Communication Sector Reform:
Liberalisation,
Law and Regulation
and Universal Service policy
in Rwanda.
Col D. Mudenge Eng. MCM ,
Vice-Chairperson Regulatory Board &
Ag Director General - RURA
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Introduction
The Rwanda, being one of Africa’s smallest
Countries, is no doubt the smallest country in
East and Central Africa.
It has enjoyed a period of stability and democratic
infrastructure set up for over twelve years since its
1994 Genocide Aftermath.
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Introduction
Unlike Asian countries, Rwanda like other SubSaharan countries is still striving to translate the
benefits of its small size, stability, security and the
unprecedented clear political support from the top
leadership and the expected benefits of the
Communication sector into a real national growth.
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Introduction
The overall objective of this presentation is to highlight key
steps of Rwanda Communication Sector Reform through :
a. Liberalisation and Commercial Environment
structure ensuring effective and workable ICT Policy
implementation;
b. Establishment of laws and Regulation framework of
the ICT policy that respond to the Government vision
2020 perspective;
c. Establishment of Universal Access Policy
implementation (required) outputs that shall contribute
towards the poverty alleviation efforts and thereby
enhancing economic development.
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WHY A VISION ?
All things are created Twice !
“Begin with end in mind is based on the
principle that all things are created twice.
There‘s a mental or first creation and a
physical or second creation to all things.“
Stephen R. Covey
The 7 Habits of Highly Effective People
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Communication Sector Reform: Liberalisation,
Law and Regulation and Universal Service
Policy in Rwanda.
Digital
Digital
Divide
Divide
Universal
Access
Universal
Access
Law
and
Regulatory
Law
and
Regulatory
Framework
Framework
Liberalisation,
Liberalisation,Commercialisation
Commercialisationand
and
Privatisation
Privatisation
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The Role of Communications' Sector
Reform in achieving a competitive
liberalised market environment:
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The Digital Divide
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The Digital Divide
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Benefits from full and open competition
of Communications Sector
Efficient
Regulation:
Greater transparency
and predictability
Digital Divide Reduces:
Society benefit
From new
applications for
health, education etc.
Fair &
efficient
Competition:
Consumer savings/
Lower prices.
Many Operators:
benefit from increased
demand
Economic performance/
Economic Stimulus.
Economies expand (GDP),
Gvt benefit From
increased tax
revenues
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Workers benefit
from increased
Employment/Jobs.
PEST ANALYSIS
• Status of government
• Priorities: provision of basic services, job
creation, poverty elimination, growth
Political
• Importance of corporate citizenship
Stable
• Greater focus on governance and
Full Support
corruption eradication : e-gov
•
•
•
•
Status of competitive environment
Status of economy;
Rate of inflation
Economic
Uncertainty regarding the impact of oil
Steady progress prices and exchange rates continue
• Pricing models and operational systems
are complicated
• Growing middle-class with
growing potential uptake of
Communications
operators’ services
Social
Significant impact• HIV/Aids has a significant impact
Reform
on society with uncertainty about
long-term effects e.g. labour,
• Deregulation of industry through
healthcare etc.
changes in legislation
• Growing poverty in certain areas
Technology
• Uncertainty re regulation of new
• Evolution of media space
New Challenges
players and their participation in the
• E-school
market
• Rapid change and growth in complexity with many new players in the market
• Convergence of technologies and industries
• Uncertain
consumer uptake of new technologies, readiness and overload
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• Innovations
to influence
profitability
Service
- Development
Laws and Regulation framework:
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Laws and Regulation framework:
•
•
•
RURA Law ( Convergence issue)
Telecom Law > < ICT Law in preparation
Competition Law
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Laws and Regulation framework:
Rwanda has integrated the East African
Community.
In order to harmonise with East Africa Regulatory
Framework, Rwanda needs urgently to work with
others member states for the harmonisations of
following issues, Summarised in form of questions
as follows :
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Does the regulatory framework facilitate the provision of
different services over different platforms (e.g., technology
Neutrality…) ?
