ESIS extension / Estonia / Alternative Networks / Update Memo 6

The following report outlines new developments in the past three months and the state of on-going developments.

There have been several important developments in Estonian alternative infrastructure market. The liberalisation of the telecommunications market is expected and related steps are taken: National Communications Board has issued new operator codes and activity licenses for service provision, etc. Changes in ownership continue also. Developments of the last three months are analysed more thoroughly in 2.4.

Alternative infrastructure in the meaning of this document is telecommunications infrastructure owned by companies for whom provision of communication services is not the main activity, but rather only contributes to the main activity. Such companies can be companies of power engineering, railroads, road maintenance, etc. Alternative communications networks are also deemed to mean telecommunications networks owned by organisations that do not use public communications networks for some reasons (security, price, etc).

The role of alternative networks in Estonia has been insignificant. It follows from the facts that during 1940 – 1991 Estonia was a part of the Soviet Union and the national communications networks were part of the Soviet networks. Also, the prices for telecommunication services were fixed by the State. There was no possibility to build and operate alternative networks. After regaining independence on August 20, 1991 the Estonian telecommunications market started to develop rapidly and by year 2001 (with expiration of the exclusive rights granted to Estonian Telephone Company) the market should be completely liberalised. Consequently, operating in the telecommunications market (incl. operating alternative networks) is at the moment discouraged both by the existing legalisation and by rapid technological advancements. This is causing enterprises to be on awaiting position, as the positive and negative aspects of the technology of telecommunication services they are operating are not clear in the context of long-run developments.

This report covers the following companies offering public services and/or owning public infrastructure that are or could be active in the telecommunications market:

Developments of 1999 and the first half of 2000 can be briefly summarised as follows:

The main factor influencing the Estonian telecommunications market has been the Concession Agreement signed in 1992 which granted exclusive rights to ETC for eight years (till 01.01.2001) to provide basic services (national and international switched fixed voice telephony services, telex and telegraphic services, their installation and interconnecting to them).

The main law regulating the field is the Telecommunications Act with which the State intends to create favourable conditions for the development of telecommunications and to promote free competition.

The term ‘alternative networks’ is not explicitly used, although the Act regulates the field.

(1) Telecommunication service is the transmission or routing of signals of telecommunications network or telecommunications networks and the establishment of connections between termination points of a telecommunications network or telecommunications networks. Telecommunications services do not include broadcasting.

(2) For the purposes of this Act, a telecommunication service is public if it is accessible to all users on equal basis.

The second important law is the Cable Distribution Act that regulates the terms of deployment and conditions of operation of cable networks, and the provision of cable television services and telecommunication services by cable operators. The Cable Distribution Act came into effect on June 1, 1999.

(1) For the purposes of this Act, "cable distribution" means the transmission of television or radio programmes to subscribers through cable networks.

(2) For the purposes of this Act, "cable network" means a technical infrastructure used for the transmission of programmes to subscribers.

The Act also regulates the provision of telecommunication services via cable networks. Telecommunication service has been defined as follows (§ 11):

(1) "Telecommunication service" means services consisting wholly or mainly in the transmission of signals on a telecommunications network, and the creation of connections between the telecommunications network termination points.

(2) "Telephone service" means a telecommunications service, which provides users with a connection with a telephone network, and allows the transmission of calls in real time between the termination points of the network.

A public telecommunications network can be operated and a public telecommunication service may be provided by an entrepreneur that has the respective authorisation from the state. In case an owner of alternative communications networks wants to provide a telecommunication service to another enterprise, the operating licence is not required, unless there is a connection with a public communications network. At the same time provision of a large part of telecommunication services has been currently established as an exclusive right of AS Eesti Telefon and the markets will open on January 1, 2001.

The main entry barrier discouraging operating in telecommunications market (including provision of telecom services through alternative networks) is the Concession Agreement. It granted exclusive rights in the provision of basic services (national and international switched fixed voice telephony services, telex and telegraphic services, their installation and interconnecting to them) to AS Eesti Telefon.

