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2006 Asia - Telecoms, Mobile and Broadband in Central Asia


Attention: There is an updated edition available for this report.

This report provides a comprehensive overview of the trends and developments in telecommunications, broadcasting and pay TV markets in Armenia, Azerbaijan, Bhutan, Georgia, Kazakhstan, Kyrgyzstan, Mongolia, Nepal, Tajikistan, Turkmenistan and Uzbekistan. Subjects covered include:

  • Key Statistics
  • Market and Industry Overviews
  • Regulatory Environment
  • Major Players (fixed and mobile)
  • Infrastructure
  • Mobile Voice and Data Markets
  • Internet, VoIP, IPTV
  • Broadband (FttH, DSL, cable TV, wireless)
  • Convergence and Digital Media


Armenia’s telecommunications sector has started to grow. There are over 700,000 fixed-line subscribers, together with 520,000 mobile subscribers, for a population of almost 4 million people. The level of investment in infrastructure and new services has begun to increase. There are, however, major structural issues to be addressed in the sector. Amid growing dissatisfaction over the performance of the telecoms network, in November 2004 the government reached a compromise agreement with ArmenTel, the country’s national telecom provider, to end its exclusive rights to provide GSM, satellite, and mobile radio communications services in exchange for various other concessions, including the stipulation that only one alternative mobile operator would be allowed to operate in Armenia until 2009. ArmenTel was also allowed to retain sole rights to Internet telephony and the use of fibre optic cables. Previously, ArmenTel had been granted exclusive rights to the provision of all telecommunications services in Armenia until 2013 (apart from data services). A second mobile operator launched its network in mid-2005 after the government awarded a licence to K-Telecom.

Azerbaijan is making steady progress in developing its telecommunications sector, but still faces numerous problems. Poor quality infrastructure has been a major ongoing problem. Only around half the telephone lines in the country are digital. The monopoly held by Azerbaijan’s Ministry of Communications, among other things, results in the high cost of satellite connections. As well as being a commercial operator through its role in AzTelecom, the ministry is both policy-maker and regulator for the telecoms sector in Azerbaijan. The country’s significant dependence on international funding has also made it difficult for any long-range planning in the development of the sector.

Bhutan, a country that preferred to remain isolated from the world from a long time, has very recently started to improve its telecommunications capability. To do so it has had to overcome the country’s mountainous landscape. Whilst the country had a basic connection to the outside world as early as 1974, with the introduction of trunk calls between Bhutan and India, it was not until 1999 that television, satellite dishes and Internet services started to appear. The tiny country proceeded to invest heavily - to the tune of around US$27 million - in telecommunications infrastructure between 1996 and 2002 to provide the country with a modern fixed line network. In late 2003, a mobile service was launched by Bhutan Telecom and by early 2006 was claiming almost 40,000 subscribers, to give a mobile penetration of less than 2%. Accurate statistical information on Bhutan is difficult to obtain; there is even a huge variation between sources on what the country’s population is.

Georgia, - Although steadily improving, the telecommunications infrastructure in Georgia remains outmoded and inadequate as a result of gradual under-investment over decades. However, there has been an upward trend in the country’s telecom market over the past few years, with rising revenues and increased investment in infrastructure. Mobile communication systems have become increasingly important because the fixed-line facilities provided in many places (particularly in rural and remote areas) are outdated and a mobile phone represents the only effective means of communication. In an interesting move, in April 2006, the country’s telecom regulator, the Georgian National Communications Commission, awarded a 3G mobile licence to textiles company Argotex. Further spectrum was due to be auctioned.

Kazakhstan, has a booming telecoms market that will ensure the rapid introduction of new infrastructure and the upgrade of old equipment (Just over 70% of the national network was digital in early 2006). New legislation adopted in 2004 started the liberalisation of the telecom sector and ending Kazakhtelecom’s monopoly. By April 2005, four companies had been licensed to provide international and long-distance services in competition with Kazakhtelecom and by the end of the year, over 1,000 licences had been issued for the provision of a range of telecom services. Rapid development in the mobile market has seen mobile subscribers surge from 260,000 in 2000 to over 5 million (a penetration of over 33%) in early 2006. Although Internet penetration remains low for the moment, there is increasing interest in going online.

