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z – Short introduction

Universal Services in z Norway – Background for Universal Services

z Universal Services in Norway (and EU/)

Anders Lillehagen Telenor / Norway

Telenor

z One of the ’s 12 largest GSM operators with more than 67 million mobile subscribers worldwide z Largest mobile consolidated operations:

– 9.3 mill –Digi.Com 3.8 mill –GrameenPhone 3.7 mill –Pannon GSM 2.8 mill –Telenor Mobil 2.7 mill –Sonofon 1.3 mill

z Norway’s leading company Telenor z Largest provider of TV services to the Nordic market Short introduction z Total workforce: 22,400 people (11,300 in Norway)

Telenor’s mobile operations Record-high subscriber growth Norway Telenor Mobil 100% DTAC 40.3% Subscriber figures (in millions)

Denmark Sonofon 100% VimpelCom 29.9%

Ukraine kyivstar 56.5% One 17.5% Total Consolidated Total Pro Rata 100% Pannon 100% figures (all companies) 67.1 60.1 Digi 61.0% 52.7 45.2 62.0% 38.9 34.2 31.2 27.8 24.8 24.8 21.3 21.4 100% 18.7 19 16.9 16.5 13.2 14.3 ProMonte 100%

Sweden Telenor Mobile 100% Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005 Q2 2005

1 Background Norway Background - Norway

z Norway is a long country with large area z Hash climate (cold winters with lots of snow) z High mountains z Fjords – deep and narrow -> high building cost Country Population Per BDP Mill. square OECD=100 z Small population km Norway 4.54 140 123 –> few per switch

Sweden 8.90 197 111 z Scattered population 82.35 2306 103 –> long access lines

England 60.00 2470 103

The 16.05 3864 111 Netherlands

China 1306.31 1338 Telecommunications should be costly in Norway

Background – Background – Telecommunications market Norway and the EU

z Liberalized gradually through the 90’ – Fully opened and liberalized since 1998 z European Economic Area agreement (EEA) z Fixed networks (97-98% penetration): z Norway has implemented the EU – Telenor has a fixed network covering the whole country telecommunications framework including the US – Several other fixed network providers directive z Two nationwide mobile networks (>100% penetration) z All households have access to the network – Many have both fixed and mobile access – Many have ISDN and/or broadband access z Comparable low prices

Universal Services Universal Services Before 1998 From 1998

z Definition z and state owned – Split between USO and SSO company – Minimum set of services to all end users at an affordable price z Scope z Queue to get a phone up to the – Telephony – Directory enquiry and directories late 80’ – Public pay telephones – Disabled users z USO (telephony etc) and SSO z Mechanism z Gradual liberalization – fully – Financing of US / compensation – Telenor has not requested compensation (Provide US if not a fund) opened by 1998 – Price regulation / price cap introduced by 1998 – Normal delivery area, duty to contract and non-discrimination z Fixed network, but fixed mobile solutions in some places

2 Universal Services in EU/Europe Achievements (Norway)

z Fully liberalized and a competitive market – Real choice for end-users from various providers and services z Minimum set of services of specified quality to which all end-users have access at an affordable price in the light of specific national conditions. z All households have a telephony service (Universal Service directive – 2002/22/EC) – Choice from various providers (telecom, cable-TV and electricity companies) – Many end-users have ISDN or broadband access z Only Austria, France and Italy have implemented a compensation / z Two country wide mobile networks and several providers sharing mechanism, but the mechanism of these countries are disputed. – Pre-paid and low cost of entry to services – Many have only a z Other countries have not designated an US provider or the designated z Competing directory services provider is viewed as incurred no significant competitive disadvantage in providing the universal services. z Tailored services for disabled users z Comparable low prices (see for example OECD statistics)

“US is not an issue in Norway today”

Learning lesson Thank you …

z Available services throughout effective competition (USO is only relevant when the needs of end-users are not met by the market) z Operators and providers are motivated to provide services to Anders Lillehagen everybody when the regulatory environment is right Telenor z No technology or provider should be predetermined – Wireless technologies can be cost efficient and give fast roll-out Phone: +4791323175 – Speed of wireless solutions is fast improving E-mail: [email protected] z Low cost of entry – Mass production of terminals and equipment – Production of low cost terminals – High penetration – Pre-paid mobile (low entry and cost control) z Communication centre and village phones – Example: GrameenPhone in Bangladesh

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