ESIS extension - Turkey - Alternative Networks

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

Some developments took place during this period with the initiation of the implementation of the new telecom law. These include the granting the third GSM license, the establishment of VPNs operated by private companies and the establishment of cable Internet. On the other hand, ULAKNET, the network of academic institutions and research organisations, still remains the sole alternative network in Turkey.

As stated in the previous reports, Turk Telekom, which is currently 100% state owned, has a monopoly status on the infrastructure ownership and operation of telecom networks in the country. Thus Turk Telekom owns and operates the conventional telephony network, the Internet backbone, the cable TV network and the communication satellites TURKSAT 1B and TURKSAT 1C.

Very recently a new telecommunication law was enacted to liberalise the telecom market in Turkey. With the new law, 49% of Turk Telekom is to be sold. The law requires the monopoly status of Turk Telekom be ended by the end of year 2003. It also liberalises data services to a larger extend and relaxes some requirements in licensing procedures. The law also establishes an independent body for telecom regulation.

Turk Telekom has the right to establish joint ventures with other public organisations or private companies to build or to operate telecom infrastructure and to provide telecom services on a revenue sharing basis. On the other hand, the new telecom law allows licensing of many services to private organisations, including data services, VSAT services, cable Internet. It also allows private organisations operate VPNs over the Turk Telekom owned Internet backbone TTNet.

Implementation of the new telecom law is currently under way. The president and the members of the independent regulation authority were appointed in this period. A tender was called for licensing the third and the forth GSM networks and the third GSM network license was granted to Isbank-Telecom Italia consortium. A new tenter will be called this year for the forth GSM network. 20% of the shares of Turk Telekom is planned to be privatised this year.

Digital TV and cable Internet have started and expanding. Aside from Digiturk, the digital TV company established in the previous period, a new company called Star Digital was established in this period. Similarly, two new companies Ultra in the Asian side of Istanbul and Interactive in Ankara entered the cable Internet. The previously established cable Internet company Kablonet operates in several major cities including Istanbul, Ankara and Izmir. The total number of cable Internet subscription is currently 1200.

Some VPN were also established in this period, the biggest one being KocNet, which is operated by KocSystem, the IT company of Koc Group.

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.