Kyrgyzstan, While much has been done to modernise Kyrgyzstan’s telecom network, geographical conditions, a high incidence of poverty and a still developing legal and regulatory framework are key obstacles to expanding telecom operations. The good news is that the market has been opened to both foreign and domestic investors and an independent regulator has been established to oversee the sector. Full liberalisation of the market was set to be achieved by end-2006. As a consequence of this, the sector has been attracting strong foreign investment interest as well as considerable economic and technical assistance of various types. Since the start of market reforms in 1991, the national operator Kyrgyztelecom has been expanding and upgrading its outdated and poorly distributed network. In January 2006, the government approved a decision to put 77.8% of Kyrgyztelecom up for sale. The country’s second GSM network was also launched in April 2006.

Mongolia is committed to developing a more efficient telecommunications network as an integral part of its push towards a market economy. Since the mid-1990s, the Mongolian Government has carried out a series of telecom reforms leading to effective liberalisation of all market segments, partial privatisation of the fixed-line incumbent operator, Mongolia Telecom, and establishment of an independent regulatory authority. Competition is now in place for both fixed and mobile telephony, including local, long-distance, and international, Internet, VoIP, and VSATs. While the fixed-line network has been expanding slowly, the mobile phone market has undergone a remarkable boom, with the number of subscribers growing at an average rate of over 100% year-on-year. By early 2006, there were 550,000 mobile subscribers in the country, representing a penetration of around 20%, up from less than 2% penetration at the end of 2000. Several failed attempts have been made to issue a third mobile licence.

Nepal’s is among the poorest and least developed countries in the world. Amid what has been an unsettled political climate, the country has been moving steadily towards a more liberalised telecom market. Positive regulatory changes in the telecom sector have been implemented, including the incumbent telco losing its monopoly status in the market. By April 2006, over 170 operators had been authorised to provide a wide range of telecom services, including two for basic telephony and two for mobile telephony. The expansion of telephone services has not been able to keep up with the growing demand, an estimated 50% of demand for telephones remaining unmet. The biggest challenge has been in providing rural services. This area has been neglected as the level of investment over recent years fell well short of what was required. More than 60% of telephone services are concentrated in the capital Kathmandu. The ITU reported that there was a static waiting list of over 300,000 customers seeking fixed line services. As these issues were being confronted, the licensing of a relatively large number of ISPs, combined with the liberalisation of the VSAT data market, has created excellent conditions for the Internet to flourish in Nepal.

Tajikistan, s telecommunications network is arguably the least developed of all the countries that emerged from the former Soviet Union. With a telecom network that was near total collapse, the government has started the daunting task of bringing it up to modern standards. The network is tiny, providing service to a subscriber base that represents a teledensity of less than 4% coming into 2006. And, significant proportion of the Tajikistan network has not yet been converted to digital. A gradual process of liberalisation is under way and over the last decade a number of private operators have been allowed to enter the telecom market, notably in the mobile and Internet sectors. Privatisation of state-owned fixed-line operator, Tajiktelecom is expected to be achieved by 2007. Despite a more than healthy growth in the mobile sector, total fixed-line and mobile teledensity was estimated at barely 10% in early 2006.

Turkmenistan is yet another of the nations that emerged from the former Soviet Union with a relatively underdeveloped telecommunications sector. In fact, it is claimed that telecommunications services in Turkmenistan are the least developed of all the CIS countries. Poor growth in telecoms services, the slow progress in the development of the private sector and continuing state control over most economic activities have not been helpful in supporting the growth of the country’s telecommunications market. Combined fixed-line and mobile teledensity was estimated at just over 10% by end-2005. Fixed line growth has been virtually stagnant for almost a decade. Unlike most of its neighbouring countries, Turkmenistan’s mobile market, served by one private and one state-owned operator, has been slow to grow. The year 2005 provided the first signs of a more energetic mobile market. At the same time, the Internet, which is controlled by the government and access is severely restricted, has not been able to develop to any extent. Turkmenistan’s Ministry of Communications continues to be both the regulator and policy maker for the telecom sector.

