Communications Market Opportunities in Kiribati in Order to Draw Investors’ Attention to the Business Opportunities Offered by Our Country
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We at the Communications Commission of Kiribati (CCK) are publishing this Communications Opportunities in Kiribati as we advance through our second year of operation in order to draw investors’ attention to the business opportunities offered by our country. Although Kiribati is one of the World’s most isolated nations with relatively low income levels, there are real commercial opportunities in the communications sector. Demand for services from businesses, the Government, international organisations and the public and is unmet and growing fast. Penetration of mobile services is only 17% and Internet usage is low due to limited access points and the high costs of service. Physically, the market is not challenging to address as about 65,000 people live on or within microwave link distance of Kiribati’s economic centre, South Tarawa. As these pages show, even our more remote islands offer feasible business opportunities. The CCK has developed its regulatory framework to make it easy to understand, in line with international best practices and to facilitate market entry. Our licencing framework allows investors to choose where they will invest , the services they want to provide, and what technology they want to use. They are not obligated to build networks in areas they COMMUNICATIONSprefer not to cover, and the MARKE greater the populationT they cover with public mobile September 2015 communications services, the lower the licence fee that will apply. OPPORTUNITIESWhether you are an INinternational KIRIBATI telecom operator or a local Kiribati family business looking to get into the telecommunications business, we invite you to consider the investment opportunities presented here and to find your home in our growing market. This booklet is the product of work funded with the assistance of the World Bank. We thank the World Bank, which has supported and guided Kiribati as we introduced the Communications Act 2012, set up the CCK, and began issuing licences and rules. This booklet is not a business plan. It does not promise that an investor will succeed. The CCK does not guarantee the financial estimates or even the business opportunities as described. Interested investors will need to do their own due diligence to assess and confirm the market opportunities presented. However, we hope that this booklet encourages the investment community both here and abroad to consider business opportunities in our communications sector. Tangitang Kaureata, Chairman, CCK 1 | P a g e Foreword The Communications Commission of Kiribati (CCK) is publishing this Communications Market Opportunities in Kiribati in order to draw investors’ attention to the business opportunities offered by our country. Although Kiribati is one of the World’s most isolated nations with relatively low income levels, there are real commercial opportunities in the communications sector. Demand for services from businesses, the Government, international organisations and the public is unmet and growing fast. Penetration of mobile services is only about 17% and Internet usage is low due to limited access points and the high costs of service. Physically, much of the market is not challenging to address as about 65,000 people live on or within microwave link distance of Kiribati’s economic centre, South Tarawa. As these pages show, even our more remote islands offer feasible business opportunities. The CCK has developed its regulatory framework to make it easy to understand, in line with international best practices and to facilitate market entry. Our licencing framework allows investors to choose where they will invest, the services they want to provide, and what technology they want to use. They are not obligated to build networks in areas they prefer not to cover, and the greater the population they cover with public mobile communications services, the lower the licence fee that will apply. The solution under consideration for reaching Outer Islands that are uneconomic to serve is a public private partnership with the telecom operators, supported by public investment. Whether you are an international telecom operator or a local Kiribati family business looking to get into the telecommunications business, we invite you to consider the investment opportunities presented here and to find your home in our growing market. This booklet is the product of work funded with the assistance of the World Bank. We thank the World Bank, which has supported and guided Kiribati as we introduced the Communications Act 2012, set up the CCK, and began issuing licences and rules. This booklet is not a business plan. It does not promise that an investor will succeed. The CCK does not guarantee the business opportunities it describes. Interested investors will need to do their own due diligence to assess these. However, we hope that this booklet encourages the investment community both here and abroad to consider business opportunities in our communications sector. Tangitang Kaureata, Chairman, CCK 2 | P a g e Table of Contents Foreword ................................................................................................................................ 2 Table of Contents ................................................................................................................... 3 Table of Figures ...................................................................................................................... 5 Table of Tables ....................................................................................................................... 6 INTRODUCTION .......................................................................................................................... 7 A concentrated and underserved market .............................................................................. 7 Limited competition ............................................................................................................... 8 International connectivity ...................................................................................................... 8 Simple and low cost licensing ................................................................................................. 9 Market oriented regulation .................................................................................................... 9 OVERVIEW OF KIRIBATI ............................................................................................................ 10 Political system ..................................................................................................................... 10 Geography ............................................................................................................................ 11 Population ............................................................................................................................ 14 Economy ............................................................................................................................... 16 Development projects .......................................................................................................... 19 Foreign investment, taxation, laws and business registration ............................................. 23 TELECOMMUNICATIONS REGULATION .................................................................................... 25 National ICT Policy ................................................................................................................ 25 Communications Act 2012 ................................................................................................... 26 Communications Commission of Kiribati (CCK).................................................................... 27 Communications licences ..................................................................................................... 27 Licence fees .......................................................................................................................... 27 Radiocommunications licences ............................................................................................ 28 Enabling interconnection and access ................................................................................... 29 Prohibition of anticompetitive practices .............................................................................. 30 Consumer protection and pricing regulation ....................................................................... 30 Outer Islands infrastructure PPP and universal access ........................................................ 30 Appeals ................................................................................................................................. 31 Foreign investment and local licensing exemptions ............................................................ 31 THE TELECOMMUNICATIONS MARKET .................................................................................... 32 Introduction ......................................................................................................................... 32 ATHKL’s services and infrastructure ..................................................................................... 32 3 | P a g e Other players ........................................................................................................................ 35 BUSINESS OPPORTUNITIES ....................................................................................................... 39 Introduction