RURA - Fair Competition - Quality of Service - Development
Col D. Mudenge Eng. MCM ,Col D. Mudenge Eng. MCM ,ViceVice--Chairperson Regulatory Board &Chairperson Regulatory Board &
Ag Director General Ag Director General -- RURARURA
Communication Sector Reform: Communication Sector Reform: Liberalisation, Liberalisation,
Law and Regulation Law and Regulation and Universal Service policy and Universal Service policy
in Rwanda.in Rwanda.
RURA - Fair Competition - Quality of Service - Development
IntroductionIntroduction
The Rwanda, being one of AfricaThe Rwanda, being one of Africa’’s smallest s smallest Countries, is no doubt the smallest country in Countries, is no doubt the smallest country in East and Central Africa. East and Central Africa.
It has enjoyed a period of stability and democraticIt has enjoyed a period of stability and democraticinfrastructure set up for over twelve years since itsinfrastructure set up for over twelve years since its1994 Genocide Aftermath. 1994 Genocide Aftermath.
RURA - Fair Competition - Quality of Service - Development
IntroductionIntroduction
Unlike Asian countries, Rwanda like other SubUnlike Asian countries, Rwanda like other Sub--Saharan countries is still striving to translate theSaharan countries is still striving to translate thebenefits of its small size, stability, security and thebenefits of its small size, stability, security and theunprecedented clear political support from the topunprecedented clear political support from the topleadership and the expected benefits of the leadership and the expected benefits of the Communication sector into a real national growth. Communication sector into a real national growth.
RURA - Fair Competition - Quality of Service - Development
IntroductionIntroductionThe overall objective of this presentation is to highlight keyThe overall objective of this presentation is to highlight keysteps of Rwanda Communication Sector Reform through :steps of Rwanda Communication Sector Reform through :
a.a. Liberalisation and Commercial Environment Liberalisation and Commercial Environment structure ensuring effective and workable ICT Policy structure ensuring effective and workable ICT Policy implementation;implementation;
b.b. Establishment of laws and Regulation framework of Establishment of laws and Regulation framework of the ICT policy that respond to the Government vision the ICT policy that respond to the Government vision 2020 perspective;2020 perspective;
c.c. Establishment of Universal Access Policy Establishment of Universal Access Policy implementation (required) outputs that shall contribute implementation (required) outputs that shall contribute towards the poverty alleviation efforts and thereby towards the poverty alleviation efforts and thereby enhancing economic development.enhancing economic development.
RURA - Fair Competition - Quality of Service - Development
WHY A VISION ?WHY A VISION ?
All things are created Twice !“Begin with end in mind is based on the principle that all things are created twice. There‘s a mental or first creation and a physical or second creation to all things.“
Stephen R. Covey The 7 Habits of Highly Effective People
RURA - Fair Competition - Quality of Service - Development
Digital Divide
Digital Divide
Universal AccessUniversal Access
Law and Regulatory Framework
Law and Regulatory Framework
Liberalisation, Commercialisation and Privatisation
Liberalisation, Commercialisation and Privatisation
Communication Sector Reform: Liberalisation, Law and Regulation and Universal Service
Policy in Rwanda.
RURA - Fair Competition - Quality of Service - Development
The Role of Communications' Sector Reform in achieving a competitive
liberalised market environment:
RURA - Fair Competition - Quality of Service - Development
The Digital DivideThe Digital Divide
RURA - Fair Competition - Quality of Service - Development
The Digital DivideThe Digital Divide
RURA - Fair Competition - Quality of Service - Development
Benefits from full and open competition Benefits from full and open competition of Communications Sectorof Communications Sector
Efficient Regulation:
Greater transparency and predictability
Fair &efficient
Competition:Consumer savings/
Lower prices.
Many Operators:benefit from increased
demand
Workers benefitfrom increased
Employment/Jobs.
Economic performance/Economic Stimulus.Economies expand (GDP),
Gvt benefit From increased tax
revenues
Digital Divide Reduces:Society benefit
From new applications for
health, education etc.