Uzbekistan, has been struggling to bring its telecom system up to the standard found in developed countries. Although steadily improving, some of the telecommunications infrastructure remains outmoded and inadequate. With only 2 million fixed line telephone services at the end of 2005 for a population of almost 27 million, the national network still has 35% of equipment yet to be replaced or converted to digital. Certainly, however, the situation has been steadily improving, due largely to the government’s decision to give priority to the telecom sector. In 1996, in what was a significant move, the government started inviting foreign telecom companies to invest in Uzbekistan in their own right. This was followed by the creation in 2000 of Uzbektelekom, a holding company charged with operating the national telecommunications network. There has been an upward trend in the country’s telecom market over recent years, with rising revenues and increased investment in infrastructure. The next step in the government’s strategic program is to privatise the incumbent operator Uzbektelecom and to open the market to competition consistent with the country’s aim to join the World Trade Organization (WTO). Combined fixed-line and mobile teledensity was estimated at roughly 12% in early 2006, with the mobile sector growing at 100% per annum coming into 2006.

Note: Up to date accurate statistics are difficult to obtain for the telecom sector in many of the economies covered in this report. Where official figures are not available, we have as far as possible, provided estimates.

1. ARMENIA
1.1 Key statistics
1.2 Telecommunications market
1.2.1 Overview of Armenia’s telecom market
1.3 Regulatory environment
1.3.1 Telecommunications Law 1998
1.3.2 Unconstitutional monopoly
1.4 Fixed network operator in Armenia
1.4.1 Armenia Telephone Company (ArmenTel)
1.5 Telecommunications infrastructure
1.5.1 Local and national
1.5.2 International
1.6 Internet market
1.6.1 Overview
1.6.2 ISP market
1.7 Mobile communications
1.7.1 Overview of Armenia’s mobile market
1.7.2 Major mobile operators
1.7.3 K-Telecom (VivaCell)
2. AZERBAIJAN
2.1 Key statistics
2.2 Telecommunications market
2.2.1 Overview of Azerbaijan’s telecom market
2.3 Regulatory environment
2.3.1 Overview
2.3.2 National Communication Technologies Strategy
2.3.3 World Bank project
2.4 Fixed network operators in Azerbaijan
2.4.1 Aztelekom
2.4.2 AzEuroTel
2.4.3 Terracom Inc (Fire Telecom) - EurAsiaCom
2.5 Telecommunications infrastructure
2.5.1 National
2.5.2 International
2.6 Internet market
2.6.1 Overview
2.6.2 ISP market
2.6.3 Broadband Internet
2.7 Mobile communications
2.7.1 Overview of Azerbaijan’s mobile market
2.7.2 Major mobile operators
2.7.3 Trunk Mobile Radio (TMR)
3. BHUTAN
3.1 Key statistics
3.2 Telecommunications market
3.2.1 Overview of Bhutan’s telecom market
3.3 Regulatory environment
3.3.1 Bhutan Telecommunications Act 1999
3.4 Fixed network operator in Bhutan
3.4.1 Bhutan Telecom
3.5 Telecommunications infrastructure
3.5.1 National
3.5.2 International
3.6 Internet market
3.6.1 Overview
3.6.2 ISP market
3.7 Mobile communications
3.7.1 Overview of Bhutan’s mobile market
4. GEORGIA
4.1 Key statistics
4.2 Telecommunications market
4.2.1 Overview of Georgia’s telecom market
4.3 Regulatory environment
4.3.1 Regulatory authority
4.3.2 Privatisation
4.4 Fixed network operators
4.4.1 Akhali Kselebi Ltd (NewNet Telecommunications)
4.4.2 Egrisi
4.4.3 Sakartvelos Elektrokavshiri (United Telecom of Georgia)
4.4.4 Sakartvelos Telekomi (Telecom Georgia)
4.5 Telecommunications infrastructure
4.5.1 National telecom network
4.5.2 International infrastructure
4.6 Internet market
4.6.1 Overview
4.6.2 ISP market
4.7 Mobile communications
4.7.1 Overview of Georgia’s mobile market
4.7.2 Third Generation (3G) mobile
4.7.3 Major mobile operators
5. KAZAKHSTAN
5.1 Key statistics
5.2 Telecommunications market
5.2.1 Overview of Kazakhstan’s telecom market
5.3 Regulatory environment
5.3.1 Regulatory authority
5.3.2 Liberalisation
5.3.3 Privatisation
5.4 Fixed network operators in Kazakhstan
5.4.1 Astel
5.4.2 Ducat (formerly Kazintel)
5.4.3 Kazakhtelecom
5.4.4 KazInformTelecom (KIT)
