Updated Business Plan

Kyrgyzstan Development GatewayBusiness Plan for FY2004-2005

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TABLE OF CONTENTS

1. PREFACE..............................................................................................................................4

2. EXECUTIVE SUMMARY...................................................................................................5

3. BUSINESS DESCRIPTION...............................................................................................12

3.1 DEVELOPMENT GATEWAY BACKGROUND ................................................................................ 12 3.2 KYRGYZSTAN DEVELOPMENT GATEWAY PROJECT ................................................................... 13

3.2.1 Background .............................................................................................................. 13 3.2.2 Mission ..................................................................................................................... 13 3.2.3 Goals and Objectives .............................................................................................. 14

3.3BUSINESS MODEL ................................................................................................................. 15 3.3.1 Implications from 1st implementation year ............................................................. 15 3.3.1 Socially oriented services ........................................................................................ 15 3.3.2 Paid-for commercial services .................................................................................. 17

4.1 COUNTRY OVERVIEW ........................................................................................................... 20 4.2 INFORMATION INFRASTRUCTURE SURVEY ................................................................................. 20 4.3 INTERNET AVAILABILITY AND AFFORDABILITY ......................................................................... 21 4.4 KYRGYZSTAN ONLINE POPULATION ........................................................................................ 22 4.6 E-GOVERNMENT .................................................................................................................. 24 4.7 LEGAL ENVIRONMENT ........................................................................................................... 25 4.8 TARGET MARKET CHARACTERISTICS AND NEEDS ..................................................................... 27

5. COMPETITION.................................................................................................................29

5.1 ICT MARKET RESEARCH/CONSULTING .................................................................................. 29 5.2 PORTALS SEGMENT ............................................................................................................... 30 5.3 NEWS SITES. KNOWLEDGE DATABASE ................................................................................... 30 5.4 ONLINE DATABASE SEGMENT ................................................................................................. 31 5.5 COMMUNICATION SERVICES ................................................................................................... 32

6. PROMOTION.....................................................................................................................33

6.1 PROMOTION SCHEDULE ......................................................................................................... 33 6.2 PROMOTION CAMPAIGN STAGES ............................................................................................. 33

6.2.2 Building Brand Awareness ..................................................................................... 33 6.2.3 Building Brand Loyalty .......................................................................................... 34

6.3 PROMOTION STRATEGY ......................................................................................................... 35 6.2.1 Online Promotion ................................................................................................... 35 6.2.2 Offline Promotion .................................................................................................... 36

7. TECHNOLOGY STRATEGY...........................................................................................37

7.1 LOCATION .......................................................................................................................... 37 7.2 TECHNOLOGY PRINCIPLES ..................................................................................................... 37 7.3 LOGICAL INFRASTRUCTURE .................................................................................................... 38 7.4 CURRENT PORTAL FUNCTIONALITY ........................................................................................ 39 7.5 PROPOSED TECHNOLOGY IMPROVEMENTS ................................................................................ 40

8. CONTENT STRATEGY....................................................................................................43

8.1 KGDG PORTAL STRUCTURE ................................................................................................. 43 8.2 CONTENT GENERATION AND MANAGEMENT ............................................................................... 44 8.3 TRANSLATION STRATEGY ...................................................................................................... 45

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9. PARTNERSHIP STRATEGY...........................................................................................46

10. ORGANIZATIONAL STRUCTURE.............................................................................48

10.1 GOVERNANCE .................................................................................................................... 48 10.2 MANAGEMENT AND STAFFING ............................................................................................. 48

11. BUSINESS STRENGTHS ...............................................................................................51

12. POTENTIAL RISKS........................................................................................................52

ANNEXES................................................................................................................................54

ANNEX 1. OVERVIEW OF KEY KGDG PARTNERS ........................................................................ 54 ANNEX 2. KGDG PORTAL TAXONOMY .................................................................................... 55 ANNEX 3. TORS OF GOVERNING BODIES OF FOUNDATION “INFORMATION ASSISTANCE” .................. 55

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1. PREFACE

This Business Plan is a dynamic document, the content of which is adjusted on regular basis along with implementation of Kyrgyzstan Development Gateway Project.

This Business Plan, being KgDG planning stage deliverable, pursues, but not limited to, the following key goals:

1. To serve as guidelines for project operation during the Implementation Stage

2. To serve as a tool to motivate and integrate local stakeholders, investors and donor organizations to exemplify analytical and research capacities of the project team

3. To serve as a tool for assessing project performance and assuring transparency of KgDG activity

4. To serve as a tool for disseminating knowledge about potential of using ICT for development

Preparation of this document has been evolved in full compliance with cornerstone principles of the Development Gateway initiative.

Ownership. This Business Plan is a result of the joint creative work of KgDG business plan group members. It presents local vision of development objectives and strategies to attain them. Local stakeholders involved in KgDG Supervisory Board, as well as BP/S team of Country Coordination Unit of Development Gateway Foundation scrutinized draft Business Plan. The present version of Business Plan reflects all remarks and comments suggested by the above groups.

Inclusiveness. All stakeholders were involved in drawing up this document due to its open nature. As this document conceptually mirrors the project implementation process, policy of free access to the Business Plan content will be guaranteed to disseminate knowledge of ICT development and generate new ideas on project development through constructive discussions. Systemic approach. This Business Plan provides comprehensive description and analysis of multifaceted project activities to achieve the goals of socio-economic development. This document incorporates all previous reports of the Business Planning Group (E-readiness and Needs Assessment reports, KgDG Concept Note, other research paper prepared by KgDG) as well as conceptual documents of other project groups: Partnership group, Portal Development Group and Content Group.

Sustainability. This Business Plan formalizes principles of project functioning based on both grant sources and stakeholders donations, defines strategy for attraction partners and gives explicit description of commercial component of the project.

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2. EXECUTIVE SUMMARY

BACKGROUND

The Internet penetrated into most spheres of human life. Great strides have been made to use Internet technology for sustainable development and poverty reduction, but much remains to be accomplished. To complement and leverage the efforts of many groups within the development community, a collaborative initiative of the World Bank Group was launched to create the Development Gateway portal and to establish Development Gateway Foundation.

Kyrgyzstan Development Gateway (KgDG) is a pilot project of the Development Gateway Foundation aimed at harnessing knowledge and Internet technology for sustainable development and poverty alleviation in Kyrgyzstan. KgDG mission is to facilitate comprehensive and sustainable development of Kyrgyzstan on local and global levels through providing online access to high-quality information, communication and transaction toolkits and designing offline solutions for local stakeholders in the field of e-development.

The project mission will be carried out through achieving the following development objectives:

• Leverage the capacity of the government, private sector, donors and civil society to use the Internet as a tool for socio-economic development and poverty alleviation

• Catalyze development of the knowledge economy• Facilitate bridging the digital gap• Facilitate national dialogue and emergence of a shared vision for development

BUSINESS MODEL

The business model developed is peculiar for its multilevel structure - it combines both free-of-charge and paid-for services, which are rendered simultaneously in online and offline dimensions.

• News subscription• Knowledge database subscription• Web-development services• Drawing up recommendations on national ICT policy and e-development pilots• ICT Sector ad-hoc marketing research • Marketing consulting for ICT companies• ICT projects management • Evaluation of ICT Projects

PROMOTION

Promotion plan can conventionally be divided into three stages each of which has its own purposes and objectives:

Stage 1. Presentation and IdentificationMain objectives of this stage include: (1) identifying target groups, which could become potential users of portal resources, (2) identifying target groups' needs regarding information

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content and online services, (3) assessing financial capacity of individual market segments, (4) identifying key partners for implementation of different project activities and services.

Stage 2. Building Brand Awareness By the beginning of this stage prototype of the portal will have to be launched, what determines purposes and objectives of the second stage:

- Providing high degree of awareness about the project brand, mission and objectives- Generating an idea of services rendered within the project framework- Informing key target audiences about basic advantages of cooperation with the project

Stage 3. Building Brand Loyalty Key promotion purpose at the third stage is to gain customer/visitor loyalty and impel project target groups to make decisions on cooperation or purchasing project products or services.

CONTENT STRATEGY

KgDG portal (www.gateway.kg) is the key project element and partnership tool. Portal can be visualized as three-dimensional system bringing together various vertical development communities in a common electronic space at the national, regional and local levels through shared horizontal functional platforms (horizontal portals).

Horizontal platforms Vortals1

• Your Gateway to Kyrgyzstan • KgDG Forum • KgDG Knowledge Databases • My Gateway

• E-Government vortal • Business Development vortal • NGO vortal • FDI promotion vortal

While functional platforms of every vortal will offer many identical functional tools, there will be much vortal-specific content.

GOVERNANCE AND STAFFING

Foundation “Information Assistance” is not a membership-based organization; relationships with partners are formalized through partnership agreements signed by the Project. Stakeholders are also attracted into the Project implementation through participation in the Supervisory Board. Partnerships are essential for the success of KgDG – to support better development outcomes, help mobilize funds, supply content etc. The Project currently involves more than 30 partners – organizations of different forms of ownership, which advance the Project implementation. Any individuals and organizations with development expertise or concerns are encouraged to become involved in KgDG.

Responsibility for day-to-day management of the project is delegated to project manager, which coordinates the following groups, created for project implementation: Business Development Group, Content Group, Partnership Building Group and Portal Development Group.

FINANCIAL STRATEGY AND SUSTAINABILITY

1 Number of vortals is expected to grow as more local communities indicate larger degree of readiness to support own vortal

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http://www.gateway.kg/

Basic Budget Expenses Year 1 Year 2 Year 3 Total In-kind Total In-kind Total In-kind1 Staff Expenses Permanent Personnel 103 200 28 800 103 200 28 800 103 200 28 800 Travel 1 500 1 500 1 500 Staff training 2 400 2 400 2 400 2 400 2 400 2 400 Subtotal Expenses & In-

kind Contributions 107 100 31 200 107 100 31 200 107 100 31 200

Subtotal Net Expenses 75 900 75 900 75 900

2 Long Term Assets Hardware 16 100 8 500 Furniture 700 700 Subtotal Expenses & In-

kind Contributions 16 800 9 200

Subtotal Net Expenses 7 600

3 Marketing and Outreach Advertising 5 000 5 000 5 000 Promotional Material 3 000 3 000 3 000 Conferences, Workshops,

Presentations 6 400 6 400 6 400

Subtotal Expenses & In-kind Contributions

14 400 14 400 14 400


4 Outsourcing and Consultancy

Content Development 15 000 15 000 15 000 15 000 15 000 15 000 Business Consulting 5 000 5 000 5 000 5 000 5 000 5 000 Translation 1 000 1 000 1 000 Equipment Maintenance 1 200 1 200 1 200 Monitoring and Evaluation 1 000 1 000 1 000 Legal 500 500 500 Audit 1 000 1 000 1 000 Subtotal Expenses & In-

kind Contributions 24 700 20 000 24 700 20 000 24 700 20 000


5 General and Administrative Office Rent & Utilities 2 400 2 400 2 400 2 400 2 400 2 400 Internet Connection (ISP

services) 3 600 3 600 3 600 3 600 3 600 3 600

Server Hosting, Domain 1 200 1 200 1 200 1 200 1 200 1 200

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Registration, Communications (phone,

fax, postage) 960 960 960

Office Supplies 2 400 2 400 2 400 Financial Charges (banking,

forex, interest) 600 700 700

Subtotal Expenses & In-kind Contributions

11 160 7 200 11 260 7 200 11 260 7 200

Subtotal Net Expenses 3 960 4 060 4 060 Total Expenses & In-kind

Contributions 174 160 67 600 157 460 58 400 157 460 58 400

Total Net Expenses 106 560 99 060 99 060 Revenues (Cash) 1 Commercial Revenues 7 000 25 000 40 000 2 Local Contributions &