The concession holder shall, on terms and conditions to be agreed between the concession holder and the party interested in interconnection, allow, facilitate and effect the interconnection to its network of the basic services and systems of other telecommunications operators, according to the Communication Act of the Republic of Estonia, and established international standards. (§ 4.12 Concession Agreement)

For building and operating a public local network a respective application has to be submitted to the concession holder that can make a subcontract on the operating of the local network. (§ 5.3)

Non-basic telecommunication services (e.g. mobile and data communication, paging services, satellite communication or value-added services) can be offered freely although a licence is needed for building and operating networks and/or if there is interconnection to the PSTN. There is competition in all of these liberalised markets.

The Cable Distribution Act (§ 12) has stipulated a conditional local monopoly established through a public tender arranged by the National Communications Board:

(1) A local government council shall determine the cable television network areas to be constructed within the territory of the local government, and shall designate the entire territory of the local government as one cable television network area, or divide the territory into several cable television network areas based on the number of potential subscribers and with the aim to provide cable distribution services within the entire territory of the local government.

(2) The Communications Board shall issue one or several cable television licences for each cable television network area on the basis of a public competition.

(3) The Communications Board shall issue one cable television licence for each cable television network area on the basis of a public competition if any applicant for the licence undertakes, in addition to the transmission of programmes, to provide the service specified in subsection 11(2) of this Act within the entire scope of the cable television network within eight months after receipt of the activity licence.

The Cable Distribution Act excludes the operation of dominant telephone network operators in the cable distribution market and there are also several other restrictions:

(1) An undertaking entered in the commercial register in Estonia which has been issued a cable television network licence pursuant to this Act may be the owner of a cable television network.

(2) The owner of a cable television network shall not be a company which accounts for more than 40 per cent of the turnover in the market of telephone services provided for in §11 of this Act with are rendered in Estonia; the owner of a cable television network shall have no economic interest in such company.

(3) For the purposes of this Act, "economic interest" provided for in subsection (2) of this section means:

The non-transferable activity licences for the duration of ten years, stipulated in the law, for the construction and operating of the cable television network are issued by the National Communications Board:

(1) "Cable television network licence" means an activity licence issued by the Communications Board which entitles the person indicated therein to construct, own and use a cable television network under the conditions specified in the licence.

The adoption of the Telecommunications Act has changed the earlier system for activity licence issuing. The entrepreneurs operating in the telecommunications market before the entry of this law into force had to submit a notice and an application for activity license to the National Communications Board by September 1, 2000. After that they have the right to continue their earlier activities till the decision of the National Communications Board. To new companies entering the market the new law shall be applied starting August 1, 2000.

To operate a public telecommunications network or a telecommunications network connected with it or with a telecommunications network located in a foreign country or to provide a telecommunication service, a person has to notify the Communications Board in writing. The information needed in the notices is stipulated in § 9 and the persons may commence after the notice has been registered in the Communications Board (§ 10).

Besides notification in certain cases the person has to obtain the license that is non-transferable and issued for a term of ten years unless the licence applicant requests a shorter term (§ 12):

(2) A licence is required for the operation of a public telecommunications network if the operation is based on:

(3) A licence is also required if a telecommunications network is interconnected with a public telecommunications network or a telecommunications network located on the territory of a foreign country.

The license will be issued not later than within six weeks after the receipt of an application according to the requirements at the Communications Board.

Besides the licence there is also the non-transferable technical authorisation licence that is granted for a specified time for the use of the limited resource of telecommunications (§ 18).

(3) The following conditions shall be established by a technical authorisation the purpose of which is:

The Communication Board decides the issue or refusal of the licence within six weeks.