5.5 Telecommunications infrastructure
5.5.1 National
5.5.2 International
5.6 Internet market
5.6.1 Overview
5.6.2 ISP market
5.7 Mobile communications
5.7.1 Overview of Kazakhstan’s mobile market
5.7.2 Major mobile operators
5.7.3 Trunk Mobile Radio (TMR)
6. KYRGYZSTAN
6.1 Key statistics
6.2 Telecommunications market
6.2.1 Overview of Kyrgyzstan’s telecoms market
6.2.2 Government projects
6.3 Regulatory environment
6.3.1 Regulatory authority
6.3.2 Privatisation of Kyrgyztelecom
6.4 Fixed network operators in Kyrgyzstan
6.4.1 Kyrgyztelecom
6.4.2 Others
6.5 Telecommunications infrastructure
6.5.1 National telecom network
6.5.2 International infrastructure
6.6 Internet market
6.6.1 Overview
6.6.2 ISP market
6.7 Mobile communications
6.7.1 Overview of Kyrgyzstan’s mobile market
6.7.2 Major mobile operators
7. MONGOLIA
7.1 Key statistics
7.2 Telecommunications market
7.2.1 Overview of Mongolia’s telecom market
7.3 Regulatory environment
7.3.1 Background
7.3.2 Communications Regulatory Commission (CTC)
7.3.3 Information & Communication Technology Authority (ICTA)
7.3.4 Mongolian Information and Communications Vision 2010
7.3.5 Competitive environment
7.3.6 Interconnection
7.4 Fixed network operators
7.4.1 Mongolia Telecom
7.4.2 Mongolian Railways Communications
7.5 Telecommunications infrastructure
7.5.1 National telecom network
7.5.2 International infrastructure
7.6 Internet market
7.6.1 Overview
7.6.2 Mongolia Internet Exchange (MIX)
7.6.3 ISP market
7.7 Broadband market
7.7.1 Fibre-to-the-building (FttB) project
7.7.2 ADSL
7.8 Mobile communications
7.8.1 Overview of Mongolia’s mobile market
7.8.2 Major mobile operators
8. NEPAL
8.1 Key statistics
8.2 Telecommunications market
8.2.1 Overview of Nepal’s telecom market
8.2.2 Nepal under emergency rule
8.3 Regulatory environment
8.3.1 Regulatory authority
8.3.2 Telecommunications Policy 1999
8.3.3 Telecommunications Policy 2004
8.3.4 Telecom sector liberalisation and licensing
8.3.5 Foreign assistance
8.3.6 Privatisation of Nepal Telecom
8.4 Basic telephone service providers
8.4.1 Nepal Doorsanchar (Nepal Telecom Co Ltd)
8.4.2 United Telecom Ltd (UTL)
8.5 Telecommunications infrastructure
8.5.1 National telecom network
8.5.2 International infrastructure
8.6 Internet market
8.6.1 Overview
8.6.2 ISP market
8.7 Mobile communications
8.7.1 Overview of Nepal’s mobile market
8.7.2 Major mobile operators
8.7.3 Satellite mobile
9. TAJIKISTAN
9.1 Key statistics
9.2 Telecommunications market
9.2.1 Overview of Tajikistan’s telecom market
9.3 Regulatory environment
9.3.1 Tajikistan Law on Electrical Communication
9.3.2 Regulatory authority
9.3.3 Privatisation of Tajiktelecom
9.3.4 Liberalisation
9.4 Fixed network operators
9.4.1 Tajiktelecom
9.5 Telecommunications infrastructure
9.5.1 National and international
9.5.2 Infrastructure developments
9.6 Internet market
9.6.1 Overview
9.7 Mobile communications
9.7.1 Overview of Tajikistan’s mobile market
9.7.2 Third Generation mobile (3G)
9.7.3 Major mobile operators
10. TURKMENISTAN
10.1 Key statistics
10.2 Telecommunications market
10.2.1 Overview of Turkmenistan’s telecom market
10.3 Regulatory environment
10.4 Telecommunications infrastructure
10.4.1 National and international
10.5 Internet market
10.5.1 Overview
10.6 Mobile communications
10.6.1 Overview of Turkmenistan’s mobile market
10.6.2 Barash Communications Technologies (BCTI)
10.6.3 Altyn Asyr
11. UZBEKISTAN
11.1 Key statistics
11.2 Telecommunications market
11.2.1 Overview of Uzbekistan’s telecom market
11.3 Regulatory environment
11.3.1 Overview
11.3.2 Privatisation of Uzbektelecom
11.4 Fixed network operators
11.4.1 Uzbektelecom
11.4.2 Buzton
11.4.3 East Telecom
11.5 Telecommunications infrastructure
11.5.1 National telecom network
11.5.2 Satellite communications
11.6 Internet market
11.6.1 Overview
11.6.2 ISP market
11.7 Mobile communications
11.7.1 Overview of Uzbekistan’s mobile market
11.7.2 Major mobile operators
11.7.3 Other mobile operators
12. GLOSSARY OF ABBREVIATIONS
Exhibit 1 - Level of competition by market segment - 2004
Exhibit 2 - Sakartvelos Elektrokavshiri’s Tbilisi network infrastructure
Exhibit 3 - Kazakhtelecom’s modernisation program for telecommunications - 2004 - 2006