Grants 5 000 11 000 16 000

3 International Contributions & Grants (excluding DGF)

10 000 15 000 20 000

4 Government Funding 5 000 10 000 Total Revenues (1 + 2 + 3 +

4) 22 000 56 000 86 000

Funding Gap (Total Expenses – Total Revenues)

84 560 43 060 13 060

STAFF EXPENSES

CategoryNo of staff

Monthly gross

salary per staff

member

Year 1 (US$)

Year 2 (US$)

Year 3 (US$)

In-kind contribution

Executive Director

1 90010 800 10 800 10 800 FIA

Project manager

1 8009 600 9 600 9 600

Business plan /Strategy coordinator 1 750 9 000 9 000 9 000 Content coordinator 1 750 9 000 9 000 9 000 Partnership Coordinator 1 750 9 000 9 000 9 000 Technology coordinator 1 750 9 000 9 000 9 000 Programmer 3 400 14 400 14 400 14 400

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System administrator 1 550 6 600 6 600 6 600 ArashanProcurement specialist 1 300 3 600 3 600 3 600 Analyst 1 300 3 600 3 600 3 600 Content-specialist 4 200 9 600 9 600 9 600 Office manager 1 350 4 200 4 200 4 200 FIAAccounant 1 400 4 800 4 800 4 800 FIA

Staff trainning 2 400 2 400 2 400

Company of innovative

technologies, Elite Personnel Agency

Total 18 103 200 103 200 103 200

Long Term Assets

Category Year 1 (US$)

Year 2 (US$)

Year 3 (US$)

In-kind contribution

Personal Computers11 200

E-Development Foundation ($8500)

Web Server 4 000 Power Back Up Supply 600 Printer 300 E-Development FoundationFurniture 700 E-Development FoundationTotal 15 800 0 0

Round-tables, conferences and PR


Year 2 (US$)

Year 3 (US$)

Round-tables 2 400 2 400 2 400Conferences 4 000 4 000 4 000Advertising 5 000 5 000 5 000Flyers 1 000 1 000 1 000Booklets 2 000 2 000 2 000Total 14 400 14 400 14 400

Funding by Programs

Programs Year 1 Year 2 Year 3 Total In-kind Total In-kind Total In-

kind

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1 Content development & subscribtion services

Subtotal Expenses and In-kind Contributions

25 000 4 500 24 000 5 000 24 000 5 000

Subtotal Net Expenses 20 500 19 000 19 000 Subtotal Revenues &

Contributions (other than DGF) 3 000 9 500 22 000

Subtotal Financial Gap 17 500 9 500 (3 000)

2 Portal Development and web-services


34 000 5 000 28 000 6 000 28 000 6 000

Subtotal Net Expenses 29 000 22 000 22 000 Subtotal Revenues &

Contributions (other than DGF) 3 000 16 000 32 000

Subtotal Financial Gap 26 000 6 000 (10000)

3 E-procurement


16 000 3 600 13 000 2 000 13 000 2 000


Subtotal Revenues & Contributions (other than DGF)

7 000 8 000 10 000

Subtotal Financial Gap (Surplus) 5 400 3 000 1 000

4 On-line Labor Exchange


9 500 2 500 6 000 2 000 6 000 2 000



1 000 7 000 5 000

5 On-line researches


11 100 4 000 7 000 2 500 7 000 2 500



1 000 5 000 5 600

6 PR activity


19 500 3 000 16 000 3 000 16 000 3 000



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Subtotal Financial Gap (Surplus) 16 500 13 000 13 000 -

7 Country Gateway organizataion


59 060 45 000 48 660 37 900 48 660 37900



7 000 10 500 11 400

Subtotal Financial Gap (Surplus) 7 060 260 (640) Total Net Expenses 106 560 90 260 84 260

Total Revenues & Contributions (other than DGF) 22 000 56 000 86 000

Total Financial Gap 84 560 34 260 (1 740)

Revenues Forecasts


Year 2 (US$)

Year 3 (US$)

Database subscription 300 1 600 2 000 WAP-content 300 1 000 1 200 Portal Advertising Revenues 900 6 000 8 000 E-procurement Subscriptions 400 3 100 5 000 Web-hosting 1 200 3 600 4 800 Web-design 300 3 000 3 600 Web-promotion 400 900 1 200 ASP services 1 200 2 800 3 600

Polls services (Opinion polls, on-line market surveys) 1 000 3 500 5 600 Labor exchange services 1 000 4 500 5 000 Total 7 000 30 000 40 000

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3. BUSINESS DESCRIPTION

3.1 Development Gateway BackgroundCommunication on the World Wide Web between international organizations, governments, civil society, and private sector has been greatly improved during recent years, however, several key challenges still remain, including low access to reliable sources of information, low co-ordination between development organizations.

To complement and leverage the efforts of many groups within the development community, the World Bank Group launched a collaborative initiative, called “the Development Gateway”.

The Development Gateway is envisioned as a portal website on development issues, from which users will be able to access information, resources, and tools, and into which they will be able to contribute their own knowledge and experience.

Country Gateways will play a critical role in the project and will build and expand national links into the global development community to target specific country needs by providing premier quality information on the particular country. Country Gateways will share common with DG approach to promote global exchange of knowledge, ideas, expertise and opportunities and will be implemented on a standardized IT platform. There will be a rich set of links between Country Gateways and the Development Gateway with information flowing in both directions. The role of the Development Gateway is not to create the knowledge, but simply to make it accessible throughout the world in more efficient and coordinated fashion.

A wide range of information, knowledge and other resources will be made available free, but paid-for service will be permitted as well. It is assumed that revenues generated by Country Gateways will remain modest in the first three to five years of operation and operating costs would thus have to be covered by capital contributions or sponsorship by donors.

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3.2 Kyrgyzstan Development Gateway Project

3.2.1 Background

Kyrgyzstan, being a transition country, suffers economic slowdown, and seriously lags behind the developed countries in terms of IT utilization. Internet penetration rate is some 1% of the population. The digital gap inhibits integration of Kyrgyzstan into the world economy, which results in expanding the development gap.

The core of KgDG program is the creation of a premier Web portal designed to facilitate exchange of development information and CDF implementation2.

KgDG portal adopts overall philosophy, content concept and IT platform of the Development Gateway to empower Kyrgyz development communities online and to bridge digital divide and eradicate poverty.

Within the framework of this grant preparation work has been done to transfer the project into the implementation stage: regular Kyrgyzstan E-readiness and Needs Assessments have been initiated, KgDG portal prototype was built, and partnership building activities were performed for project’s stakeholders.

Receiving powerful backing of the Kyrgyz Republic President’s Administration, KgDG acts as an umbrella organization and catalyst of ICT initiatives, launched in the country. It renders assistance or participates through partnerships/franchise in fulfilling the relevant endeavors rather than implement e-development projects independently.

During the implementation stage the project key tasks will be raising the technology and self-sustainability level of the project, developing e-pilots and conducting off-line outreach activities. After financial sustainability of the project is attained, focus will shift toward elaborating and implementing program of comprehensive e-development of Kyrgyzstan.

3.2.2 Mission

Kyrgyzstan is a small landlocked country in Central Asia, moving along the road of economic and democratic reforms. The problems inhibiting Kyrgyzstan development include scarcity of natural resources, low accessibility of mineral deposits, remoteness from international transportation routes, underdeveloped infrastructure, inadequate amount of investment, and energy dependence on neighboring countries. The mentioned and other factors account for ineffectiveness of economic reform and hinder poverty alleviation in the country.

Implementation of KgDG project is an instrument for Kyrgyzstan comprehensive and holistic development. State-of-the-art information technologies will be utilized to assure attaining the major goal - sustainable development and poverty alleviation. Thus, KgDG mission is to facilitate comprehensive development of Kyrgyzstan on local and national levels through providing access to online information, communication and transaction toolkits and catalyzing implementation of national e-development program.

2 Kyrgyzstan is a pilot country to launch the CDF - initiative that takes a holistic approach to development. It seeks a better balance in policymaking by highlighting the interdependence of all elements of development – social, structural, human, governance, environmental, economic, and financial. It emphasizes partnerships among governments, donors, civil society, the private sector, and other development actors.

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3.2.3 Goals and Objectives

The project mission will be carried out through achieving the following goals:

1. Enhancing institution sustainability of implementing agency2. Enhancing financial sustainability of implementing agency3. Delivering KgDG ICT4D services

To achieve project goals the following tasks are to be addressed:

1. Enhancing institution sustainability of implementing agencyo Increasing number of members of supervisory boardo Expanding partnership network of organization

2. Enhancing financial sustainability of implementing agency

o Promoting paid-for services of KgDG ICT sector ad-hoc marketing research Marketing consulting for ICT companies Evaluation of ICT projects

o Fund-raising KgDG-initiated projects Donors-initiated projects (MSAs)

3. Delivering KgDG ICT4D services

o Leverage the capacity of stakeholders to use the Internet for sharing information and knowledge

o Ensure beneficiaries’ access to development information and knowledge o Deliver consulting services for Kyrgyz policymakers on ICT4D issues o Promote access of disadvantaged groups to knowledge and ICTs for

development o Facilitate national dialogue and emergence of a shared vision for ICT

development

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3.3 Business Model

3.3.1 Implications from 1st implementation year

The 1st year of implementation phase ensured reality-check of initial KgDG business model. Following tight analysis of accomplishments achieved and failures experienced and recommendations from final external evaluation of project3, KgDG PMU decided to cancel delivery of the following paid-for and free-of-charge services:

Paid-for services cancelled:• Newsletters subscription• Banner Exchange Network Services• Posting Banners at KgDG Portal• Web promotion • Banners Design• Site Templates Design

Free-of-charge services cancelled:• Newsletters subscription• Banner Exchange Network Services• Posting Banners at KgDG Portal• Web promotion • Banners Design• Examining and assessing project documentation• Distance learning services• Some of the knowledge databases

The adjusted business model became simpler as well as more stable. Almost all offline services are now paid-for, while all online services are free-of-charge.

3.3.1 Socially oriented services

News subscription

Free weekly newsletters in English and Russian with customization features are being forms of KgDG portal news and updates of thematic sections of KgDG portal. Newsletters are available via subscription. Currently there are some 270 subscribers of newsletters.

Knowledge database subscription

Content for databases posted on KgDG portal will be generated by KgDG content partners. The role of content group of the project will be confined to provision of tools for decentralized and distributed content administration and to monitoring observance of editorial policy. Access to all databases created on Portal will be free.

Cited below is the list of databases that have already been initiated by the project partners4.

3 See KgDG Final Evaluation Report4 Database list will grow as partnership network expands.

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Database title as for KgDG

Implementation grant proposal

Affiliation with specific KgDG vortal

Brief description # of entries

Directory of Kyrgyz vendors, products and services

Business Development vortal

Brief description of Kyrgyzstan’s vendors, their products and pricing policies

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ICT Market Database ICT web-site Comprehensive information on the national ICT market (statistics, information infrastructure data, main players, trends, analysis of competitive environment, legislation, investment opportunities etc.).

N/A

Databases of public agencies on central and regional levels

E-Government vortal

Brief description of the public agency, information about senior officials, postal address and contact info of the agency

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Database on investment opportunities

Investment promotion vortal

Description of investment seekers, business description, amount of investments needed, other important comments

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Database of investors and international agencies engaged into investment promotion


Information on organization address, name of director, telephone and fax number.

