INTERNET OWNERSHIP in GEORGIA Author: Salome Tsetskhladze

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INTERNET OWNERSHIP in GEORGIA Author: Salome Tsetskhladze INTERNET OWNERSHIP IN GEORGIA Author: Salome Tsetskhladze Contributor: Rusa Machaidze Co-author and research supervisor: Mamuka Andguladze The publication was prepared with the financial support of the Norwegian Ministry of Foreign Affairs. Transparency International Georgia bears the sole responsibility for the content of this report. The views expressed in this publication do not necessarily reflect the views of the Norwegian Ministry of Foreign Affairs. CONTENTS Introduction _________________________________________________________ 4 Overview ___________________________________________________________ 5 Protection of Personal Data _______________________________________ 10 Open Net Project ___________________________________________________ 11 What the project involved ____________________________________________ 11 Project Funding ______________________________________________________ 12 Market Oligopoly and Largest Internet Operators _______________ 14 Ownership of Internet Operators ________________________________ 19 Magticom ____________________________________________________________ 20 Silknet ______________________________________________________________ 20 Akhali Kselebi ______________________________________________________ 22 Skytel _______________________________________________________________ 23 Georgianairlink ______________________________________________________ 24 Global Erti ___________________________________________________________ 25 Ordunet ______________________________________________________________ 25 Trialeti-Net ____________________________________________________________ 25 Mobile Internet _____________________________________________________ 26 Veon Georgia _________________________________________________________ 27 INTRODUCTION The importance of the Internet as a means of daily communication and a source of information is growing rapidly. The number of Internet users is rising and, consequently, so is the size of the Internet industry. The information obtained from the Internet becomes particularly important during electoral campaigns and could even play a decisive role against the background of the growing threat of disinformation and a low level of media literacy. In late 2019, popular social network Facebook shut down some 400 Georgian pages, groups, and accounts. According to Facebook, those pages were linked with the government and served the purpose of attacking its opponents and discrediting them.1 Due to the strong public interest, Transparency International Georgia examined the ownership of the large operators in the fixed and mobile Internet markets and their business connections. The study also reviews the question of the population’s access to the Internet. The report is based on the data published on the websites of the business registry and the Georgian National Communications Commission (GNCC), international studies, public information requested by Transparency International Georgia, and other types of open source data. 1 Removing Coordinated Inauthentic Behavior From Georgia, Vietnam and the US, 20.12.2019, http://bit.ly/2GnMKkm 4 OVERVIEW According to the Constitution, the right to access and freely use the Internet is a fundamental freedom.2 The number of Internet users has grown every year and, consequently, the importance and influence of the Internet have been rising too. According to the GNCC’s September 2019 data, the number of Internet subscribers has risen above 930,000.3 Chart 1 Nuber of Internet Subscribers 01-01 hsical persons Legal persons 1000000 00 191 800000 459 494 5 095 600000 50 400000 200000 99 9900 19 404 411 4040 4400 0 01 014 015 01 01 01 019 *September Source: The GNCC analytical website The number who use the Internet at least once a month has risen by 13 percentage points since 2015, while the number of those who do not use the Internet at all has dropped by six percentage points.4 2 Constitution of Georgia, Article 17, Paragraph 4, http://bit.ly/2IjggZv 3 All types of technology are included. The number of subscribers includes both physical and legal persons. 4 Public Attitudes in Georgia. NDI surveys are conducted with financial support from Uk Aid and are carried out by CRRC Georgia. 5 Chart Internet sage At least one a week Less oten eer 80 70 4 5 4 4 1 0 62 60 5 5 5 51 51 5 50 4 37 36 4 40 4 32 32 41 1 0 9 0 0 30 28 28 20 1 1 1 10 10 10 11 9 10 7 6 7 7 8 6 0 Aug o. Mar un o. Apr un ec Mar un ec Apr ul o. 015 01 01 01 019 Source: NDI/CRRC A steadily growing number of individuals use the Internet as a source of information. 