„
„
Does the regulatory framework support full competition?
Does the regulatory framework allow service providers to
offer multiple services?
„
What are the regulatory policies for these new technologies
and services with regard to numbering, spectrum, universal
service, and interconnection?
„
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Does the EAC Countries’ legal framework contain the necessary
legislation to support an ICT environment (e.g., intellectual
property laws, computer crime, electronic transactions, data privacy
and security)?
„
How much turn-around time and process is required for the
EAC Countries’ legal framework to respond to future changes in the
sector?
„
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Reforms in Communications:
Law and Regulatory perspective
The primary purpose of reform is :
To get more consumers with better, new, and less costly
services.
To Address and Accommodate Pressures from ICT
„
Liberalised Market :
„
incumbents who want ongoing protection,
„ new entrants seeking special deals/considerations or help
( e.g. Right of ways, Interconnection agreement, …)
„
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Example of An Effective Regulator
„
An effective regulator is
„ Adequately funded. (GBP 164m p.a. for
OFCOM)
„ Effectively skilled
„ Works in the best interest of the consumer
„ Creates a level playing field
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Key Issues in Regulatory Establishment
„
„
„
„
„
„
„
Policy and Legal framework
Functions and Role of Agency
Institutional and governance framework
Funding
Independence
Lead time and Reform Implementation
Transparency, Predictability & Flexibility
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POLICY MAKER:
MININFRA
A Direct Hand
Consumers/
Gvt Agencies
No Competition : Low QoS
No Choice
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Rwandatel
MTN-Rwandacell/
POLICY MAKER:
MININFRA
Still
A Semi Direct
Hand
RURA
Consumers/
Consumer
Associations
No Competition : Low QoS
No Choice
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Terracom-Rwandatel
MTN-Rwandacell/
Artel/Altech , ISPs
Broadcasting & Other
Media
POLICY MAKER:
MININFRA
RURA
Consumers/
Consumer
Associations
Rwandatel
MTN-Rwandacell/
Artel/ ISPs
Fair Competition : High QoS
Broadcasting & Other
ICT Media
Many /Multiple Choices
Tariffs : More & more decrease
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The role of Communications' Sector Reform
in Achieving Universal Access
in a competitive environment
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Overview of Universal Access and Universal Service
The terms universal access and universal service are often
used interchangeably, because of their similar meanings, but
the difference between the two terms is more than a nuance.
Universal service means that every household in the country
has telephone service – traditionally, a fixed-line phone for
every household.
This is a practical policy objective in many developed
countries, but in most developing market countries, it is only
a long term goal.
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Overview of Universal Access and Universal Service
While universal service may be a realistic policy objective in
developed countries, universal access is a more feasible practical goal
in many developing countries.
Universal access policies seek to increase access to telecom services
on a shared basis, such as on a community or village-wide level.
Universal access programs typically promote the installation of
public payphones or public call offices in rural and remote villages or
low-income urban areas with the aim of providing a basic and initial
connection to the telecommunications network.
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Rural V Urban Economics Funds?
„
Urban Site
• Rural Site
Costs
– Costs
„
„
„
„
„
Power Grid?
Local Transmission to
switch
Easy to reach for site
engineers
Mostly outgoing calls
„
„
„
– Especially on satellite
• Costly to maintain
– Revenue
Revenue
„
• High Fuel Cost
• High Transmission Cost
Uneconomic if
interconnect is high
High site utilisation
Distribution relatively
easy
• Mostly incoming calls
– Uneconomic if
interconnect is low
• Low site utilisation
• Distribution is difficult
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Focus on the end user Terminals
Handsets and Computers…
WLAN, LAN
Balance!!!
DSL, Cable TV
PAN
Bluetooth
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GSM/WCDMA/
CDMA2000
CDMA EVDO
ACCESS IN DEVELOPING MARKETS IS ABOUT THE
COST OF ACCESS, NOT USAGE PRICES
To him, the barrier to get connected to mobile is…
1. How much to join?
2. How much to stay connected?
3. How much to use?
IN THAT ORDER !!!