RURA - Fair Competition - Quality of Service - Development
PEST ANALYSISPEST ANALYSIS
CommunicationsReform
PoliticalStable
Full Support
EconomicSteady progress
TechnologyNew Challenges
SocialSignificant impact
• Status of government• Priorities: provision of basic services, job
creation, poverty elimination, growth• Importance of corporate citizenship• Greater focus on governance and
corruption eradication : e-gov
• Deregulation of industry through changes in legislation
• Uncertainty re regulation of new players and their participation in the market • Rapid change and growth in complexity with many new players in the market
• Convergence of technologies and industries• Uncertain consumer uptake of new technologies, readiness and overload• Innovations to influence profitability
• Growing middle-class with growing potential uptake of operators’ services
• HIV/Aids has a significant impact on society with uncertainty about long-term effects e.g. labour, healthcare etc.
• Growing poverty in certain areas• Evolution of media space• E-school
• Status of competitive environment• Status of economy; • Rate of inflation• Uncertainty regarding the impact of oil
prices and exchange rates continue• Pricing models and operational systems
are complicated
RURA - Fair Competition - Quality of Service - Development
Laws and Regulation framework:Laws and Regulation framework:
RURA - Fair Competition - Quality of Service - Development
Laws and Regulation framework:Laws and Regulation framework:•• RURA Law ( Convergence issue)RURA Law ( Convergence issue)•• Telecom Law > < Telecom Law > < ICT Law in preparationICT Law in preparation•• Competition LawCompetition Law
RURA - Fair Competition - Quality of Service - Development
Laws and Regulation framework:Laws and Regulation framework:
Rwanda has integrated the East African Rwanda has integrated the East African Community. Community.
In order to harmonise with East Africa Regulatory In order to harmonise with East Africa Regulatory Framework, Rwanda needs urgently to work withFramework, Rwanda needs urgently to work withothers member states for the harmonisations ofothers member states for the harmonisations offollowing issues, Summarised in form of questionsfollowing issues, Summarised in form of questionsas follows : as follows :
RURA - Fair Competition - Quality of Service - Development
Does the regulatory framework facilitate the provision of Does the regulatory framework facilitate the provision of different services over different platforms (e.g., technology different services over different platforms (e.g., technology NeutralityNeutrality……) ?) ?
Does the regulatory framework support full competition? Does the regulatory framework support full competition?
Does the regulatory framework allow service providers to Does the regulatory framework allow service providers to offer multiple services? offer multiple services?
What are the regulatory policies for these new technologiesWhat are the regulatory policies for these new technologiesand services with regard to numbering, spectrum, universaland services with regard to numbering, spectrum, universalservice, and interconnection? service, and interconnection?
RURA - Fair Competition - Quality of Service - Development
Does the EAC CountriesDoes the EAC Countries’’ legal framework contain the necessary legal framework contain the necessary legislation to support an ICT environment (e.g., intellectual legislation to support an ICT environment (e.g., intellectual property laws, computer crime, electronic transactions, data priproperty laws, computer crime, electronic transactions, data privacy vacy
and security)? and security)?
How much turnHow much turn--around time and process is required for thearound time and process is required for theEAC CountriesEAC Countries’’ legal framework to respond to future changes in thelegal framework to respond to future changes in thesector? sector?
RURA - Fair Competition - Quality of Service - Development
Reforms in Communications:Reforms in Communications:Law and Regulatory perspective Law and Regulatory perspective
The primary purpose of reform is :The primary purpose of reform is :
To get more consumers with better, new, and less costlyTo get more consumers with better, new, and less costlyservices. services.