6 Chart Internet as a Main Source of Inforation Primar source Secondar source 5 5 5 25 4 22 1 4 0 20 1 1 1 15 14 10 7 7 5 014 015 01 01 01 019 019 April April une April March April ecember Source: NDI/CRRC According to the National Statistics Office of Georgia,5 96% of the population uses the Internet in order to access social networks, while 55.4% uses it to read online news, newspapers, and magazines. While 69.6% of the households have Internet access,6 64% of the individuals use the Internet. 5 Distribution of the population aged 15 and older in terms of the purpose of internet use. Those who had used the internet over the preceding three months are included. National Statistics Office of Georgia, July 2019, http://bit.ly/2PKnfyX 6 Freedom on the Net, Freedom House, http://bit.ly/2WRt5kb 7 Chart Indivuduals Internet use by year 80 70 4 59 60 55 4 50 4 44 9 40 15 30 9 01 20 10 5 8.3 10 9 1 05 1 1 2.6 0 000 001 00 00 004 005 00 00 00 009 010 011 01 01 014 015 01 01 01 Source: ITU Analysis of the data clearly demonstrates that the Internet is more accessible to urban population compared with rural residents. According to the National Statistics office,7 70.6% of the population has accessed the Internet over the last three months: The figure is 78.8% in cities but is 20 percentage points lower in rural areas -- 58.6%. It should be noted that 28.2% of the people have never used the Internet. 7 Distribution of the population aged six and older in terms of the last use of the internet over the preceding three months. The National Statistics office of Georgia, July 2019,http://bit.ly/2PKnfyX 8 Chart Distribution of Population ased on Last se of Internet Total rban Rural 80 78.8 51 1 04 0 70 4 59 60 55 5 49 50 451 44 40 01 01 01 019 Source: The Georgian National Statistics Office of Georgia8 According to the GNCC, only 50% of Georgia’s 3,388 villages have at least one subscriber using the Internet.9 According to the 2019 Freedom on the Net report, Georgia ranks among free countries with the score of 75 out of 100.10 The report notes positively the fact that the government does not restrict social networks or means of communication. However, the same report points to a number of problems which represent a serious challenge for the Georgian Internet: specifically, cases of self-censorship among civil servants and online journalists. According to the report, pro-government websites actively disseminate disinformation which aims to influence the population. Recently, Transparency International Georgia has also spoken extensively about the problem of government-backed attacks on its opponents in social media. Our findings were confirmed when Facebook remove hundreds of pages linked with Georgian Dream.11 8 Distribution of the population aged six and older in terms of the last use of the internet over the preceding three months. National Statistics Office of Georgia, July 2019,http://bit.ly/2PKnfyX 9 The GNCC 2018 report, http://gncc.ge/uploads/other/4/4120.pdf 10 Freedom on the Net, Freedom House, http://bit.ly/2WRt5kb 11 Facebook Removes Hundreds of Georgia Govt Linked Pages for ‘Coordinated Inauthentic Behavior’, www.civil.ge, 21.12.2019, https://civil.ge/archives/332443 9 PROTECTION OF PERSONAL DATA According to the current law,12 the personal data of Internet users is not protected -- among other things, from secret surveillance. Specifically, legal entity of public law (LEPL) Georgian Operative-Technical Agency which is subordinated to the State Security Service is authorized to install in electronic communications companies (which include Internet service providers and mobile communications operators) stationary, non-stationary, and semi-stationary equipment allowing it to have real- time access to identifying data bases, such as the time, duration, and location of a conversation, the Internet pages visited by a user, and so on. The agency stores this data in its own bank and subsequently uses it for investigation and security-related purposes. Through the installed equipment, the agency can also have direct access to the content of the users’ conversations, electronic correspondence, and so on. The equipment is produced, installed, and controlled by the State Security Service, allowing it to conduct secret surveillance without judicial oversight. According to the law, although the means of direct access to information ­­- the so-called black box is installed at a company’s premises, the latter has no information as to the types of data obtained by the Operative-Technical Agency which is part of the security system. The agency can store the data for up to a year, although the period can be extended too. Civil society organizations actively tries to change the law since 2013. Following the “This Affects You, They Are Eavesdropping on Us Again” campaign, the Parliament adopted several progressive amendments to the laws regulating secret surveillance in August 2014, which resulted in improvements in the legislation. However,
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