The Act regulates the organisations with significant market power with special provisions. These enterprises are determined by the Communication Board, taking into account the concrete market of telecommunication services and the area. These are enterprises enjoying the exclusive right granted by the state or local government to operate in the (local) communication market and/or whose market share together with the parent undertaking or subsidiary is at least 25 per cent of the turnover of the concrete public telecommunication service market or at least 25 per cent of the traffic in the case of the interconnection service market and who do not prove that the holding of such market share does not endanger free competition. (§ 8).

As an exception, the National Communications Board can deem also an entrepreneur whose market share accounts for less than 25 % of the turnover of the particular market to be an entrepreneur with a significant market power (§ 8). The decision on entrepreneurs with a significant market power is adopted for each year by December 1 of the previous year. In case the market share of an entrepreneur accounts for at least 40% of the turnover of the market, the activities of such a company as an entrepreneur with a significant market power are regulated in addition to this act also by the Competition Act (RT I 1998, 30, 410; 1999, 89, 813).

2.3. Attitude of the incumbent operator towards alternative network providers

According to the opinion of the Estonian Telephone Company the role of alternative networks in the voice telephony market is low. Monopoly status of ETC in international phone call provision is protected by the Concession Agreement. In the data communication market the situation is different – ETC has been operating in competitive environment from the very beginning.

Eesti Energia AS, AS Eesti Gaas, AS Eesti Raudtee and others use mainly corporate networks for internal communication. At the moment, ETC has not received any official information considering their plans to extend their respective services after expiration of Concession Agreement.

By ETC it is believed, in future main competition will take place in the international long-distance calls area. Increase of competition in the data communications market is predicted also.

ETC has taken several steps in preparing for competition. It is wished to stop cross-subsidising of services with fixing new tariffs (starting October, 1). Prices of international calls are lowered up to 25% and of local calls raised by 25% on average.

Also activities are re-organised and several side actions eliminated. Number of personnel is to be diminished. Also, ETC closed some offices and gave up collecting payments itself.

2.4. Developments concerning alternative communications networks over the last three months

Pursuant to the Cable Distribution Act the National Communications Board arranges public tenders on the request of municipalities for the issue of cable television network licences.

Since the enforcement of the Cable Distribution Act over 70 cable television network licences have been issued. Most of them are temporal activity licences permitting operating of a network and becoming invalid when the cable television network is given to be operated by the winner of the public competition (see also 2.2.2.).

Pursuant to the Telecommunications Act (§105) persons willing to operate a public telecommunications network or with such or with a telecommunications network located on the territory of a foreign country interconnected telecommunications network had to register in the National Communications Board by September 1, 2000.

By that time the Communications Board received applications to operate a public fixed voice telephony network from nine enterprises; altogether 26 companies applied for registration (see also 2.2.3).

The competition in the cable distribution market in Tallinn continues. In November 1999 Starman Cable Television Ltd. (Starman Kaabeltelevisiooni AS) filed a complaint disputing the issue of a cable distribution activity licence allowing the creation of a cable television network covering entire Tallinn to Tallinn cable Television Ltd. (Tallinna Kaabeltelevisioon AS, trademark TELE2).

In the middle of August, Supreme Court Appeals Selection Committee did not approve the appeal of TELE2 and therefore stopped the extension of TELE2 cable network in Tallinn.

So the situation in the Tallinn's cable distribution market previous to the issue of a 10-year activity licence to Tallinn Cable Television Ltd. in October 1999 is restored.

Further developments depend from the outcome of the administrative dispute whether the National Communications Board issued the 10-year cable distribution licence to TELE2 lawfully or not. Also it is possible that the Cable Distribution Act will be altered since in the beginning of June the Legal Chancellor sent an inquiry to alter the Cable Distribution Act arguing, it favours monopolies and restricts actions.

Since according to Legal Chancellor Eerik-Juhan Truuväli the Cable Distribution Act contains aspects that favour monopolism and restrict actions, he sent an inquiry to the Parliament to alter the Act. Alteration proposals of the Act are worked upon and they will be in Parliament proceedings during 2000.

