.01-2010.10.01/

14. Public access point of SWN project Location: Tessoum/150 km from province center/ , Uvs province /1417 km from UB, Distance: 35km from Tessoum

15. THANK YOU