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Database of funding opportunities

NGO vortal Contact information, data on program areas, eligibility criteria, amount and type of assistance of specific donors

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Database of Kyrgyz NGOs

NGO vortal Information on NGO’s business, projects implemented, beneficiaries, address

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Forum. During planning phase KgDG team got experience of arranging national forum to discuss and facilitate elaboration of CDF program and issues concerning development of ICT. Forum was further improved during Implementation Stage with almost 1.5 thousand postings as of late April 2003.

Web-development services

KgDG portal software package allows users with minimum PC and Internet skill creating their own web-sites. In case new site is created within KgDG portal taxonomy, access to package will be free of charge. 30 Mb of free hosting space will be provided for all beneficiaries of this service after signing the special agreement.

All web-resources developed within KgDG will enjoy advertisement support. For this purpose KgDG will provide advertisement space of top-hit sections of KgDG vortal and ensure automatic registration with some 300 leading global, regional and national search engines and catalogues of links,

Structure of ICT4D services of KgDG may be presented as follows:

5 the number indicates quantity of vendors-related entries

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Supply-side services

Web-development services Advertisement support

Demand-side services

KgDG portal Information services

KgDG portal Communication services

KgDG portal as facilitator and concentrator

Drawing up recommendations on national ICT policy and e-development pilots. This refers to a wide range of ICT-for-development programs, which can be classified in the following way:

- Concepts of industry-specific ICT programs – papers delineating necessity, benefits and possible ways of integrating ICT into strategic industries of Kyrgyz economy (agriculture, tourism, transportation, ore mining and processing sector, hydroelectric-power sector).

- National ICT policy recommendations – concepts describing strategic vision and approaches to develop Kyrgyz information infrastructure, legislative base both on national regional and local levels etc.

This will be done in close cooperation with key government counterparts (President’s Administration, Council of FDI promotion under the President and Ministry of Transport and Communication) to ensure further application of concepts by policymakers and attraction of necessary funds to implement respective e-pilots. Recommendations will be prepared on a quarterly basis.

Outputs produced within this program in 2001-2003 by KgDG specialists include preparation of Kyrgyzstan ICT development strategy (2001-2002) and draft ICT Action Plan (2002-2003).

3.3.2 Paid-for commercial services

ICT Sector ad-hoc marketing research

During the Planning Stage the project team has established partnerships with the majority of local ICT experts and established marketing research agencies. During implementation stage these contacts were used by KgDG and its business development partners implemented several market research projects for Kyrgyz telcos .

Division of functions between KgDG and its business development projects are as follows:• KgDG is charged with methodological design of the project and performing analytical

activities

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• Partners are charged with organization of sales, negotiations with clients, conducting fieldwork and possible on post-project consultations.

Such scheme allows avoiding recruiting of high number of supportive and technical staff needed for fulfillment of entire cycle of research and consulting activities.

The offered package contains a full range of services, from designing research program to reporting. Spectrum of research methods used includes:

Quantitative Research a. Face-to face interviewsb. ICT experts surveysc. Panel surveys

Qualitative Research a. Group discussions / focus-groups; b. In-depth interviewsc. Content-analysis

Desk research a. Analytical reviews of Kyrgyz and Central Asian ICT-related markets

Experimental researcha. Mystery shoppingb. Hall-tests

List of clients includes Kyrgyz mobile operators (BITEL GSM), fixed telephony operators (KyrgyzTelecom), ISPs (Elcat ISP, Transfer ISP). Negotiations are underway with Samsung Electronics Inc, Serome Inc.

Marketing consulting for ICT companies

Possible marketing consulting areas would include, but not limited to:

• Revision and preparation of recommendations for streamlining system of gathering market information

• Revision and preparation of recommendations for streamlining sales system of the company• Revision and preparation of recommendations for streamlining advertising strategy and plan • Segmentation and evaluation of various market segment, niches and company’s share • Revision and preparation of recommendations for streamlining pricing policies• Competitive positioning analysis

ICT projects management

KgDG will get funding from donors to implement offshoot projects that meet its objectives. Examples include community development e-projects (training, health, social) and e-business development. KgDG will charge 15% of the total cost of such projects as grant administration fee.

KgDG has already forged strategic alliances with several local stakeholders to jointly apply for donor-funded projects. In some cases stakeholder acts as grant recipient, while KgDG acts as a counterpart of the applicant and implements large portion of project activities. Such approach is beneficial, since many donors perceive KgDG as World Bank’s initiative with enormous financial support from its ‘founder’.

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Another option is to sign Management Service Agreements, as contracts, made at the request of the government, for KgDG to carry out a donor project which has already been bilaterally funded. With an MSA, the donor retains full authority, accountability, and ultimate responsibility for the activity which KgDG has been contracted to perform.

During the 1st year of implementation stage KgDG managed to form a minimum portfolio of projects implemented for international donors, they include:

• Kyrgyzstan ICT Infrastructure and E-Readiness Assessment (InfoDev)• Research and practical application m-commerce solutions in agriculture sector of

Kyrgyzstan and Central Asia (IDRC’s PanAsia R&D program)

Evaluation of ICT Projects

KgDG experts will evaluate respective ICT project in terms of effectivity, efficiency, policy relevancy, cost-benefit viewpoint and impact on end-users. Evaluation levels will include:

• Organizational analysis • Program Analysis • Contextual Analysis

KgDG will apply complete scope set of data collection and procession methods, utilizing technical and human resources of its business development partners, while core analytical&consulting services will be rendered by KgDG.

Expanding opportunities of disadvantaged groups to access ICT – the Project will go on working with donor organizations to involve disadvantaged groups in using knowledge for development. During Implementation Stage KgDG team’s efforts will be concentrated at creating a network of telecenters based on infrastructure of the State Computerized Network. In order to develop the network KgDG PMU actively cooperates with Presidential Administration, UNDP and the World Bank. For this purpose in May 2002 KgDG PMU held a series of meetings with Jit Gill, Lead Public Sector Management Specialist for Europe and Central Asia Region at the World Bank, and Konstantin Atanesyan, E-government consultant, the World Bank. The above WB specialists were engaged into preparation of terms of structural adjustment credit for reforming Kyrgyzstan’s public administration sector. KgDG provided them with comprehensive findings from KgDG research on e-government, informatization of community, and regional connectivity issues.

Since June 2003, within GSAС agreement, creation of the first WB-funded public access center will be launched. KgDG specialists are expected to participate in GSAC activities as local consultants.

Rent of package of site building tools

Unlike the web-development services described above, which provide the client with direct access to ready-made platform or service, this one is peculiar for providing the client with a chance to develop own web-sites independently. Technical and informational maintenance is performed by the buyer himself. Such paid-for option is basically targeted at corporate clients and international agencies.

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4. INTERNET MARKET ANALYSIS6

4.1 Country Overview

The Kyrgyz Republic is a small, mountainous, and land-locked Central Asian country of 200,000 square kilometers with population of 4.92 million. Border countries include China, Kazakhstan, Tajikistan and Uzbekistan.

With per capita GDP of US$326, over 50 percent of the population lived below the official poverty line in 2002, and 13 percent could not afford even the poverty-line food basket.

Following independence, the government liberalized most prices, created a national currency, introduced a liberal trade regime, and eliminated most capital controls. The monetary and fiscal policy framework and instruments were overhauled, in parallel with reform of the financial sector. Non-tariff barriers have been removed and export taxes have been eliminated on all goods. In November 1998, the Kyrgyz Republic became the 133rd-and first Commonwealth of Independent States (CIS)-member of the World Trade Organization.

KEY ECONOMIC INDICATORS1999 2000 2001 2002

GDP at market prices (current US$) 1.3 billion 1.365 billion

1.412 billion

1.488 billion

GDP growth (annual %) 3.7 5.0 5.3 -0.5GDP per capita (US$) 300 270 280 294Inflation rate (CPI): 37% 18,7% 6.9% 2.1%

Present value of debt (current US$) 1647.4 1704.5 1553.2 1586.2Present value of debt (% of GDP) 136.6 131.1 110 106.6

Structure of economy (% of GDP)Agriculture 43.9 44.1 45.0 44.5

Industry 19.5 19.6 19.4 19.5Services 36.6 33.3 35.6 36.0

TradeOverall budget deficit (% of GDP) -2.5% -2% -1.7% -3.2%

Exchange rate (USD/KGS) 38,96 47,71 48.03 46.22

4.2 Information Infrastructure Survey

Kyrgyzstan's largest telecommunication service provider is the JSC KyrgyzTelecom, which is the national communication operator. It holds an exclusive license for long-distance and international communication service delivery till 2003. As of February 2003, the total capacity of the JSC “KyrgyzTelecom” was 512,500 lines, 35% (national average) of telephone lines are digital. The national teledensity rate is 10,25 lines per 100 persons. This represents a teledensity of 29 percent in the capital and only 8 percent in the rest of the country.

6 All data in this chapter is taken from Kyrgyzstan E-readiness and Needs Assessment Reports, Kyrgyzstan Development Gateway project, 2001

20

The government has planned to privatize the company. As per the privatization bids terms, an investor upon purchasing 40% of company’s stock should increase the total capacity by 500,000 lines.

The significant portion of the republic's transport networks is based on digital radio-relay connections. This type of signal transmission is used since it fits the Kyrgyz Republic with mountainous landscape, and enables building information highways virtually to everywhere within its territory. The backbone telecommunication facility is build upon SDH (155 Mbps) equipment.

Fiber-optic cables have been laid to establish separate sections of the transport network in the following regions of Kyrgyzstan: Northern Kyrgyzstan (200 km); Southern Kyrgyzstan (200 km), capital Bishkek (45 km).

Kyrgyzstan is involved in the TAE (Trans Asia Europe) construction project. The TAE capacity is 7,680 channels (622 Mbit/second). Total TAE length in Kyrgyzstan is 185 km. The ТАЕ will connect Shanghai (China) and Frankfurt (Germany), passing through Poland, Turkey, Iran, Kyrgyzstan, Uzbekistan, and Kazakhstan.

Integration into international communication networks is provided through satellite systems: two IBS F1-standard stations operating via TURKSAT satellites and Express-6 satellite and one A-standard satellite communication station whose parabolic antenna is directed towards the Intelsat system satellite. In addition to the existing systems, the international SilkSat satellite communication system, which uses two low-orbit satellite located above the Ukraine and Kyrgyzstan, is under development.

There are two cellular communication providers working on standards D-AMPS и GSM. As of January 2003, the number of users of cellular communication was around 74 thousand, which equals to 1.48% of the population. The mobile communication stations cover somewhat 10% of the country’s territory, which is a good indicator given the Kyrgyz landscape, where over 90% of the territory is mountainous.

4.3 Internet Availability and Affordability

As of the beginning of 2003 the republic numbered 16 ISPs for 5.011 million inhabitants, making it 1 ISPs for 370 thousand people. Total modem pool of ISPs amounts to 2000 modems. The speed for the modem connection varies from 2.4 kbps to 56 kbps depending on the type of modem and the quality of the user's telephone line. Dedicated lines with transfer speeds up to 2 Mbps are available and cost from $150 to $10,000 per month depending on the speed.

The most recent innovation in the Internet market of Kyrgyzstan was the launch of high speed access to the Internet over existing telephone lines. xDSL technologies-based Internet providing was started by two leading ISPs in Bishkek. The new service is being provided at considerably low prices: ADSL access cost from $50 per month.

The Internet development over the recent years is indicated by increase in total bandwidth of international network channel. While in 1998 the total ISPs’ channel was estimated 768 Kbps, by 2003 the cumulative channel capacity has increased sixteen times up to 15 Mbps. 70-90% of domestic telephone calls are successful.