Alterations are made with the purpose to bring the Telecommunications Act and the Cable Distribution Act into accordance. At the moment the activities of the National Communications Board are limited by these legal confusions as well, since based on the Cable Distribution Act the Communications Board has issued regulations which later have been declared unlawful by courts.

Resultant of the opening of telephony service market for competition, starting 2001, in September the National Communications Board issued new operator codes, which permit the provision of telephony services starting January, 1 2001:

Since with entering into force of the Telecommunications Act the decrees regulating the field given by the Government and the Ministry of Transportation and Communications were annulled, more than 30 regulative acts have been approved or are in preparation, incl. radio frequency allocation plan, numbering plan, etc.

According to PriceWaterhouseCoopers, the sale consultant of major shares of AS Starman Kaabeltelevisoon the sale will take place in year 2000. In preliminary plans the sale was to take place in June/July.

At the moment ownership relations (Telia AB as the major shareholder of the company) prevent the company from participating in tenders for activity licences arranged by the National Communications Board. At the moment Starman has 10 temporary activity licences but some of these will expire soon. For example Starman could not participate in the tender of cable distribution operator in Kehra.

According to Starman the Swedish corporation NetCom AB (trademark TELE2) is interested in becoming the major shareholder in Starman.

On April 17 the Estonian Privatisation Agency proclaimed the competition for privatisation of 66 per cent of the shares of the Estonian Railway Company (ERC); it will be held as a two-staged tender with preliminary negotiations.

All four tenders were accepted into the second stage of the tender: Raudtee Erastamise Rahva AS (RER), CSX Estonia ApS, Baltic Rail Services OÜ and SJ International.

In July Tallinna Kaabeltelevisiooni AS (trademark TELE2) and AS Telset Telecommunications Group signed a pre-contracted for a purchase of shares; according to it Telset’s cable television networks located in Tallinn and Maardu covering 41.400 households will be sold to Tallinna Kaabeltelevisiooni AS. With the conclusion of the bargain the cable distribution networks of TELE2’s subsidiaries would reach 102.000 households in Estonia.

Starting August 1, all Estonian communications operators commenced using the dialling order accepted in Europe and the numeration system in accordance with international standards. After enforcement of modifications prefix 00 has to be dialled when calling to a foreign country from Estonia (instead of 8 00) and interstate prefix 0 (instead of 82 to mobile phones and 8 to fixed voice telephones).

Radiolinja Eesti announced of the intention to start providing satellite connection using special two-frequency telephones as the first Estonian mobile connections operator in co-operation with satellite communication services company Globalstar. The price of satellite call minute will be about 40 EEK (EUR 2.5). Estonian Mobile Telephone Company considered providing satellite connection service to its customers in co-operation with Irdium a couple of years ago, but Irdium (major share holder – Motorola) bankrupted because of lack of customers.

Since several companies are making preparations to enter the Estonian telecommunications market, Estonian Telephone Company is preparing itself for competition as well.

It is wished to stop cross subsiding services with fixing new tariffs (starting October 1). Prices of international calls are lowered up to 25% and of local calls raised by 25% on average.

After October 1 Estonian Telephone Company’s private customers’ monthly payment stays still below direct costs, negotiations concerning the problem are held with the Ministry of Transportation and Communications.

Considering the popularity of Internet a price concession is offered to Internet users – a bargain with no joining payment. The bargain allows using Internet dial up service during business time about 17% below the normal tariff and during the reduced tariff periods 1/3 below the normal. Since ETC is the dominant company in the field, offers for dial-up services extend to other service providers in the market (TELE2, Delfi) as well.

Data connection services of telecommunications company AS ComTrade have been reachable in 30.000 households in Tallinn through networks of cable distribution operators Kaabeltelevisiooni AS and AS STV Kaabeltelevisioon (as of August 1, 2000).