“ACCESS”:
MANDATORY EXPENSE
“USAGE”:
DISCRETIONARY EXPENSE
The “affordability” barrier for the poorest is:
• cost of phones and SIM packs
• any minimum spend requirement to remain connected, then
• the price of making calls (and even then, compare this to the cost
of a trip to town!)
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The focus should be cost ofService
access
& End User Terminal Handset !
- Development
Universal Access Policies
The funding of universal access support schemes often
requires some form of regulatory intervention.
On one hand,
Governments can impose performance requirements or
levies on operators, essentially directing the pay the costs
of providing universal access, either through rate
mechanisms or through a special “universal access”
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Universal Access Policies
On the other hand,
Governments can provide incentives for carriers to provide
universal access/service on their own. Some form of
compensation on carriers that extend their networks or
improve service is target areas.
This policy choice, between setting mandate and providing
incentives, is often captured or termed as pay or play.
That is a carrier can either pay to support universal access
or undertake to provide it itself.
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Universal Access Fund- UAF
Presidential Decree
•
•
•
•
•
2 % of Annual Turnover of each operator
Define Remote or Rural Areas Targets
Invite Bidders to compete
Select the best Bid
Monitor the implementation
Fund Mobilisation/ Equipment from International ICT Organs
•
•
CDMA donated by ITU 2004-2005, Rwandatel was selected
WCDMA donated by China Government, Rwandacell 2007
Government of Rwanda commitment to build a National Broadband
Infrastructure ( Fiber Optic, VSAT and Kalisimbi Project ( DVB-T
applications)
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Universal Access as an opportunity ( Pay or play)
The 30 Districts constituting
Rwanda trough their respective
Provinces can proactively
encourage communities to
participate in the development
of the Communications sector
in their respective areas.
This understanding maturity
will provide new opportunities
and alternative means of
financing universal Access.
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Universal Access as an opportunity
( Pay or play)
Rwanda Regulators and Policy-markers are discussing and
may borrow some of the following ideas as ways in which
universal access can be promoted:
* Micro-credit programmes. Bangladesh Case Study
* Build, Operate and Transfer-BOT "or "Build,
Transfer and Operate-BTO" Arrangements e.g.
Indonesia and Thailand
* Cooperatives and Community-Owned Systems.
* Regional Operators. E.g. South Africa ( Under-
Served Areas Licences: USALs )
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The Market Efficiency Gap and the True Access Gap
Source: World Bank
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Regulatory Framework
Experience
„
Sharing experiences in the different markets:
„
CRASA (Communications Regulators Association of
Southern Africa)
„
ARICEA (Association of Regulators of Information and
Communication for Eastern and Southern Africa)
„
WATRA (West African Telecoms Regulators Association)
„
Etc.
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Rwanda Integrated ICT-led SocioEconomic Attainment Target
Universal Access/Service
as an opportunity
("Pay or Play")
Universal Access/ Service
• Availability
• Affordability
• Accessibility
LIBERALISATION,
COMMERCIALISATION &
PRIVITISATION
DRIVERS:
• Peace & Stability
• Rule of law & Respect of
Property rights
• Absence of Corruption
• Fair-Competition
• Remove legal barriers to invest –
“full liberalisation”
• An objective framework with
open access as a remedy
• Intervene to correct market
failure
Investment in new access
Transparency
& Predictability
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UAF for only
the True Access
Gap
LAW & REGULATION
FRAMEWORK
• Regulate terms of entry –
“managed liberalisation”
• A biased framework with open
access as a central mechanism
• Intervene to create arbitrage
opportunities
Access to existing investment
The Rwanda Communications Reform should
be an ongoing process
Law & Regulatory
Framework
Policy
Liberalisation
Universal
Access
Commercialisation
Privitisation
Economic Growth:
Communications
Sector Growth
Employment, Good
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Governance,
ServiceGDP
- Development
Thank you
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