Starting 1998, competition in the Internet access market has dramatically grown, thus entailing drop in tariffs and growth in service quality.

21

Tariffs for Internet access services and Internet accessibility

As compared with 1994 per hour tariff has decreased 10 times; the cost of unlimited access has dropped from $120 (1998) to $36 (2002). However Kyrgyzstan's average salary reduced twofold over the same period; therefore Internet affordability7 has grown 2.7 times over the last five years. In mid 2001 a person with average salary could afford 27 hours of Internet access a month.

In late 2000, in Kyrgyzstan 9.8% of users and 34.2% of companies could not afford using the Internet more frequently mainly due to high tariffs. In such a situation, the number of potential users grows due to the Internet access and training opportunities provided by universities and international organizations. Overall number of telecenters across the country enumerated 56 units as of the beginning of 2001.

Cybercafes exist in all cities/towns of the republic. As of November 2003 their number was more than 70 in Bishkek, thus having increased by 600% as compared with the same period of 2001. Prices for Internet access range from 0,33 $US/ per hour or from 1 $US per whole night. Cybercafes have become prevailing places of Internet access for 32.8% of users. In addition 18% of users use the Internet at home and 49.2% at office or at educational institutions.

Individuals own slightly less than 50% of the republic’s computer stock (which is about 70 thousand units). Internet penetration rate among home computers is some 66.7%. Average national PC penetration rate was around 1,047-1,151 in late 2002.

4.4 Kyrgyzstan Online PopulationFor more precise characteristics the Internet user audience has been segmented into several groups.

Growth of Kyrgyzstan’s Core Internet Audience 8

600 25008000

28000

52000

74000

96000

Num

ber

of In

tern

et u

sers

1994 1996 1998 1999 2000 2001 2002

BREAKDOWN OF INTERNET USERS BY CATEGORIES

Gender structure Regional breakdown Age structure Household monthly income

7 Indicated as a number of hours of Internet connection which can be purchased by Internet user with average salary8 ‘Core Internet audience’ denotes number of Internet users who spend more than 3 hours a week for the Internet. Source: Kyrgyzstan Internet Audience Research. Kyrgyzstan Development Gateway and Foundation for Information Assistance, Bishkek, 2002

1994 1996 1998 1999 2000 2001 2002No. of ISPs 2 2 4 7 9 11 16Total bandwidth of international network channel (Kbps)

32 128 768 1960 4096 6000 15000

Subscription cost for unlimited access N/A N/A 120$ 80$ 45$ 40$ 36$Per hour access fee, $/hour 5 2,5 2 1,5 0,9 0.7 0.5

22

Male 60.6% Bishkek city 80% 14-20 33,4% Less than 40$ 13,1%Female 39.4% Other towns 20% 21-30 42,4% 40$ - 80$ 21,5%

Rural areas 0,0%

31-40 14,9% 80$ - 120$ 14,9%41-50 7,5% 120$ - 160$ 3,6%

50+ 1,8%

160$ - 200$ 4,2%More than 200$ 10,1%

Failed to calculate 23,9%

Refused to answer 8,7%

It is noticeable that in the 2 years of Internet monitoring, gender gap of Internet users has gone down: for instance if male share of Internet users was equal to 67% in 2000, in 2002 it went down to 60,6%.

In terms of age characteristics, Internet audience keeps growing younger: only 21,5% of Internet users were under 20 in the fall of 2001(increased by 11,9%), and 11,53% were over 40(decreased by 2,2%).

Internet Audience. Occupation breakdown

Private

sector; 25,7

Government

sector; 20NGOs; 2,4

Academia

and

unversities;

31,3

Pre-

university

schools; 10,1

Others; 10,5

A full-scale research of the Internet corporate sector in Kyrgyzstan has not been undertaken so far. In 2002 KgDG and its business development partner conducted survey of managerial staff of Kyrgyz legal entities9.

According to the assessments from survey, in networked organizations on average 6 people has access to the web. Purposes, for which they use Internet are outlined below:

Purposes of using Internet by employees of private companies

IP telephony

E-mail Posting announcements and

advertisements

Communication (forums and

chats)

Search of business-related

dataHigh importance 10,7 90,0 18,3 28,1 43,5

Medium importance 21,5 7,5 30,8 34,7 34,8

Low importance 67,8 2,5 50,8 37,2 4,7

Source: Findings from Kyrgyzstan Internet Audience Research 2002, Foundation for Information Assistance, Kyrgyzstan Development Gateway, Bishkek, 2002

Thematic breakdown of information, that is subject to search in Internet

News Entertainment Science and education

Business and

Job, migration

Tourism and travel

Information about goods

9 NGOs, academic sector and private enterprises

23

finance and services74,2 26,4 47,1 41,3 9,1 12,4 41,3

Source: Findings from Kyrgyzstan Internet Audience Research 2002, Foundation for Information Assistance, Kyrgyzstan Development Gateway, Bishkek, 2002

The growing number of sites also indicates intensive development of Internet. Total number of top-level domain names registered as of mid 2002 accounts for 950 units. Only 190 of them were registered by residents of Kyrgyzstan, while non-residents registered 760 names. Number of second-level domain names registered by ISPs equaled some 35 000 units.10

Major Internet resources can be qualified as information-oriented resources, since use of communication services is very limited. Forums and chats can be found on 5%-7% out of the total number of web-sites.

Overwhelming majority of web-sites support Russian version. Kyrgyz versions can only be found at less than 1% of operational web-sites.

Structure of main array of web-resources of Kyrgyz Internet segment11

Educational institutions’ web-

sites

Government web-sites

NGOs web-sites

Corporate web-sites

Service web-sites

Personal pages

News and mass-media web-sites

Others12

6,1% 3,2% 6,7% 26,2% 15,7% 13,7% 12,0% 16,4%

Source: based on www.top.kg statistics analysis.

3,0% of Internet users never visited local Internet-resources. Reasons behind such behavior are pointed in the table below

Deficiencies on Kyrgyz Web-resources: users’ viewpoint

Individual users Corporate users13

Static character of content 19,5 38,8Content is not interesting 18,7 27,3Low downloading speed 18,5 24,8Poor design 17,4 19,0Lack of analytical data 13,5 20,7Lack of data in Kyrgyz language 6,7 9,9

Source: Findings from Kyrgyzstan Internet Audience Research 2002, Foundation for Information Assistance, Bishkek, 2002

4.6 E-governmentAs of July 2002 31 state organization (58% out of the total number) developed own web-sites, only 16% out of them regularly deliver online information services (publication of official news and legislation acts). Only 1% out of the total number of services, rendered by the state organizations, is delivered online14.

Survey of state web-sites15

SURVEY OF ALL STATE ORGANIZATIONS’ WEB-SITES

10 Data of Communication Operators Association, Bishkek, August 2002.11 Calculated based on observation of sampled population of Web-sites, registered in www.top.kg statistics system. The sample encompassed main array of web-resources – 20% of web-sites with the highest visit rates were observed (sampled web-sites accounted for more than 80% of visits in .kg zone).12 This includes web-sites, which did not fell into any of the previous groups, they, as a rule, are web-sites with specific strictly thematic information t: sport, music, hobbies etc.13 In this case opinion of the surveyed organizations is concerned.14 Data from Draft concept note on E-government development in the Kyrgyz Republic, Bishkek, August 2002.15 The survey was conducted on August 24-26, 2002 by KgDG experts

24

http://www.top.kg/

Total Operational at the moment of survey

Site map, navigation tools

Frequency of updating Links to other state sites

Feedback Е-Mail Forum Downloadable forms

English Version

31 27 95,5% Daily 16,1Weekly 19,4Monthly 9,7

Quarterly 22,6Not updated 32,3

22,6% 25,8% 67.7%

19.4%

22.6% 51.6%

SURVEY OF EXECUTIVE BODIES’ SITESTotal Operational

at the moment of survey


Frequency of updating Links to other state sites

Feedback

Е-Mail Forum Downloadable forms

English Version

29 25 62,1% Daily 16,1Weekly 19,4Monthly 9,7

Quarterly 22,6Not updated 25,8

24,1% 24,1% 65,5%

17,2% 24,1% 55,2%

SURVEY OF LEGISLATIVE BODIES’ SITESTotal Operational

at the moment of survey


Frequency of updating

Links to other state sites

Feedback Е-Mail

Forum Downloadable forms

English Version

1 Parliament Yes Not updated No No Yes Yes No No

SURVEY OF JUDICIAL AUTHORITIES’ SITESTotal Operational at

the moment of survey


Frequency of updating

Links to other state sites

Feedback Е-Mail

Forum Downloadable forms

English Version

1 Supreme Arbitration Tribunal

Yes Not updated No Yes Yes No No No

Only 19,4% of web-sites were built on DBMS. None of the surveyed sites contained private policy and/or security policy statement in any form.

Two Public Access Centers were created in the National Library in Bishkek (10 computers) and in the Regional Library in Osh (10 computers) and were connected to SCN to provide broad public access to government online content and services.

4.7 Legal environmentThere is no specific legal basis for Internet in Kyrgyzstan.

The Kyrgyz Republic's laws do not fix legal status of domain names. Asia-Info, one of Kyrgyzstan's leading ISPs, is engaged in distributing and registering domain names. The ISP takes fees for domain name registration.

Validity of electronic signature is another issue, which has not been resolved yet. Currently only physical signatures are legally valid. Albeit Kyrgyzstan has adopted the Law On Electronic Payments that institutes digital signature, the scope of its application is confined to banking operations. Use of digital signature for signing contract is impossible.

A key issue is the absence of law on Internet status. It remains unclear if Internet is a mass medium and is subject to The Mass Media Law or it belongs to telecommunications.

25

There is no legal basis for computer crimes determination and no procedure for crime prevention in this field.

In June 2001, the Council on Informatization was established in Kyrgyzstan, chaired by the President. The Council is to draft Kyrgyzstan strategy for ICT development. KgDG project manager is a member of working group on development of IT strategy.

Summary information about ICT-related legislation regulations is presented below.

Date of adoption Title of the documentMarch 10, 2002 Presidential decree on National Strategy of Information and Communications

Technologies Development in the Kyrgyz RepublicNovember 8, 2001 Presidential decree on program on the Development of the Information and

Communications Technologies in the Kyrgyz RepublicJuly 23, 2001 Regulations on Administration of the State Computer NetworkJune 18, 2001 Presidential decree on the Council of information and communications

technologies under the President of the Kyrgyz RepublicJuly 6, 2001 Presidential decree on the State Agency for CommunicationsApril 2, 1996 Law on Standardization April 2, 1996 Law on Certification of goods and servicesOctober 8, 1999 Law on InformatizationApril 24, 1998 Presidential decree on the State Committee on Radio Frequencies Committee March 6, 1998 Law on electric and postal communicationOctober 7, 1997 Presidential decree on the National Agency for Communications

Source: International Finance Corporation, Study on ICT Business Environment in the Kyrgyz Republic, Version 1.0, Gunnulf Martenson, June 26, 2002, www.adviser.kg materials

26

http://www.adviser.kg/

4.8 Target Market Characteristics and Needs16

We envisage that KgDG services will be customized for a variety of groups:

• Policymakers/government officials• Businesses• NGOs• International and Donor Organizations• Individuals

The goals of beneficiaries associated with projects similar to KgDG can be classified as Knowledge, Exploitation, Network and Strategic Management goals, which can be structure like this:

Knowledge goals. These are goals of a technical nature concerned with the expansion and consolidation of know-how and knowledge bases. Examples of services rendered to address these goals KgDG business planning or ICT market research services.