According to the Concession Agreement Estonian Telephone Company has to present a business plan to the Government of the Republic for the approval. On June 14, 2000 Estonian Telephone Company presented a revised business plan to the National Communications Board: compared to previous year the annexes of the action plan have been revised e.g. prognoses about the turnover for next years have been added.

The business plan was under discussion in the Government in August 2000 and ETC was proposed to speed up the granting of telephone applications and to freeze private customers’ monthly and joining payments during the process of re-balancing the networks. Therefore the business plan was returned to ETC for further improvements.

At the end of September 2000 Radiolinja Estonia and Eesti Energia Televõrgud announced of the intention to interconnect their telecommunications networks.

On the technical level their co-operation began in 1995 concerning transmission towers, stations and transmission. At the moment a series of tests is carried through, after these it will be possible to call Radiolinja Estonia mobile communications network’s straight from Estonian Energy’s communications network.

On September 19, 2000 Uninet Andmeside AS filed a complaint concerning Estonian Telephone Company to the National Communications Board, arguing, ETC’s price policy contains elements of discrimination: rent for leased lines to other Estonian communications operators is higher than a end service with ADSL for ETC’s final consumer.

According to the National Communications Board the investigation will be carried through during September.

3. Inventory of the major "public" utilities with a potential for use in IS applications

AS Eesti Energia is 100% state-owned energy company. It produces 97 % of Estonia’s electrical energy and with about 7500 employees is a major employer in the country. The length of airlines is 117,221 kilometres and cable lines 6,000 kilometres.

The special department, established already in 1949, is dealing with communications networks. Independently from this department an economic entity - Eesti Energia Televõrk - was established and it is operational from 1 of April, 2000. Eesti Energia Televõrk is operating the corporate network that covers the whole Estonian territory offering telecommunication services to Eesti Energia and its subsidiaries.

The corporate network covers the whole territory connecting all major energy facilities – power stations, management centres, etc. There are following technologies used:

The networks of the company are mainly used for corporate purposes. The usage area covers the telephony communication inside the company with connection to the public network of Estonian Telephone Company (29 digital stations) and data communication. The latter is used for operative data communication and transmitting the commercial data of the electricity system as well as connecting the computers of the company.

In the short-run, there are plans to develop image transfer services for operative management, security control and videoconferencing. Long-run plans are not clear at the moment but large-volume co-operation with major telecommunication operators is considered.

Eesti Energia has also announced possible entry to telecommunications market as technology to offer data communication services over the cable already exists on the market.

AS Eesti Gaas is a joint stock company in private law, based on private capital and owned by three large European gas companies - Russian OAO Gazprom (31%), German Ruhrgas AG (32%), Neste OY (10%) and smaller shareholders, among whom there are individuals as well as legal persons. The activities of AS Eesti Gaas focus on the purchase, pipeline transportation, distribution and sale of natural gas. In addition, the company is engaged with maintenance of gas systems and arrangement of construction of new ones.

The customers of AS Eesti Gaas are 130.423 residential clients, 682 commercial and public institutions, 211 industrial customers, 124 district heat generators and 6 heat and power co-generators. AS Eesti Gaas has currently 427 employees.

The corporate communication network was established during the Soviet period, when installing a communication cable along with a gas pipe was very common. Today the network is used for internal telephony and data communication with gas distribution centres.

No strategic decision has been adopted about the future of the communication lines. In the sections where the company does not use the full capabilities of the network, they are willing to rent it out. On the other hand, they rent some channels themselves from the Estonian Telephone Company, because for instance in Tallinn and also elsewhere their own network only reaches the borders of the town.

AS Eesti Raudtee is the biggest public 100% state-owned transport company. It has 4800 employees and operates 62 stations.

The field of information and communication technology is especially important for operative communications, but also for connecting to the inter-company data communications network extending to several directions all over the country. For corporate communications, both analogue and digital transmission is used. Backbones (copper and optics) and radio transmissions are used as channels. There is also connection to the public network of the Estonian Telephone Company.

