ESIS Extension / Turkey / IS Promotional Activities / Update Memo 5

The most important activities in this period took place in the regulatory framework area. The third GSM license was awarded to the Isbank-Telecom Italia consortium with a price much higher than what was expected and which doubled the next highest bid. Another important activity in the regulatory framework area was the establishment of the independent telecom regulatory body, which was required by the new telecom law enacted early this year. Currently there is a debate on the establishment of a separate ministry for information and information society related issues.

A report was published by Cisco Systems on human capital shortage in the Internet and networking areas, identifying Turkey as the country that has the second most severe shortage problem after South Africa in 12 countries with a potential to transform into the new economy. The report predicts the current shortage of IT professionals in Turkey at a level of 5000 persons and it predicts that the figure will increase to over 20000 in 3 years.

Another report states that on the average 2 new IT companies were established per day in Turkey during the first three months of this year. The total number of new IT firms established in 3 months were 160 with 40 of them being Internet companies.

Many meetings were held in this period including the Second Turkish-Greek Information Society Forum and the ITU World Radiocommunication Conference.

The leading software company Logo became the first IT company in Turkey whose shares are to be traded the Istanbul Stock Exchange.

Although there is no official plans or measures to promote the provision of content in web application, there is a noticeable activity in content provision nation-wide. There are many sites providing content in tourism and culture and in administration, and there are many e-business sites ranging from e-malls to WAP portals, Internet banking, electronic newspapers, job application, education, search engines, etc. There are also some industry led promotion activities such as Best Web Awards and NetJini Contest to promote web content provision.

Another observation is that there are many initiatives to promote entrepreneurship in the IT area including Technology Development Foundation’s initiative, KOSGEB (SME Development Administration), and many private initiatives.

Some organisations and the industry started some promoting IS development and raising awareness, maybe the most important being Information Age Summit for SMEs organised by KOSGEB. This is a series panel discussions and demonstrations organised in a different city every time where solution providing companies introduce their solutions to SMEs. Other such initiatives include roadshows and panel discussion meetings organised by leading companies such as Microsoft, Oracle, KocSystem, and NGOs such as Turkish Informatics Foundation and Turkish Informatics Association.

Cable Internet and Digital TV are expanding in the country. 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 Istanbul and Interactive in Ankara entered the cable Internet, joining the previously established cable Internet company Kablonet.

Another interesting development is the increase in activities in the area of risk capital. TTGV (Turkish technology Development Foundation) established a fund for this purpose and some industrial groups and some independent initiatives are in the process of establishing incubators.

There is a debate on issuing Internet domain names. Currently domain names are issued by Middle East Technical University. Many ISS complain about the high bureaucracy and high cost of obtaining domain names. It is stated that many ISS are shifting from com.tr to com, i.e. from Turkish to US domain names.

An independent telecom regulatory body was established, as required by the new telecom law. The regulatory body is responsible for setting the general rules on tariffs, contracts and technical issues, establish tariffs and monitor them, introduce legislation for services and infrastructure and monitor the implementation, determine calculation methods and upper limits for service prices, monitor commercial companies against the legislation, introduce measures for consumer rights protection, and provide input to the Competition Council on telecom related issues.

There is a debate on establishing a new ministry responsible for information and IT related issues. A draft law has been prepared for this purpose by the IT Group in the Grand National Assembly. Some experts think that a ministry is essential for co-ordinating IT related issues and for emphasising the importance of IT and the transformation into information society. Others think that Turkey already has a high number of ministries (currently the number of ministries is 34) and that the establishment of another ministry will simply introduce more bureaucracy and will bring overhead to the economy.

A draft law was prepared to introduce some changes in the IPR law to make it more compliant with software issues.

A report was published by Cisco Systems on human capital shortage in the Internet and networking areas. The report examines the problem in 12 countries including Turkey that have a potential to transfer into the new economy. The report identifies Turkey as the country that has the second most severe shortage problem after South Africa. The report predicts the current shortage at a level of 5000 persons and it predicts that the shortage will increase to over 20000 in 3 years.

