January
2001
Slovakia
Master report
|
Slovakia Master report |
1. The interaction between business and regulatory constraints
1.1 The regulatory background
For more than 36 years, the telecommunication sector within Slovakia was regulated by the Telecom Law 1964 (with amendments in 1992, 1993 and 1995) and with several Ministerial Decrees and regulations. The previous legislations did not conveniently help in the dynamic development of telecommunications and information technologies.
Since 1993, the Ministry of Transport, Posts and Telecommunication started to prepare a new telecommunication legislation framework, which encompasses the preparation of a new Telecoms Law and Ministerial Decrees. The main objective of the new telecommunication legislation is to harmonize the European Union legislation within the Slovak Republic's laws to correlate with technological development. In July 2000, the Slovak Republic adopted a new Telecom Act (No. 195/2000). The adoption of the new Telecom Law has been directly related to the privatization process of Slovak Telecom (the main Telecom provider of Slovakia). This new legislation brought with it the creation of new institutional bodies (a single regulatory body for technical and price regulation, called the Telecommunications Office) and regulatory framework (licensing regime, tender procedures, limited resources, monopoly timing, interconnection, universal service, price regulation, new legal base for relationship between operators and customers, etc.).
At the beginning of October 2000, the new Telecom Act was amended (No.308/2000) to encompass broadcasting and re-transmission issues. The EC continues to monitor and advise, through regular reports, on the accession status of the Slovak Republic. The latest EC report recommends the Slovak Republic should further improve and better harmonize its new telecommunication legislation to EU standards and trends.
Currently, the telecommunication sector within the Slovak Republic is going through a transitional period as the new Telecom Law is being adapted with the old one. The two Laws vary in some certain aspects and as the new Law is being instigated, the cohesion of the two Laws is slowly being done in order to have a smooth transition from one to the other. Still, there are a few legislative issues that need to be adopted within the new Telecom Law for the complete adoption of all the telecommunications sectors within Slovakia.
1.2 Business constraints and entry barriers
Since 1992, terminal equipment and supporting construction activities relating to the building of telecommunication networks has been fully liberalized in Slovakia. The liberalization of telecommunication services is gradually being developed. With regards to public cellular and data packet networks, these are being operated by companies with foreign investors, since this sector has been liberalized and from 1996 two GSM licenses for GSM 900 have been issued. In 1999, licenses for GSM 1800 have also been issued to the same operators with GSM 900 licenses. The Internet in Slovakia has also undergone significant development within the liberalization market, the licensing regime and specific tariff structure.
In June 1997, the government passed a bill (government resolution No. 438/1997) liberalizing the telecommunication networks and services. This meant, that as of January 1998, alternative infrastructure networks were also liberalized to offer telecom services to third parties. Prior to this, for many years, incumbent operators (which were state owned) were allowed to develop their own telecommunication infrastructure and services. However, it was to be used internally (for their own personal use). They were not permitted to offer these services to operators outside their organization. Then in 1998, with the 438/1997 resolution that they were able to expand outside their internal realm. Since 1998, five licenses for leased lines have been issued.
The only operators who have not been allowed to be included to the public telecommunication network were Cable TV operators. Cable TV is regulated by both the National Council for Broadcasting and Retransmission (content regulation), and the Telecommunication Office (technical and price regulation). Cable TV operators are not obliged to apply for a license in case they are using their networks only for one-way distribution of radio and TV signals.
Local, long-distance and international telephony is still a monopoly, run by Slovak Telecom. This situation will exist until the end of 2002.
1.3 Attitude of the incumbent operator towards alternative network providers
Even though the telecoms market has been liberalized since January of 1998, only five licenses for leased lines services have been issued. No further development has resulted.
Slovak Telecom has maintained its high market share within the telecom services. It was a monopoly regarding to telephony for some time, however, with the passing of the 438/1997 Law, this changed the state of the market. The Antimonopoly Office has received several requests (mainly from ISPs) regarding pricing on local leased lines. Previously, Slovak Telecom was the sole provider and therefore, set the prices for local leased lines.