The main thing considered in developing the communication system, is its stability. It is guaranteed by the inclusion of free resources and creating a possibility for parallel usage of different communication types. Free resources are created by doubling equipment (double processors in the telephone stations) or communication channels (re-routing). Both processes have already been started and are being developed actively.

The digitisation of existing channels going through communication backbones (copper) will be completed in course of 2000, so it will be possible to create a backup solution for established radio linkages and optic cables.

In the field of telecommunications co-operation with other enterprises takes place in renting out free channel volume (radio links to mobile phone operators) and providing telephone services (to companies closely related to Estonian Railways and private persons residing within a short distance from railways).

AS Eesti Veevärk is a private enterprise that has 33 shareholders, 29 of whom are local governments (most of them have a participation of ca 0.1 - 4.6 % each). Other shareholders are NEFCO (11.2%), AS Tartu Veevärk (13.2%), AS Narva Vesi (13.8%) and AS Võru Vesi. The company employs 40 people.

The company has no internal communications networks. However, the need for internal communication networks is felt since it would enable to communicate with lower costs and more operatively. There are no more concrete plans yet.

The most widespread usage of alternative communications networks takes place in the field of cable distribution. Wide-scale cable distribution in Estonia started in 1987 when the co-operative Levi (present AS Levi Kaabel) established the first cable TV network of Estonia in town Kuressaare. There was overall rapid development in Europe in this area as it was possible to receive and transmit dozens of programs with simple equipment. This development was followed in Estonia. The development of cable TV took place mainly in the Western, Central and Southern parts of Estonia where only a few TV programs transmitted by local transmitters were available in contrast to Northern Estonia.

The second leap in the Estonian cable TV market took place in 1992 when local transmitters stopped the transmission of Russian television programs. The rapid development of cable-TV networks started in Tallinn and other places in Northern Estonia where most of the Russian-speaking people reside. This was also a period of cable television piracy, as most of the established networks of Northern Estonia (including those built in Tallinn) were neither technically nor legally correctly built.

The third milestone is the adoption of the Cable Distribution Act in spring 1999 by Riigikogu, in force since June 1, 1999. This law organises the market to an important extent and establishes conditions for development.

At the same time the passed Cable Distribution Act and its enforcement have turned out to be problematic and the market situation is continuously unclear.

Estonian cable distribution operators can be divided into three categoris: Netcom AB, Telia AB and local operators.

The first group consists of the leading Scandinavian telecommunication corporation Netcom AB (trademark TELE2); its’ subsidiary Levicom Broadband OÜ operates communications networks (incl. cable TV networks) in Estonia and Lithuania.

Tallinna Kaabeltelevisiooni AS was established in 1994 and the company operates a communications network in Tallinn. In the second largest city of Estonia operates holding company’s subsidiary AS Levi Kaabel.

The second interest group in the Estonian cable-TV market is the Swedish national telecommunications company Telia AB, which through its subsidiary is the major share holder of cable television distribution operator Starman Kaabeltelevisiooni AS. According to the Cable Distributors’ Association Starman is the largest cable-TV operator accounting for 28% of the market.

At the same time Telia AB has announced its decision to sell its 60% ownership in Starman Kaabeltelevisioon AS due to the Cable Distribution Act that entered into force in June 1999 and according to which the owner of a cable TV network cannot be a company that controls more than 40% of telephony services provided in Estonia or is related with such a company through economic interests.

The third group of cable-TV operators consists of operators based on local capital. The largest of these is AS STV Kaabeltelevisioon with its subsidiaries AS TV Com and AS STV Kopli.

In several small Estonian towns the cable TV operators use conventional coax networks working in 47-230 MHz frequency bands (ca 16-18 TV channels). To develop these networks into telecommunications networks with bi-directional communications, huge investments are needed and it is still technically problematic. To some extent, the existing networks could be developed to offer Internet services via cable modems.