Exploitation goals. Some goals have a strategic or commercial orientation and are more concerned than others with the eventual exploitation of knowledge and skill bases. Examples of services rendered to address these goals include KgDG databases and on-line forums development.

Network goals. These relate to network formation and the establishment of new links and partnerships. They have a structural or systemic nature in that they invariably refer to the relationship between an organization and its environment. Examples include KgDG partnership promotion activities.

Strategic Management goals. Goals such as ‘raise additional funds’, and ‘spread risks’ reflect a combination of opportunistic, economical and parsimonious practices characteristic of sound R&D management and stewardship

Across all KgDG beneficiaries17 the most important goal was access to web development solutions and enhanced image and reputation, followed by access to complementary sources of expertise and formation of partnership networks. Several respondents also stated enhancement of existing knowledge base.

The hierarchy of goals is completely in line with KgDG philosophy, where there is a focus both on outputs and on the processes which achieve those outputs.

There are some differences in motivation across various types of participants. NGOs were keen to explore new technology solutions – which would lead to an expansion of partnership networks and enhanced image and reputation. This is a core activity for this type of institution which is concerned with hunting funding from donor agencies.

The public sector wished to achieve some form of prototype or pilot activity (e.g. e-government vortal or investment-seekers database). This will help to achieve the second most important goal, which is raising additional funds (since 95% of ICT-related activities in Kyrgyzstan’s public sector are funded using foreign grants and loans).

IT Industry was very keen to access to complementary sources of expertise and enhancement of existing knowledge base. This desire is perfectly natural amongst Kyrgyz companies, since the industry is in stage of rapid growth and many businesses lacked the necessary capabilities themselves to undertake ICT research projects.

This was confirmed by representatives of Ministry of Transport and Communication, stating that KgDG experts managed to assist policymakers in such sophisticated projects as ICT Action Plan preparation, which required multi-disciplinary methodology and a multi-institutional approach.

16 This chapter is based on findings from KgDG Final Evaluation Report, Kyrgyzstan, Bishkek, 200317 76 beneficiaries surveyed within evaluation process

27

As for needs for online services, rendered by KgDG, one may structure them analyzing traffic to KgDG web-resources.

Vortal breakdown of consolidated KgDG traffic in March 2003 18

eng.gateway.kg

13%

www.gov.kg35%

http://ngo.gateway.kg

1%

http://business.gateway.kg

2%

http://price.gateway.kg

4%

http://inv est.gatew a

y .kg

8%

www.gateway.kg37%

18 KgDG Final Evaluation Report, Kyrgyzstan, Bishkek, 2003

28

5. COMPETITION

5.1 ICT Market Research/Consulting19

Key players on research&consulting market of Kyrgyzstan are analyzed below20.

SIAR-Bishkek LLC

Specialization: full spectrum of marketing research services.Key clients: Coca-Cola Bishkek Bottlers, Reemstma-Germany, Phillips-Turkey, Procter & Gamble –TurkeyStrengths: Subsidiary of AC Nielsen, strong professional ties with developed markets’ playersWeaknesses: no-ICT related experienceCooperation status: competitive company

M-Vector LLC

Specialization: full spectrum of marketing research services.Key clients: Reemstma-Kyrgyzstan, World Bank, DANIDA, USAID, Bitel GSM Strengths: IT-related experienceWeaknesses: weak external professional tiesCooperation status: Competitive company

MNT Consulting LLC

Specialization: IT Consultancy (CRM, ERP, OLAP) and outsourced software development Key clients: Asian Development Bank, European Commission, World Bank, DFiD, SchlumbergerSema (BEL), Muraspec - Manufacturer (UK), Architectural Practice (UK) Strengths: Western business development partnersWeaknesses: no ICT-related marketing research experience, no experience with local IT companiesCooperation status: Competitive company

Expert Consulting Agency

Specialization: Full spectrum of marketing&management consulting servicesKey ICT clients: BITEL GSM, KyrgyzTelecom LLC, Elcat ISP, Samsung Electronics, Serome IncStrengths: IT-related experience, strong professional ties across CIS and CA regions.Weaknesses: Excessive orientation at private sector resulted in insufficient brand awareness level among key ICT4D donors and policymakersCooperation status: KgDG business development partner

Foundation for Information Assistance

Specialization: ICT-related fundraisingKey ICT clients: UNDP, IDRC, World Bank, IREX, Soros FoundationStrengths: Significant grant experience record.Weaknesses: Clientele is confided to donor agencies.

19Information is strictly confidential. Any circulation beyond KgDG or DGF is prohibited20 The analysis only covers companies, with more-than-100KUSD portfolio of projects in FY 2002.

29

Cooperation status: KgDG business development partner

Total volume of ICT market research/consulting projects in FY 2002 was some 200-250 thousand US$21. Share of KgDG and its business development partners was about 40%-50% in 2002.

5.2 Portals segmentAccording to the Gartner Group, four level of portals can be found on the Internet: Internet Entry Point – a non-sophisticated front page with scarce and non-integrated information and links; Content Integration – a more organized content page; Workplace Integration – a portal with diverse functionalities (resource management, search engine, chats, emails etc) and Marketplace Integration Portal, which is the most complex and sophisticated type and which includes virtually all the functionalities made available by the Internet.

As of June 2001 there was neither Marketplace Integration, nor Workplace Integration Portals in Kyrgyzstan, but a few Content Integration Portals www.kyrgyzinvest.org 22 , www.gateway.kg and www.times.kg. It is expected that www.gateway.kg portal will become the first Workplace Integration Portal.

Strengths of www.gateway.kg are: extensive databases on Kyrgyzstan, a well-known forum, and high-quality bilingual content. The portal encompasses several vertical thematic platforms on NGO, business development, public administration and FDI promotion topics.

Scope: Kyrgyzstan, then CIS, then InternationalVisits: Consolidated portal’s daily traffic was about 1000 visits in April 2003 with various thematic web-resources ranked from 13th to 35th in national web-site rating system www.top.kg).Drawbacks: Low degree of cross-platform content and technology integration23.

Kyrgyzstan Internet Audience Research gives a notion about KgDG portal’s global competitors. Within the framework of this research respondents were asked to name three portals they visit most frequently:24

Most frequently visited Share of respondentswww.rambler.ru 30.1%www.yandex.ru 18.5www. yahoo.com 17.6%www.aport.ru 3.8%

5.3 News Sites. Knowledge Database www.times.kg Official site of Times of Central Asia newspaper, currently the most popular information site in Kyrnet. Company’s own off-line business guarantees high-quality content. The site strategy is oriented at creating a regional information site reporting of events in Kyrgyzstan, Kazakhstan, Uzbekistan, Turkmenistan, and Tajikistan. The site is originally

21 Expert assessment of KgDG Strategy/Business Development Coordinator22 www.kyrgyzinvest.org portal was created by KgDG team in 1999 as Private Enterprise Support Project component 23 For more details please see chapter on Technology.24 Findings from Kyrgyzstan Internet Audience Research 2002, Foundation for Information Assistance, Kyrgyzstan Development Gateway, Bishkek, 2002

30

http://www.times.kg./

http://www.aport.ru/

http://www.rambler.ru/

http://www.yandex.ru/

http://r/

http://www.top.kg/


http://www.times.kg/


http://www.kyrgyzinvest.org/

intended for expat community, as it has no Russian version. Therefore the site can hardly be classified as a national portal. Free newsletter subscription and site archive search engine are available. High traffic allows the site to arrange online public polls. Some customization features are present.

The site is among few local online content providers. Online subscription for regular news materials costs from $15 to $12,5 a month depending on duration.

Posting ad banners at front page is also available and costs from 15$ US to 20$ US.

Scope: International, Regional and then KyrgyzstanVisits: daily traffic was about 700-800 visits in April 2003 (Top-10 in TOP.KG)Cooperation Status: Competitive web-resource.

www.kabar.gov.kg is the site of the Kyrgyz National News Agency.

The most comprehensive and dynamically updated information about Kyrgyzstan in Kyrgyz, Russian and English. The drawback of the site is purely pro-governmental nature of information.

Scope: International, then KyrgyzstanVisits: daily traffic was about 400-400 visits in April 2003 (Top-20 in TOP.KG)Cooperation Status: Competitive web-resource.

www.akipress.org/ . Just like www.times.kg the given site is bolstered by AKIpress magazine's off-line publishing business. Bilingual content includes free news and paid-for analytical materials. # of subscribers for paid-for resources is low (up to 50). The site has forum, news archive and document search engine within the site.

Scope: Regional, then international, then Kyrgyzstan.Visits: daily traffic was about 700-800 visits in April 2003 (Top-10 in TOP.KG)Cooperation Status: Competitive web-resource.

The market influence of several web-resources, which had been analyzed in the former version of business plan reduced greatly. For this reason they were not covered in the chapter25.

5.4 Online database segmentThe only competitive database is

www.smetradecenter.net . The project is considered as competitor for KgDG database of Kyrgyz vendors, products and services. The database development is funded by USAID's Enterprise Development Project in Central Asia, implemented by The Pragma Corporation. The resource intends to enhance trade opportunities both within Central Asia and between Central Asia and other parts of the world, through the wide use of an e-commerce website facility.

Scope: Regional, then international, then Kyrgyzstan.Visits: daily traffic was about 300-400 visits in April 2003 (Top-10 in TOP.KG)Cooperation Status: Competitive web-resource.

There are, certainly, other online databases, but their thematic specialization is different from databases, which KgDG develops.25 Namely www.dialog.kg , www.kind.net.kg .

31

http://www.smetradecenter.net/

http://www.kind.net.kg/

http://www.dialog.kg/

http://www.times.kg/

http://www.akipress.org/

http://www.kabar.gov.kg/

5.5 Communication serviceswww.akipress.kg , www.kyrgyzinvest.org site forums can be regarded as competitive communication services.

5.6 Hosting/Posting

Hosting - Site hosting has so far only been provided by ISPs who delivered these services to their clients. IPS’ hosting services are conditionally free as clients are charged a fee when size of their sites exceeds the certain limit.

Banner advertisement – there are 2 commercial banner networks in Kyrgyzstan. Some 1.5 – 2 percent of sites independently sell the space for banner ads. Total volume of online ad services in early 2003 was about 2000$ per month.

On demand site there are about 200 online projects (~20% penetration rate) and about 50 offline ventures (~0,7% penetration rate), utilizing banner ads.

Web-site development and content administration services - until recently to develop web site services skilled specialists or services of web design agencies were needed. The software developed within the framework of KgDG project enables creating and supporting web sites for free and without special technical skills. However, there several Russian competitors, such as www., which, however, have severe hosting and functional limitations,

32


http://www.akipress.kg/

6. PROMOTION26

6.1 Promotion Schedule

The promotion campaign target groups have been identified using the data contained in KgDG E-readiness and Needs Assessment Report, Monitoring Kyrgyzstan Internet Market Report, and Kyrgyzstan Internet Audience Report.

Concrete promotion plan is to be developed right before applying for 2nd round of DGF implementation funding. Promotion plan shall include description of specific activities for promotion of KgDG portal and KgDG organization.

6.2 Promotion Campaign Stages

The marketing plan can conventionally be divided into three stages each of which has its own purposes and objectives.

The first stage, devoted to KgDG presentation and identification was started in June 2001 and was completed in April 2003.

Main objectives of this stage included: (1) identifying target groups and their needs regarding information content and online services, (3) assessing financial capacity of target market segments, (4) identifying key partners for implementation of different project activities and services.