Another report states that the IT sector is very dynamic in Turkey in terms of the establishment of new IT companies. It states that on the average 2 new IT companies were established per day during the first three months of year 2000. The total number of new IT firms established in 3 months were 160 with 40 of them being Internet companies.

The first fully on line graduate program was started by the Informatics Institute of Middle East Technical University.

Many meetings were held in this period, the most important ones being ITU World Radiocommunication Conference and the Second Turkish-Greek Information Society Forum. Other meetings included a panel discussion on the draft law on the establishment of a national information security administration, a seminar on risk capital in Turkey, the Internet Week, Turkish Informatics Association’s seminar for data processing centre managers, a panel discussion on legal issues in Internet, a panel meeting on digital economy, and the BTIE 2000 IT-based Education conference.

The third GSM license was granted to the Isbank-Telecom Italia consortium for a relatively high price: 2.525 billion US dollars excluding VAT, doubling the next best bid, which was 1.350 billion US dollars excluding VAT. The forth GSM license was also planned to be awarded but postponed because there was no bid high enough to award the license. An interesting observation was that the shares of Isbank in Istanbul Stock Exchange increased immediately after the bid, with a net increase in the stock value of Isbank surpassing the difference between the first two bids (i.e. over 1 billion US dollars).

Several awards ceremonies were held in the IT area including Interpro Informatics Awards, Best Web Awards, and Informatics Media Awards.

One of the leading software companies, Logo, became the first IT company in Turkey whose shares are to be treated in Istanbul Stock Exchange. 15% of Logo shares are being traded in the stock market. Logo shares enjoyed a significant increase in the stock market, doubling the price since its entry to the market.

Work is under way to convert the Internet Higher Council into Internet Foundation. The purpose is to have more flexibility and effectiveness.

The new telecommunications law reflects partially the current national IS strategy. With this law the telecom market is being liberalised. The first major event was the establishment of an independent regulatory authority. The second major event was the licensing of the third GSM network. The forth GSM license is also to be awarded this year. Another event was the establishment of an independent regulatory telecom authority. Yet another will be the privatisation of 20% of the shares of Turk Telekom in the year 2000.

Information society related issues are gaining importance in the country. An indication of this is the current debate on the establishment of a separate ministry to be responsible for this area.

There is no official plans or measures to promote the provision of content in web application. Nevertheless, actions at ministry or administration level in the public sector and market forces in the private sector result in a noticeable activity in content provision nation-wide. There are many sites providing content in tourism and culture and in administration, and there are many e-business sites ranging from e-mails to WAP portals, Internet banking, electronic newspapers, job application, education, search engines, etc.

There are some industry led promotion activities such as Best Web Awards and NetJini Contest to promote web content provision. Another observation is that there are many initiatives to promote entrepreneurship in the IT area including Technology Development Foundation’s initiative, KOSGEB (SME Development Administration), and many private initiatives.

Another important development is in the area of Cable Internet. With the new telecom law, several companies were established in this area and the subscription level has increased to 1200 in a short time. It is expected that cable Internet will be a major alternative to the existing services provided by ISPs.

4. Other main or important tools used for promoting the IS development or raising awareness

Some organisations and the industry started some promoting IS development and raising awareness, maybe the most important being Information Age Summit for SMEs organised by KOSGEB. This is a series panel discussions and demonstrations organised in a different city every time where solution providing companies introduce their solutions to SMEs. Other such initiatives include roadshows organised by leading companies such as Microsoft, Oracle, etc. KocSystem, a leading IT company belonging to the Koc Group has started a series of panel meetings to discuss electronic government. Turkish Informatics Foundation and Hurriyet, a leading daily, started panel meeting on e-business.

Cable Internet and Digital TV are expanding in the country. 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.

Another interesting development is the increase in activities in the area of risk capital. TTGV (Turkish technology Development Foundation) established a fund of 7 million US dollars. Some industrial groups and some independent initiatives are in the process of establishing incubators.

There is a debate on issuing Internet domain names. Currently domain names are issued by Middle East Technical University. Many ISS complain about the high bureaucracy and high cost of obtaining domain names. It is stated that many ISS are shifting from .com.tr to .com, i.e. from Turkish to US domain names.

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.