Most cable-TV subscribers are, however, located in Tallinn, where almost all operators are using higher frequencies (up to 862 MHz) that enable to broadcast up to 50 TV channels. The topology of the network and the technology remain the same (coax cable network) but it is technically easier and less expensive to develop these networks into two-way telecommunications networks.

AS STV Kaabeltelevisioon and Starman Kaabeltelevisiooni AS use HFC-technology (Hybrid Fibre Coax) where local coax networks are connected to main stations via fibre-optic network. The technology and topology of local networks is similar to those mentioned above except in in-house networks that are developed based on star topology that enables more easily to provide to customers different packages of TV programs.

Levicom Broadband (Tallinna Kaabeltelevisioon in Tallinn and Levi Kaabel in Tartu) uses FTTB (Fibre-To-The-Building) network structure where every house is connected with a circle topology fibre network. In-house network is star topology network, where coaxial cable with two pairs of copper lines is used to reach the clients. This enables the provision of all telecommunication services. This network is ready for offering telecommunication services and its bandwidth is much wider compared to conventional telephone network.

Company	Main shareholder	Number of completed outlets	Number of connected outlets	Market share
Starman Kaabeltelevisioon AS	Telia InfoMedia AB	102 000	45 000	27%
AS STV Kaabeltelevisioon	local *	110 000	37 000	24%
AS Levi Kaabel	Levicom Broadband OÜ (TELE2)	44 000	23 000	16%
AS Telset	local*	40 000	13 000	9%
Tallinna Kaabeltelevisiooni AS	Levicom Broadband OÜ (TELE2)	18 000	4 000	2%
Others	local*		38 000	21%
Total			160 000	100 %

There are currently no telecommunication operators using alternative communications networks to a considerable extent. Even when telecommunication services are provided through alternative communications networks, separate telecommunication operators have not been created or involved for that purpose and the companies owning alternative networks operate their own networks. Consequently there are no separate operators but sub-units of the same organisation.

In the future, involvement of telecommunication companies can be expected, as several companies surveyed stressed their willingness to involve telecommunication companies. Already first signs of such developments have occurred in the first half of 2000.

Telecommunications company AS ComTrade provides data communication services via cable distribution networks of Starman Kaabeltelevisiooni AS and AS STV Kaabeltelevisioon.

AS ComTrade went along with lowering of prices, starting October 1, 2000 it will provide leased line service (256 kB/s) aimed at home users with a competitive price.

In the Estonian telecommunication market data communication services by cable distribution operators can be mentioned briefly. Although several companies providing public services have their internal corporate networks that in principle could be used for the provision of telecommunication services, the services provided by them are small in scale.

Most cable-TV operators in Estonia provide a up to 20 TV programmes containing service. Cable operators in Tallinn and in a few small towns using higher frequencies (up to 862 MHz) provide a service containing up to 60 TV channels and up to 20 FM radio programmes. More important telecommunication service is the Internet connection provided through cable distribution.

After the exclusive rights granted to the Estonian Telephone Company by the Concession Agreement expire, the number of services should rise rapidly. Coming to the market with telephony services provision after the expiration of exclusive rights granted by the Concession Agreement has been announced by AS ComTrade, Levicom BroadBand OÜ (TELE2) and Uninet Andmeside AS. From 2001, the most important companies in the market will probably be AS Eesti Telefon, Levicom BroadBand OÜ (TELE2) and Uninet Andmeside AS.

The present report has been compiled based on the materials of news agencies BNS and ETA as well as the newspapers "Postimees", "Päevaleht" and "Äripäev", and the opinions expressed by various experts.

Please note that this report has been prepared under the sole responsibility of the ESIS II contractors.
It does not necessarily reflect the views of the Commission, nor does the Commission accept responsibility for the accuracy or completeness of information contained herein.
The ESIS Team of contractors welcomes any additional information or corrections.