Final external evaluation of project documented high degree of attainment of the above promotion objectives. The latter was ensured through:

1) Conferences and workshops for different local stakeholders: private businesses. NGOs, governmental bodies, and international organizations (total of 26 workshops, roundtables and conferences);

2) Reports on Kyrgyzstan Development Gateway Project in the mass media: newspapers (29 articles) and TV (17 reports)

3) Broad distribution of Kyrgyzstan Development Gateway presentation materials (flyers, folders, posters).

The first stage of the promotion campaign worth almost $9,000 was funded through Infodev planning and implementation grants.

6.2.2 Building Brand Awareness

This stage was partly implemented within the 1st implementation year. The evidence for brand awareness campaign is testified by increasingly growing traffic of KgDG.

Growth of consolidated daily traffic of KgDG web-resources

26 This section covers promotion of KgDG portal only, since promotion of KgDG paid-for services is outsourced to KgDG business development partners.

33

0100200300400500600700800900

1000

June

200

1

Septe

mbe

r 200

1

Decem

ber 2

001

Mar

ch 2

002

June

200

2

Septe

mbe

r 200

2

Mar

ch 2

003

Web-server logs’ analysis demonstrates persistently high share of new visitors. This let us continue brad awareness building activities to utilize the potential of target groups to larger extent.Objectives of the second stage are as follows:

- Providing high degree of awareness about the portal brand, mission and objectives- Providing high degree of awareness about services delivered within portal- Informing key information suppliers about basic advantages of cooperation with the

portal

In order to attain these purposes advertisement campaigns will be regularly arranged to draw audience's attention and to make the brand “Kyrgyzstan Development Gateway” continuously presenting in offline and online media.

Clients have been divided into two major categories: external (international community) and internal (domestic community). To attract foreign clients, English content oriented at foreign audience is composed in KgDG portal, presenting versatile Kyrgyzstan presentation; information for businesses, donors and other groups. To promote KgDG portal along this direction the World Bank information resources will be utilized and the portal will be registered with the global, regional and national search engines and catalogues.

During the second stage the portal will be positioned as multi-functional resource. Domestic users will be focused at the portal's competitive advantages: (1) one-stop-shop –portal delivering versatile content and services for different categories of users; (2) convenience in operating the portal due to powerful customization and functionality, (3) high-downloading speed due to closeness to end-user.

6.2.3 Building Brand Loyalty

Key brand marketing task at this stage is to let every new product/service branded Kyrgyzstan Development Gateway evoke associations with high quality and excellent performance and to impel portal beneficiaries to make decisions on repeated consumption of KgDG portal products or services. For this purpose only integrated, tested and customer-

34

oriented products/services will be offered. To achieve better results the following actions will regularly be undertaken:

−Testing specific products/services−Research of users’ opinion and behavior patterns−Generating and analyzing consumer databases

This stage should be implemented in line with the brand awareness efforts but should not be limited by particular timeframe.

6.3 Promotion StrategyFor Kyrgyz users, the main constraints in more intensive use of the Internet are low degree of PC and Internet penetration rates and high prices for ISP services (See Internet Market Analysis). Therefore critical success factor for KgDG portal is the provision of low-cost solutions for Internet access for those who want but cannot afford using the Internet.

To address this issue KgDG project has signed cooperation agreements with Kyrgyzstan country representatives of IREX and UNDP. As per these agreements time will be reserved in the existing operation schedule of the telecenters network run by IREX and UNDP so that all who wish can work with KgDG portal.

The main communication channels, which will be used to affect the target audiences have been determined within the framework of KgDG Needs Assessment Research, are presented below.

Per

son

al c

onta

cts

Exh

ibit

ion

s/p

rese

nta

tion

s

Dir

ect

mai

l

On-

line TV Radio

Adv

erti

sem

ent

Pub

lici

ty

Adv

erti

sem

ent

Pub

lici

ty

Pu

bli

cati

ons Promotional items

Fly

ers

Bus

ines

s ca

rds

Pos

ters

Sou

veni

rs

Donor organizations X X X X X X XGovernment X X X X X XNGOs X X X X X X X XPrivate Sector X X X X X X X X X

Individuals X X X X X X X X X

Promotional tools used may be divided into two groups: online and offline.

6.2.1 Online Promotion

Registration in search engines/directories/rating systemsAs of April 2003, KgDG portal has approached more some 500 largest international, regional and local search engines and catalogues of links. The portal registration work will proceed.Banner Exchange and click-through programsKgDG project will embark on creating its own banner network to focus on particular target audiences, which will be used as a revenue source and also as a portal promotion tool. The

35

portal will also be promoted in national and regional banner networks (www.reklama.kg , www.reklama.ru etc).

E-mailing campaignE-mail addresses will be collected while being registered with the portal (to enable users enjoy advanced customization and personalization features or to enable content partners to upload content), using KgDG own e-mail service and subscribing to the materials published on the site.

Other Internet Marketing toolsDeveloping a mix of free trials of value-added services, free on-line newsletters and press-releases, using reciprocal web linking program, placing www.gateway.kg URL on all marketing materials, encouraging bookmarks, launching in-store promotions (i.e. internet cafes, IT retailers), implementing “tell a friend” referral system.

6.2.2 Offline Promotion

Personal Contacts, Direct Mails – self-explanatory

Marketing Collateral - business cards, flyers, posters. The marketing collateral will be used in promotional activities, such as exhibitions, trades, conferences, or other special events with the intended audience. The content will be modified as new services are developed.

36


http://www.reklama.ru/

http://www.reklama.kg/

7. TECHNOLOGY STRATEGY

7.1 LocationAt its incipient stages the portal was located at www.kyrgyzinvest.org , which was one of the fullest (more than 4,000 pages) and most popular sources of information on Kyrgyzstan27.

In 2001, KgDG portal moved to www.gateway.kg . T he previous site's function is now to monitor the Comprehensive Development Framework (CDF) implementation in Kyrgyzstan. On moving, the portal has fully sustained its content that has been placed on a new technological platform. A new design has been developed for the site as well.

At the moment KgDG portal is hosted in Kyrgyzstan, its compatibility with the Development Gateway guaranteed through the use of technology developed by Development Gateway technology team (XML).

The connection with Development Gateway technological platform will be bi-directional: KgDG will provide high-quality content, and DG will provide technologically sophisticated services (such as e-commerce, e-government solutions). Due to this reason KgDG vortals’ functionality will grow step-by-step.

7.2 Technology PrinciplesKgDG portal technological solutions meet the following requirements:

• Easy site administration and moderation – this requirement is evident due to low level of computer equipment and IT skills among the project partners. KgDG portal user can upload documents from browser without installing additional applications.

• Cross-platform and cross-browser compatibility.

• Architecture flexibility and scalability – KgDG solution allows changing easily the existing structure of portal, introducing new modules of the portal, providing additional features and functionality, linking up external databases to the portal.

• KgDG has centralized software and hardware platform with distributed content management. It is not only content coordinator, but also unlimited number of content-partners who upload documents. Each content partner is vested with right to develop only his own thematic section of portal, but at the same time he may further entrust rights to own content partners to develop subsection of his section. Treelike hierarchy structure of KgDG portal is presented below.

27 According to the statistics provided by the NeedaCom ISP provider (www.needa.com ) , average number of web-site sessions per day exceeded 1,000, and average number of hits per day was over 10,000.

37



http://www.needa.com/

• Customization - KgDG portal offers customization with regard to content, appearance and language. Customization will utilize various design templates based on user preferences. The templates can be based on different page layouts as well as on different types of information delivered to the user.

• Sustainability and high protection degree – the portal quality and success will largely depend on service and information security. An opportunity will be available with portal to combine open and password-protected areas, restrain access right depending on user categories; cryptography techniques will be used with some services.

• Low hardware requirements. As the project's financial situation will be unstable in the short term due to grant dependence, the technological solutions used for portal development must guarantee high effectiveness while hardware capacities are limited.

7.3 Logical InfrastructureKgDG decided to create own system based on open source products. In-house solution was preferred because package offered by global Development Gateway has a number of drawbacks, limiting its use on country level. Thus, use of Oracle DBMS in such small Country Gateways as Kyrgyzstan was not justified from the cost-benefit viewpoint, even taking into account its highest speed and performance. Application of free solutions like MySQL, which also fully meet technological requirements of Country Gateways, seems to be more reasonable. AOL server has never been used most of KgDG counterparts, in contrary to Apache Server. AOL server has low degree of cross- platform compatibility, though it is based on TCL. Solutions used at the moment of KgDG launch didn’t support national languages. Creation and allocation of templates was cumbersome for users unfamiliar with BSD operating system. Due to above and a number of other reasons, KgDG team after consultation with key stakeholders decided to develop own system.At the present time the content management system developed by KgDG has successfully passed more than the two-year period of use, and undergone many changes and additions. In order to speed up creation of necessary web applications into the system was included scripting language PHP, which is not less functional than Perl, but at the same time is much more convenient at creation of services of small scale. Thus the technologies used by KgDG look as follows: Http-server ApacheProgramming language Perl, PHPDBMS MySQL

38

7.4 Current Portal Functionality1. General information. The portal currently handles 12268 documents in Russian

and 7269 documents in English (as of April 24th, 2003). This amount of documents contains news and analytics, as well as general geographic and socio-economical information on Kyrgyz Republic and its towns.

2. The content management system of the portal is multi-user shell with distributed rights management. The CMS allows easy publishing of documents directly from WYSIWYG text editors (MS Word, Star Office, etc.) via importing of doc, rtf and html documents, including graphics and all other kinds of multimedia content. The newly added content provider can be easily registered by administrator or by registered content administrator through the Web based interface. Web interface of the content management system supports English and Russian languages; new languages can be added if necessary. Content management system supports automatic entry of key words and description, enabling efficient and fast indexation by search engines. Based on keywords list system automatically forms list of thematic links - a powerful tool, assisting users in data search.

3. News exchange module publishes all news and updates in XML format to organize document flow between www.developmentgateway.org portal and KgDG portal.

4. Banner system allows content-administrators posting banners to both specific sections of KgDG portal and to external web sites. Major advantage of the system is the opportunity of selecting thematic sections in which specific banner should be demonstrated. E.g. banner leading to the site on economic legislation can be demonstrated in sections “Kyrgyzstan”, “Legislation”, “Investment climate” etc. Banners can be created dynamically, e.g. if one wants to create a simple banner he just needs to enter the text which will be displayed on banner and choose the appearance of the new banner. The banner will be created automatically and will appear in appropriate sections of portal.

5. Forum. Forum module is very flexible, allowing initiating discussions of each document published on the portal. All forums are being moderated. Messages can be filtered by posting date. Each portal page has links to the discussion of the presented material.

6. Subscription. Module enables users to subscribe to updates of the portal sections and receive update alerts via e-mail.

7. Search. Portal supports full-scale search system covering all portal pages and allowing AND/OR logical expressions.

8. Multilingual support. Software supports both Russian and English versions. Users can switch from Russian to English version and vice versa at every page of the portal.

9. Accessibility for disabled people. Portal enables users with poor eyesight to use large fonts when surfing the portal.

10. Usability. Short description of sections and materials, which is shown in pup-up-style tips, allows users to understand the essence of the material before clicking the link, thus saving much time during information search. The home page also contains list of the updated materials and new forum messages. Key navigation tool is the comprehensive site map, demonstrated as a tree-like structure of portal sections. Forum map showing forum sections and number of messages in each section is

39

http://www.developmentgateway.org/

presented in the same manner. Each portal page enables users to sent links to this page via e-mail or save it in his browser.