To Address and Accommodate Pressures from ICT To Address and Accommodate Pressures from ICT LiberalisedLiberalised Market :Market :
incumbents who want ongoing protection, incumbents who want ongoing protection, new entrants seeking special deals/considerations or helpnew entrants seeking special deals/considerations or help( e.g. Right of ways, Interconnection agreement, ( e.g. Right of ways, Interconnection agreement, ……))
RURA - Fair Competition - Quality of Service - Development
Example of An Effective RegulatorExample of An Effective Regulator
An effective regulator is An effective regulator is Adequately funded. (GBP 164m p.a. for Adequately funded. (GBP 164m p.a. for OFCOM)OFCOM)Effectively skilledEffectively skilledWorks in the best interest of the consumerWorks in the best interest of the consumerCreates a level playing fieldCreates a level playing field
RURA - Fair Competition - Quality of Service - Development
Key Issues in Regulatory EstablishmentKey Issues in Regulatory EstablishmentPolicy and Legal frameworkPolicy and Legal frameworkFunctions and Role of AgencyFunctions and Role of AgencyInstitutional and governance frameworkInstitutional and governance frameworkFundingFundingIndependenceIndependenceLead time and Reform ImplementationLead time and Reform ImplementationTransparency, Predictability & FlexibilityTransparency, Predictability & Flexibility
RURA - Fair Competition - Quality of Service - Development
POLICY MAKER:MININFRA
Consumers/Gvt Agencies
RwandatelMTN-Rwandacell/No Competition : Low QoS
No Choice
A Direct Hand
RURA - Fair Competition - Quality of Service - Development
POLICY MAKER:MININFRA
Consumers/Consumer
Associations
Terracom-RwandatelMTN-Rwandacell/Artel/Altech , ISPs
Broadcasting & Other Media
RURA
No Competition : Low QoS
No Choice
Still A Semi Direct Hand
RURA - Fair Competition - Quality of Service - Development
POLICY MAKER:MININFRA
Consumers/Consumer
Associations
RwandatelMTN-Rwandacell/
Artel/ ISPsBroadcasting & Other
ICT Media
RURA
Fair Competition : High QoS
Many /Multiple Choices
Tariffs : More & more decrease
RURA - Fair Competition - Quality of Service - Development
The role of Communications' Sector Reform The role of Communications' Sector Reform in Achieving Universal Accessin Achieving Universal Access
in a competitive environmentin a competitive environment
RURA - Fair Competition - Quality of Service - Development
Overview of Universal Access and Universal Service
The terms universal access and universal service are often used interchangeably, because of their similar meanings, but the difference between the two terms is more than a nuance.
Universal service means that every household in the country has telephone service – traditionally, a fixed-line phone for every household. This is a practical policy objective in many developed countries, but in most developing market countries, it is only a long term goal.
RURA - Fair Competition - Quality of Service - Development
Overview of Universal Access and Universal Service
While universal service may be a realistic policy objective in developed countries, universal access is a more feasible practical goal in many developing countries.
Universal access policies seek to increase access to telecom services on a shared basis, such as on a community or village-wide level.
Universal access programs typically promote the installation of public payphones or public call offices in rural and remote villages or low-income urban areas with the aim of providing a basic and initialconnection to the telecommunications network.
RURA - Fair Competition - Quality of Service - Development
Rural V Urban Economics Funds?Rural V Urban Economics Funds?
Urban SiteUrban SiteCostsCosts
Power Grid?Power Grid?Local Transmission to Local Transmission to switchswitchEasy to reach for site Easy to reach for site engineersengineers
RevenueRevenueMostly outgoing callsMostly outgoing calls
Uneconomic if Uneconomic if interconnect is highinterconnect is high
High site utilisationHigh site utilisationDistribution relatively Distribution relatively easyeasy
• Rural Site– Costs
• High Fuel Cost• High Transmission Cost
– Especially on satellite• Costly to maintain
– Revenue• Mostly incoming calls
– Uneconomic if interconnect is low
• Low site utilisation• Distribution is difficult
RURA - Fair Competition - Quality of Service - Development
Balance!!!Balance!!!
Focus on the end user TerminalsFocus on the end user Terminals
Handsets and ComputersHandsets and Computers……
WLAN, LAN
GSM/WCDMA/CDMA2000 CDMA EVDO
DSL, Cable TV
PANBluetooth
RURA - Fair Competition - Quality of Service - Development
ACCESS IN DEVELOPING MARKETS IS ABOUT THE ACCESS IN DEVELOPING MARKETS IS ABOUT THE COST OF ACCESS, NOT USAGE PRICESCOST OF ACCESS, NOT USAGE PRICES
To him, the barrier to get connected to mobile is…
1. How much to join?
2. How much to stay connected?
3. How much to use?
IN THAT ORDER !!!
The “affordability” barrier for the poorest is:• cost of phones and SIM packs• any minimum spend requirement to remain connected, then• the price of making calls (and even then, compare this to the cost
of a trip to town!)
The focus should be cost of access & End User Terminal Handset !
