January 2000

Malta Update Memo

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

This update covers new developments that took place in the area of Cable TV over the period under consideration. No plans have been announced by any of the utilities to set up their own telecommunications networks during this period.

1. Introduction

As one would have expected, no new alternative telecommunications networks were announced by any of the utility companies during the past months. The main contributing factors were outlined in the master report. The main ones being that they are being provided with a good service by the existing operators and that they would rather concentrate their efforts on improving their core business services.

2. Cable Internet developments

Further developments related to the provision of Internet service over the cable TV infrastructure have been reported by Melita Cable p.l.c. A demonstration of Cable Internet has been one of the main attractions at the annual fair of Information Technology & Telecommunications. Pilot field-testing had already been carried out and it is understood that it was technically successful.

Internet Service Providers (ISPs) reacted to the announcement and called for some form of regulations to enable a level playing field for all Internet providers. As a result, new telecommunications regulations have been issued by the Regulator whereby the CATV Company has been obliged to allow ISPs to make use of its network. In this respect the company had to provide access costs to ISPs.

The new regulations also stated that a company could only provide Internet access through one subsidiary company. One of the Internet service providers stated in the local press that the new regulations gave equal footing but some areas had to be discussed further. He continued that anyone offering Internet access had to be in possession of a license. Licensing fees were also published with associated regulations.

Maltacom p.l.c. reacted to the announcement that Melita Cable will be launching Cable Internet, primarily because the former still has a license to operate as the sole telecommunications provider. This has been manifested with strong statements issued by both companies. Maltacom claims that Melita Cable does not have the license to provide data services over its CATV network. Melita Cable refutes this.

The CATV Company will not be providing Cable Internet for the time being but it is understood that it is upgrading its infrastructure and further developments are expected in the coming months.