7.5 Proposed Technology ImprovementsThe main priority in KgDG portal development for the 2nd implementation cycle will be cohesion of poorly-integrated KgDG vortals at technological and content levels. Integration will cover all vortal and will have the following purposes:

• To provide direct access to all KgDG vortals from any point within KgDG portal taxonomy• To enhance navigation convenience at vortal level• To provide integrated web-service packs for various types of users• To reach a new level of content interaction between KgDG and Development Gateway• To create an content interexchange system within Central Asian CGs

The new level of integration of portal resources will be based on the following elements:

• Main portal page, which is carrying out function of navigation to all resources of the portal• Uniform navigation panel for all sites, working at a principle of Internet ring, providing easy

surfing on the portal resources• Uniform internal search system providing search in all resources of the portal• Multimedia news interexchange system based on news and materials of all sites of portal• Thematic links service, working within the frameworks of whole portal and providing users

with links to relevant materials for any document, placed on the portal• XML translation service, transforming all portal resources into the XML format and providing

all needs that can arise during the development of an information exchange with Development Gateway and Country Gateways

1st cycle of implementation activities

2nd round of implementation activities

Low integration level KgDG portal main page will act a main page of a Workplace Integrator Portal and will include links to the vortal’s sections, update alerts, forum, unified search engine etc.

Direct links to vortal pages are only available on main pages

Unified navigation bar supported by all KgDG vortals and including several levels of navigation (vortals-level, sections within specific vortal and thematic links). Bar contents will dynamically change depending on location of user within KgDG portal taxonomy.

Search engine only seeks content within specific vortals

Unified search engine with portal-wide (not vortal-wide) indexing capabilities

Vortal news can not be accessed from other main page of KgDG vortal

News line with dynamic uploading of news from KgDG thematic sections, which can also be used as a mean of KgDG portal promotion via other Kyrgyz web-sites.

Relevant thematic links are confided to content of specific vortal, no intervortal thematic links exchange

Intervortal thematic links exchange enabled

www.developmentgateway.org supports only uploading of headlines and brief description of news

XML transformation system, will ensure data interexchange both within Central Asian CGs and between KgDG and www.developmentgateway.org fore wider spectrum of content types.

40



KgDG web-resources taxonomy after 1st implementation cycle looks the following way:

After internal integration of KgDG web-resources into unified system, KgDG portal taxonomy will look the following way:

Possible format for content integration between Central Asian CGs and www.developmentgateway.org can be described the following way:

41


Special emphasis will placed on developing integrated web-service packs for different categories of users.

Similar integrated solutions will also be developed for other categories of users: • Individual portal visitors • Investors&donors• NGOs• Public administration agencies

Currently information interexchange between KgDG and DGF is being developed via XML-based uploading of KgDG news headlines to www.developmentgateway.org . To increase the document flow KgDG intends to develop module, which can automatically upload links to almost 20 thousand KgDG resources to relevant sections of www.developmentgateway.org .

For instance, a company, that have registered with database of vendors can also create own web-page, register new or existing web-site in the catalogue of links, post prospective business-plan within investment seekers-database and subscribe KgDG update alerts on topic of interest.

42



8. CONTENT STRATEGY

8.1 KgDG Portal StructureKgDG portal (www.gateway.kg) is the key project element and partnership tool. Portal can be visualized as two-dimensional system bringing together vertical development communities (vortals) in a common electronic space through shared horizontal functional platforms (horizontal portals) which will provide a comprehensive set of information, communication, knowledge and hosting services to KgDG stakeholders.

Horizontal platforms:

• Your Gateway to Kyrgyzstan - entry page, standard portal features plus basic content on development organized by stakeholder groups and themes. Serving basic needs for development information.

• KgDG Forum - serving communications and discussion needs of development stakeholders

• KgDG Knowledge Database - serving development knowledge needs, providing premium development data and knowledge resources tailored to end-user needs

• My Gateway - virtual offices of KgDG partners/users plus customized access to various Gateway platforms, serving hosting and workspace needs.

Vertical Portals (Vortals):State/governmental bodies, NGOs, private sector and international organizations are the principal target groups of the project vortals. While functional platforms of every vortal will offer many identical functional tools (hosting, content administration and ads management modules, discussion forums, web-directories etc), there will be much vortal-specific content:

Database title as for KgDG Implementation grant

proposal

Affiliation with specific KgDG vortal

Primary content-provider

Directory of Kyrgyz vendors, products and services

Business Development vortal

KgDG

ICT Market Database ICT web-site Foundation for Information AssistanceDatabases of public agencies on central and regional levels

E-Government vortal

Presidential Administration

Database on investment opportunities


Council on FDI promotion under the President of Kyrgyzstan

43

Services/ Platforms

Communities/Stakeholders vortals


Database of investors and international agencies engaged into investment promotion


Council on FDI promotion under the President of Kyrgyzstan

Database of funding opportunities

NGO vortal Center for Public policy

Database of Kyrgyz NGOs NGO vortal Center for Public policy

8.2 Content generation and managementDuring 1st year of Implementation Stage portal content was generated in two different ways:

- Direct content uploading. The technology solutions developed by KgDG project enable decentralized content uploading that allows local content providers posting materials to portal regardless of their location and technology proficiency level. Portal administration mode is simple and doesn’t require content providers to possess knowledge of network technologies or programming language, text editor skills are enough to post and edit content.

- Integration of the existing information resources. As the technological platform developed within the framework of the project is an advanced one as compared with other Internet projects in Kyrgyzstan, a number of sites have already expressed their wish to use it. All sites that have adopted KgDG technological solutions will be integrated into KgDG portal structure. E.g. E-Government vortal, was created within the framework of the project, will integrate existing sites of state agencies.

The latter approach will dwindle during 2nd cycle of implementation activities, while direct content-uploading by content-providers will accelerate.

Currently there are 2 types of content-partners:

• Primary content-partners coordinate preparation of vertical resources within Kyrgyzstan Development Gateway portal taxonomy.

• Secondary content-partners support maintenance of separate sections within frameworks of vertical resources and work under supervision of primary content-partners.

Such scheme of cooperation assures long-run sustainability of the portal and vertical platforms, reducing their dependence on financing from Development Gateway Foundation. Similar content generation style KgDG intends to utilize for the Central Asian Development Gateway.

Activity of secondary content-providers, which in FY2002-2003 loaded from 40% to 70% of the content, is not remunerated from InfoDev or Development Gateway Foundation resources. However they get possibility of co-branding their resources. Frequently, sections, which are maintained by secondary content-providers, can be positioned as their official web-sites (e.g. http://rus.gateway.kg/decentr_congress)

50% of the primary content-providers activity is paid from their budget and 50% - from KgDG budget.

Therefore even in the case of delay in financing from Development Gateway Foundation, resource development is sustained by primary content-partner. At the same time resource is positioned as a result of joint activity of KgDG and primary content-provider.

44

Thus, due to the use of decentralized content management technologies, KgDG portal will be a self-evolving system with direct content uploading provided by the partners themselves. The Content Group will be responsible for providing access to content administration tools, trouble-shooting, editorial supervision and feedback maintenance.

8.3 Translation StrategyIn order to reach the largest audience, KgDG will be built in Russian and English. Translation will be an integral part of the overall site management. Language translation will be accomplished in three different methods, depending on the nature of the content:

• Human translation (for static content, i.e. menus, bios, contact information and the most important content);

• Computer-assisted translation (for repetitive and technical documents, tables)• Machine translation (for content that – due to time or financial constraints cannot

be translated by human translator immediately) – e.g. weather, quotations, exchange rates.

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9. PARTNERSHIP STRATEGY

Partnerships are essential for the success of KgDG – to support better development outcomes, help mobilize funds, supply content etc. KgDG is fundamentally about strengthening and creating development partnerships and currently involves almost 50 partners28. Any individuals and organizations with development expertise or concerns are encouraged to become involved in KgDG.

There are several categories of resources necessary for successful implementation of the project:

o Technology partners, which provide hardware, software, network and web-design solutions.

o Content partnerso Financial partnerso Business development partners, which promote KgDG paid-for services o Coordination partners29, which ensure management of KgDG online e-pilots and all

parties involved into pilots implementation)

The last two categories represent a new partnership types, compared to KgDG planning phase. Their emergence is the consequence of the changed KgDG partnership needs.

For such comprehensive project as KgDG it is very important to assure the support of top level Government officials. In June 2000 the Order of the Prime Minister of the Kyrgyz Republic on measures to support the Project was adopted. At the planning stage of KgDG development, the Memorandum of Understanding with the Administration of the President of Kyrgyzstan was signed. These ties warrant a high level support to the Project by the Government.

A number of workshops for stakeholders were arranged to ensure their participation in the project.

Incentives used by Kyrgyzstan Development Gateway project for partnership building

Private Sector

• The World Bank strong brand name• Sales growth through the local market development• Access to international markets• Probe untapped Internet opportunities (such as transaction platforms)• Take over the e-niche (first mover advantage)• Obtaining consulting support from the Project analysts• Quick creation of own information resources and complexes through the use of

KgDG universal softwareCivil Society • Better possibilities for advocating ideas and goals

• Assistance in terms of donor database matchmaking services and consultations in preparation grant documentation

• Cost-efficient opportunities for community expression• Promotion of the level of public education (through e-knowledge and

distance-learning programs)Government • Improved relationship between governmental institutions and

citizens/businesses/NGOs• Increasing transparency and information openness of Kyrgyzstan; reducing

28 All partners will sign a Partnership Agreement concerning their concrete contribution in the project.29 Sometimes referred to as primary content partners

46

corruption• Increasing effectiveness of state procurements and privatization processes• Improving international image and investment attractiveness of the country • Organizing effective information exchange among the partners in Kyrgyzstan

and abroad• Guaranteeing citizens' right for information and public awareness about state

bodies' activities• Assistance in preparation of national strategic documents, such as ICT

Development Strategy, E-Development Strategy (information, research, analysis and consultations)

Donors and International Organizations

• Development focus of KgDG• KgDG as the facilitator and monitor of IT initiatives of different donor and

international organizations on the country level• Better information exchange between donor organizations and government

Information resulting in increased transparency and efficiency of foreign assistance

47

10. ORGANIZATIONAL STRUCTURE

10.1 Governance

The analysis of the Kyrgyz legislation and consultations with partners has shown that the optimal model of implementing agency for the project is the one offered by Foundation “Information Assistance” (structure is presented below).

The NGO governing bodies are:

• The supreme body of management: General Assembly of Founders• The supervisory body: Supervisory Board• The executive body: Steering Board• The controlling body: Inspection Commission

Foundation “Information Assistance” is not a membership-based organization. Relationships with partners are formalized through partnership agreements signed by the Project. Stakeholders are also attracted into the Project implementation through participation in the Supervisory Board.

It is expected that during 2nd cycle of implementation activities, number of Supervisory Board members will be increased.

It is also expected that subsidiary of Foundation “Information Assistance” will be registered to deliver paid-for services of KgDG.

See terms of reference for each governing body in annex 7

10.2 Management and StaffingPresented below is the structure and TOR of the working groups that will be created for project implementation.

48

Project Manager

Partnership Building Group

Business Development Group

Portal Development

Group

Content Group

Steering Board (KgDG PMU)

Supervisory Board (Key counterparts)

General Assembly of Founders

1) Project Manager is responsible for overall quality control, efficient division of labor within the project team, high-level partnership building, negotiations and liaison with the Supervisory Board and the Development Gateway Foundation. Project manager invites local partners to join the project, facilitates signing of the MoUs and other partnership agreements.