“ACCESS”: MANDATORY EXPENSE“USAGE”: DISCRETIONARY EXPENSE
RURA - Fair Competition - Quality of Service - Development
Universal Access Policies
The funding of universal access support schemes oftenrequires some form of regulatory intervention.
On one hand,
Governments can impose performance requirements or levies on operators, essentially directing the pay the costsof providing universal access, either through ratemechanisms or through a special “universal access”
RURA - Fair Competition - Quality of Service - Development
Universal Access Policies
On the other hand,
Governments can provide incentives for carriers to provideuniversal access/service on their own. Some form of compensation on carriers that extend their networks or improve service is target areas.
This policy choice, between setting mandate and providingincentives, is often captured or termed as pay or play.
That is a carrier can either pay to support universal accessor undertake to provide it itself.
RURA - Fair Competition - Quality of Service - Development
Universal Access Fund- UAFPresidential Decree
• 2 % of Annual Turnover of each operator• Define Remote or Rural Areas Targets• Invite Bidders to compete• Select the best Bid• Monitor the implementation
Fund Mobilisation/ Equipment from International ICT Organs
• CDMA donated by ITU 2004-2005, Rwandatel was selected• WCDMA donated by China Government, Rwandacell 2007
Government of Rwanda commitment to build a National Broadband Infrastructure ( Fiber Optic, VSAT and Kalisimbi Project ( DVB-T applications)
RURA - Fair Competition - Quality of Service - Development
Universal Access as an opportunity ( Pay or play)
The 30 Districts constituting Rwanda trough their respective Provinces can proactively encourage communities to participate in the development of the Communications sector in their respective areas.
This understanding maturity will provide new opportunities and alternative means of financing universal Access.
RURA - Fair Competition - Quality of Service - Development
Universal Access as an opportunity ( Pay or play)
Rwanda Regulators and Policy-markers are discussing andmay borrow some of the following ideas as ways in whichuniversal access can be promoted:
* Micro-credit programmes. Bangladesh Case Study* Build, Operate and Transfer-BOT "or "Build, Transfer and Operate-BTO" Arrangements e.g. Indonesia and Thailand* Cooperatives and Community-Owned Systems.* Regional Operators. E.g. South Africa ( Under-Served Areas Licences: USALs )
RURA - Fair Competition - Quality of Service - Development
The Market Efficiency Gap and the True Access GapThe Market Efficiency Gap and the True Access Gap
Source: World Bank
RURA - Fair Competition - Quality of Service - Development
Regulatory FrameworkRegulatory FrameworkExperienceExperience
Sharing experiences in the different markets:Sharing experiences in the different markets:
CRASA (Communications Regulators Association of CRASA (Communications Regulators Association of Southern Africa)Southern Africa)
ARICEA (Association of Regulators of Information and ARICEA (Association of Regulators of Information and Communication for Eastern and Southern Africa)Communication for Eastern and Southern Africa)
WATRA (West African Telecoms Regulators Association)WATRA (West African Telecoms Regulators Association)
Etc.Etc.
RURA - Fair Competition - Quality of Service - Development
Rwanda Integrated ICTRwanda Integrated ICT--led Socioled Socio--Economic Attainment TargetEconomic Attainment Target
Universal Access/ Service• Availability• Affordability• Accessibility
DRIVERS:• Peace & Stability• Rule of law & Respect of
Property rights• Absence of Corruption• Fair-Competition
LAW & REGULATION FRAMEWORK
• Regulate terms of entry –“managed liberalisation”
• A biased framework with open access as a central mechanism
• Intervene to create arbitrage opportunities
• Remove legal barriers to invest –“full liberalisation”
• An objective framework with open access as a remedy
• Intervene to correct market failure
Access to existing investmentInvestment in new access
LIBERALISATION, COMMERCIALISATION &
PRIVITISATION
Universal Access/Service as an opportunity
("Pay or Play")
UAF for only the True Access Gap
Transparency & Predictability
RURA - Fair Competition - Quality of Service - Development
The Rwanda Communications Reform should The Rwanda Communications Reform should be an ongoing processbe an ongoing process
Law & Regulatory Framework
Policy
Economic Growth: Communications Sector Growth
Employment, GoodGovernance, GDP
UniversalAccess
Liberalisation
Commercialisation
Privitisation
RURA - Fair Competition - Quality of Service - Development
Thank you