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ITU meeting of Arab Regulators. Algiers 19-21 April, 2003. Orascom Telecom Algérie brief presentation. Subsidiary of Orascom Telecom Group (Egypt) Licence in Algeria as 2 nd GSM operator awarded to OTA: August 4 th , 2001 Commercial launch in Algiers: February 15 th , 2002

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Itu meeting of arab regulators

ITU meeting of Arab Regulators

Algiers 19-21 April, 2003


Orascom telecom alg rie brief presentation
Orascom Telecom Algériebrief presentation

  • Subsidiary of Orascom Telecom Group (Egypt)

  • Licence in Algeria as 2nd GSM operator awarded to OTA: August 4th, 2001

  • Commercial launch in Algiers: February 15th, 2002

  • Brand Name: DJEZZY GSM

  • Currently

    • 500 k+ subscribers

    • Network in 38 Willayas (on a total of 48)

    • 100 roaming partners


Ota interconnection with pstn
OTAInterconnection with PSTN

  • PSTN operated by Incumbent Operator Algérie Télécom, under separation from Ministry, also our competitor as 1st GSM Operator

  • Currently no clear separation of GSM activities vs others

  • Interconnection Issues

    • National termination charges were easy to negotiate thanks to clear frame in the GSM licence

      • PSTN  OTA 6.5 DA (8 UScents)/min

      • OTA  PSTN (local switches) 1.2 DA (1.5 Uscents)/min

      • OTA  PSTN (transit switches) 2.4 to 2.8 DA/min


Ota interconnection with pstn1
OTAInterconnection with PSTN

  • Interconnection Issues (ctd)

    • International incoming termination charges are still a problem

      • PSTN  OTA (international In) 1.2 DA (1.5 Uscents)/min

      • OTA  PSTN (international Out) 80% of public rates

    • Direct costs of interconnection

      • All POIs are in the PSTN => We bear all transmission costs to the PSTN (LL or own Links)

    • Leased Lines

      • Public Price = No volume discount

    • QoS / Service Level Agreement

      • Bad QoS (esp. LL) not in line with basic SLA in contract

      • No offer for various Service Levels

      • Delivery Timing not reliable


Ota interconnection with other gsm
OTAInterconnection with other GSM

  • Interconnection Issues (ctd)

    • Termination charges could not be agreed upon

    • Arbitration escalated to ARPT

      • ARPT ruled based on cost analysis

      • Symetrical Termination Charge between 3 and 4 DA/min to be re-assessed after end 2003

      • Agreement reached on 4 DA/min

    • Still we see problems of coherence

      • PSTN originated call GSM terminated is 6.5 DA/min when GSM1 originated call GSM2 terminated is 4 DA/min based on same underlying cost orientation principle

      • Our own cost analysis (Minimum Retail Price Method) showed costs in the range of 6 DA/min for a GSM termination


Ota other regulatory issues
OTAOther Regulatory Issues

  • Cross-subsidies by incumbent Operator

    • Their present GSM rates are obviously below costs

    • Arbitration has been escalated to ARPT

  • No licence fees paid for GSM by the incumbent operator

    • They did not participate directly or indirectly (e.g.Right of First Refusal) in the Tendering process

    • We see it as a breach of non-discrimination principle clearly stated in the Telecommunication Law

    • We see it as a breach of licence awarding principles clearly stated in the same Telecommunication Law

    • Definitely not in line with International Regulations and Practises


Ota conclusion new entrant expectations as regards regulator intervention
OTAConclusion: new entrant expectations as regards Regulator Intervention

  • Regulator has to go deeper into Interconnection issues on all aspects…

    • Termination charges and Leased Lines prices

    • Direct Costs of interconnection

    • QoS and Service Levels

    • Delivery timing

    • Etc.

  • …and on all issues related to fair competition

  • This should result in a comprehensive set of rules clearly stated in the different licences/authorisations or at a higher level

  • This is critical in the first phases of opening to competition in order to protect new entrants (esp. Small ones) and guarantee smooth transition to a fully competitive environment


Itu meeting of arab regulators
OTA

Thank You for Your Attention