2) Strategy/Business Development Group is headed by Business Development Coordinator (which can also act as a deputy project manager) and research specialist. Group is responsible for:

• Developing the ideology/strategy of KgDG project• Developing project M&E system and act as PIMU.• Preparing a standard set of project documents, including fundraising, governance and legal

documents • Conducting marketing and PR campaigns • Organizing commercial servicing of the project clients• Identifying business development partners• Attracting investors and donor organizations in the Project implementation (together with the

Partnership Group)• Developing new commercial and non-profit project activities

3) Content Group consists of Content Coordinator and multiple content specialists. CG TOR is charged with:

• Elaborating KgDG portal and vertical platforms’ taxonomy• Searching, selecting and editing content for the KgDG web-resources• Acting as liaison with the Development Gateway Content Team• Deciding which portal sections will be developed in-house and which will be outsourced

(together with BDG)• Attracting thematic guides for KgDG vortals• Establishing content partnerships (together with Partnerships Coordinator)• Ensuring efficient work of Editorial Advisory Board

4) Partnership Building Group (PBG) consists of Partnership Coordinator (PC)

• Developing partnership strategy sensitive to local conditions (together with BDG)• Developing and conducting PR campaign (together with BDG)• Organizing of workshops and roundtables for project stakeholders• Building broad-based partnership framework for KgDG • Securing non-commercial sources of funding• Preparing partnership agreements for content, funding and technology partners

5) Technology Group (TG) consists of Technology Coordinator (TC) and technology specialists. TOR for technology group will include:

• Developing of technology specifications of project documents• Acting as a liaison with the Development Gateway Technology Team• Building KgDG portal platforms in compliance with its technology specifications • Dealing with all technology-related issues of content gathering • Organizing online servicing of the portal visitors (together with BDG)

See biographies of key members of KgDG team in annex 8.

49

50

11. BUSINESS STRENGTHS

• Use of the brand and access to analytical and information resources of Development Gateway Foundation

• Powerful potential in incubating innovative ICT projects, which is guaranteed by partnership network involving the State and local stakeholders

• Strong potential in promoting the project towards international level due to availability of global partnership framework of Development Gateway initiative

• Concentration within KgDG project the most objective and comprehensive information on ICT development in Kyrgyzstan

• Universality and easy-to-handle nature and interoperability of the technological solutions used

• Implementation of the project through the highly visited portal successfully promoted during the Planning and implementation Stage

• Uniqueness of the business model, combining both development and business aspects and maximizing range of funding sources

• Availability of package of ICT-for-development projects prepared during the Planning Stage

• Innovative character of services offered by the project, compared to ones existing at the local market

• Sustainability of the proposed model based on broadly diversified range of businesses• Highly qualified core team to lead the project during Implementation Stage• High demand for the rendered services registered by local communities and target groups

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12. POTENTIAL RISKS

CATEGORY RISK Degree of Risk

KgDG antirisk policy30

Ext

ern

al R

isk

s Worsening political situation L

ow Positioning project as apolitical portal aimed exclusively at harnessing ICT for sustainable development.

Unprepared legal base

Med

ium Preparing recommendations for KgDG governmental

counterparts on necessary legislative amendments.

Forming working groups of local experts to lobby necessary legislation.

Local market purchasing capacity plummeting

Med

ium Re-orienting project's commercial component towards

regional markets, expat community and emigrant networks

High competition at the local market L

ow Abiding by strategy of merging and cooperation with the existing internet projects.

Positioning KgDG portal as facilitator of ICT field development rather than competitor to existing projects.

Offering products and services, which are unique and innovative for the local market.

Unforeseen change of market situation

Low Continuously monitoring market trends at local, regional

and global level. Adhering to flexibility of strategies and approaches used to achieve the goals

Low PC and Internet penetration rates M

ediu

m Moving some of the project activities to offline dimension (producing CD-ROM containing the Portal copies, publishing unique portal content in offline partnering media).

Organizing collaboration with donor agencies to expand opportunities of using services delivered by the Portal (expanding telecenters network, re-scheduling operation of the existing telecenters)

High level of Internet illiteracy

Med

ium Involving universities in the project implementation and

development of the appropriate training courses.

Mental stereotypes of local consumers and ignorance of the services offered

Med

ium Advocating and popularizing opportunities the ICT offer

through offline communication channels

Conducting regular marketing research to uncover causes of consumer loyalty and interests of the potential audience in content and services, setting up feedback and continuous quality control of the products

30KgDG Project antirisk policy aims at lessening probability of respective risks or, if risk situation occurs at conducting damage limitation activity

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Inte

rnal

Ris

ks Loss of key

partners Low Developing well-elaborated system of partners’ motivation

and implementing project based on maximum transparency, inclusiveness and cooperation to gain positive reputation.

Establishing contacts with several partners (in content, technology and financial support perspectives) in each of the target segments

Funding issues

Med

ium Diversifying sources of funding (donor resources, state

support and private investment)

Insufficient content of the portal

Low Positioning the Portal as a highly-customizable, convenient

and free tool to create own Internet resources and services

Prioritizing content partnership among the well-known information providers (mass media, libraries, scientific, research and consulting agencies), which due to some reason use ICT in limited manner

KgDG institutes annual Internet Award to additionally encourage local communities to generate information resources

Non-competitive technology L

ow Conducting continuous market research to introduce new ICT solutions and reveal drawbacks of the existing ones.

Securing technological compatibility of the introduced solutions with the project partners and consumers. Developing universal, cost-efficient and easy-to-handle solutions.

Lack of skilled personnel L

ow Adhering to transparent recruiting policy, ensuring selection of the best human resources, representing the entire spectrum of project stakeholders.

Creating conditions for staff training and skill enhancement.

Incorrectly formulated development strategy

Low Regular revision of project priorities and approaches

through broad-range consultations with all stakeholders.

Creating effective project management structure guaranteeing regular M&E of the project implementation

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ANNEXES

ANNEX 1. Overview of key KgDG partners

Content Partners

Web-site (portal) Primary content-provider 31

Description of primary content-provider

www.gateway.kg Kyrgyzstan Development Gateway project

See section 3.2 of the report

http://ngo.gateway.kg Center for Public Policy (NGO)

Non-governmental non-commercial organization established to render support of the development of democracy and civil society in Kyrgyzstan through public policy and governance development, and public initiatives support.

http://business.gateway.kg

State Commission for SME development (Government)

The commission is in charge of maintaining domestic small and medium enterprises through creation of the favorable legal and economic environment.

http://invest.gateway.kg

Council on FDI promotion under the President of Kyrgyzstan (Government)

Board is the state body charged with coordination and implementation of measures to promote FDI inflow to Kyrgyzstan. Other key tasks of the Board include developing FDI promotion strategy and Action Plan, developing FDI-related legislation.

http://www.gov.kg Presidential Administration (Government)

Presidential Administration is the state body, which provides implementation of Constitution-stipulated right and authorities of President of the Kyrgyz Republic

Technology partners

ISP Elcat – leading Kyrgyz ISP, providing the following services: supply and installation of network equipment, technical staff training, and creation of integrated information systems supporting all types of business applications. (Examples of ElCat projects include development of large information systems include nationwide Shailoo election system and Public Management Information System).

Business Development Partners

Name of the partner

Description of the partner Sectoral Affiliation

Foundation for Information Assistance

Foundation was established in April 1999 to promote economic development of Kyrgyzstan through facilitating information availability, and lobbying information transparency in Kyrgyzstan.

NGO

Expert Consulting Expert Consulting Agency is one of the leading consultancies in

Private Sector

31 This category of KgDG stakeholders in some project documentation used to be called coordinating partners

54

http://www.gov.kg/

http://invest.gateway.kg/

http://invest.gateway.kg/

http://business.gateway.kg/

http://business.gateway.kg/

http://ngo.gateway.kg/


AgencyKyrgyzstan, which specializes in marketing research & consulting, management & HR consulting, analytical information services

Apparatus of Kyrgyzstan’s Vice Prime-Minister

Mr. Joomart Otorbaev, Kyrgyzstan’s vice prime-minister charged with economic growth and FDI promotion issues

Government

Center of Social and Economic Studies (CASE-Kyrgyzstan)

Leading think-tank in the area of social and economic development of Kyrgyzstan, member of the international think-tank network CASE, with HQ in Poland (Warsaw )

NGO

ANNEX 2. KgDG Portal Taxonomy32

Please seehttp://rus.gateway.kg/cgi-bin/tree.plhttp://eng.gateway.kg/cgi-bin/tree.pl http://www.investment.kg/cgi-bin/tree.pl http://eng.investment.kg/cgi-bin/tree.pl http://ict.gateway.kg/cgi-bin/tree.pl http://ngo.gateway.kg/cgi-bin/tree.pl http://business.gateway.kg/cgi-bin/tree.pl http://www.gov.kg/cgi-bin/tree.pl

ANNEX 3. TORs of governing bodies of Foundation “Information Assistance”The General Assembly’s terms of reference cover:

• Developing framework for the Foundation activities;• Amending the Charter of the Foundation;• Deciding issues on whether to establish or liquidate affiliated offices, representative offices and

subsidiaries as well as approving Charter and provisions;• Approving organizational structure of the Foundation; managers’ remuneration levels; annual

budget;• Establishing amounts and directions of the use of funds and property of the Foundation;• Electing Supervisory Board and Inspection Commission members;• Approving balance and annual report of the Foundation;• Taking decision on reorganizing the Foundation• Addressing other issues related to the Foundation activities

Supervisory Board, created to supervise the Foundation activities between the meetings of General Assembly of Founders, is tasked with:

• Supervising activities and policies of the Foundation; • Approving deals that envisage a conflict of interests; • Appointing and recalling members of the Steering Board; • Approving deals that envisage a conflict of interests; • Approving annual progress reports prepared by the Steering Board;

The Steering Board is headed by Chairman who:

• Generally governs current activities of the Foundation;

32 Only four initial portal structure levels are indicated, in-depth development of portal’s taxonomy and increase in number of vortals are expected as more content-partners attracted

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http://www.gov.kg/cgi-bin/tree.pl

http://business.gateway.kg/cgi-bin/tree.pl

http://ngo.gateway.kg/cgi-bin/tree.pl

http://ict.gateway.kg/cgi-bin/tree.pl

http://eng.investment.kg/cgi-bin/tree.pl

http://www.investment.kg/cgi-bin/tree.pl

http://eng.gateway.kg/cgi-bin/tree.pl

http://rus.gateway.kg/cgi-bin/tree.pl

• Represents the Foundation in its relationships with governmental and non-governmental organizations, legal and physical entities;

• Signs agreements and contracts on behalf of the Foundation without proxy and guarantee execution thereof;

• Opens settlement and other accounts in banks; • Issues orders, instructions and other internal documents;• Employs and dismiss the Foundation officers;

The Inspection Commission

• The Inspection Commission exercises control over lawfulness and effectiveness of the Foundation funds utilization and financial and economic activities.

• The General Assembly of Founders elects the Chairman and three members of the Inspection Commission for a 3-year period.

• Steering Board and the Supervisory Board members cannot be members of the Inspection Commission.

• The Inspection commission is responsible for mandatory audit of financial (accounting) reports of the Foundation that would involve independent auditor.

• The Inspection Commission elects an independent auditor whereupon the Supervisory Board Chairman on behalf of the Foundation signs an audit contract.

• The Inspection Commission shall check up financial and economic activities of the Foundation. The Inspection commission shall prepare a conclusion based on the check-up and audit results, which is to be submitted to the General Assembly of Founders.

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Updated Business Plan

Documents