Long-distance leased lines are offered by Slovak telecom and by those operators who have licenses (four energy companies forming the group known as ENERGOTEL and Transtel, a subsidiary of the state petrol company Transpetrol). Slovak Telecom still holds the majority of the market share within this sector. In December 2000, The Ministry of Economy proposed the creation of a new telecom operator, based on the existing consortium group of ENERGOTEL and Transtel. However, this is still under advisement.
1.4 On-going regulatory developments concerning alternative networks
The telecommunication sector is going through a transitional period where the old Telecom Law is being diffused with the new Telecom Law. Efforts are also being made in adopting EU standards and trends to improve and harmonize both EU telecom standards and the Slovak Republic's Telecom legislation. Developments are being discussed in offering licenses for services other than leased lines. The issuing of national FWA (Network Wireless Bands for 3 GHz and 26 GHz bandwidths on point to multipoint bases) in a tender is in progress, however, still remains closed for the time being.
2. Inventory of the major "public" utilities with a potential for use in IS applications
2.1 Types of companies offering networks (gas, railway, water and draining networks, waterways, motorways, electrical networks, cable…): description, choice and strategies (alliance opportunities, vertical integration…), and customer targeting.
With the exception of Cable TV, all other sectors are being considered to be privatized. Currently, all services (electricity, gas, oil, etc) are state owned. Whether they are to go through a privatization process is under advisement. If this comes into effect, it may have a bearing on the way the current telecom sector is depicted. The effect of privatization to the companies currently holding leased lines licenses is not certain, however, some changes should arise.
2.1.1 Electricity
Four licenses for leased lines services (January 1998) have been issued to four separate electricity companies (three being regional electricity distribution companies and one national - a power plant). These four companies are state owned and have been joined to form a consortium known as ENORGOTEL. For many years, electricity companies have been able to establish their own telecom network, however, it could only be used internally. The state electricity companies are expected to be partially privatized before the end of 2002.
2.1.2 Water Network
There are several regional water distribution companies with their own limited telecom infrastructure, however, these networks could only be used internally. No interests have been expressed in starting to provide telecommunication services externally in the near future.
2.1.3 Oil
The national oil distributor, Transpetrol, established a subsidiary company called Transtel in order to apply for a leased line license from the government. Transtel was awarded this license at the beginning of 1999, but as concentrated in providing such services within its own already established telecommunications network (which is based on fiber optic cables). On December 5th, 2000, an official tender for the selection of a privatization advisor for Transpetrol was issued. Privatization procedures are going ahead for this sector.
2.1.4 Natural Gas
There is one national natural gas distributor called SPP (Slovak Gas Industry). SPP has established its own internal limited telecommunication network and is supported with modern technologies.
2.1.5 Railway
National Railway Company (called Slovak Railways - ZSR) has been able to establish an extensive telecommunication infrastructure network. In mid-November 2000, ZSR officially expressed interest to start providing telecommunication services externally in the medium-term period.
2.1.6 Cable TV
The Cable TV (CATV) sector in Slovakia is regulated by both the Telecommunications Office, and the National Council for Broadcasting and Retransmission. The sector of CATV is fully liberalized. The CATV infrastructure has been included into non-public networks. Significant power in the CATV market is held by UPC Slovensko, which owns (through several companies) the majority of the CATV networks in the whole of the Slovakian territory.
2.2 Types of operators using the networks
Those operators who are using the services provided by these incumbent entities are ISP providers, mobile operators, and other customers (data and value-added services) who want to create their own data networks or non-public telephony service for their own internal use only. The intention of these operators is to use the different types of leased line services being offered in order to increase and improve their own services portfolio to existing and potential customers.
2.3 Type of service offered by the operators on the networks
These operators concentrate on providing services such as Internet, data, value-added, mobile telephony to their customers using the various leased lines they have purchased (analogue, digital, wireless, wide bandwidth, single bandwidth).
|