Table 1 - Country statistics Armenia - 2005
Table 2 - Telephone network statistics - 2005
Table 3 - Internet provider statistics - 2005
Table 4 - Internet user statistics - 2005
Table 5 - Mobile statistics - March 2006
Table 6 - National telecommunications authority
Table 7 - Fixed lines in service and teledensity - 1991 - 2005
Table 8 - Internet users - 1994 - 2005
Table 9 - Internet host computers - 1995 - 2005
Table 10 - Mobile subscribers by operator and annual change - March 2006
Table 11 - Mobile subscriber growth - 1996 - 2006
Table 12 - Country statistics Azerbaijan - 2005
Table 13 - Telephone network statistics - 2005
Table 14 - Internet provider statistics - 2005
Table 15 - Internet user statistics - 2004
Table 16 - Mobile statistics - March 2006
Table 17 - National telecommunications authorities
Table 18 - Fixed lines in service and teledensity - 1995 - 2005
Table 19 - Internet users - 1995 - 2004
Table 20 - Internet host computers - 1996 - 2005
Table 21 - Mobile subscribers and annual change by operator - March 2006
Table 22 - Mobile subscriber growth - 1994 - 2006
Table 23 - Country statistics Bhutan - 2005
Table 24 - Telephone network statistics - 2005
Table 25 - Internet provider statistics - 2005
Table 26 - Internet user statistics - 2004
Table 27 - Mobile statistics - 2005
Table 28 - National telecommunications authorities
Table 29 - Fixed lines in service and teledensity - 1995 - 2005
Table 30 - Internet users and penetration - 1999 - 2004
Table 31 - Internet host computers - 1998 - 2005
Table 32 - Mobile subscriber growth - 2004 - 2006
Table 33 - Country statistics Georgia - 2005
Table 34 - Telephone network statistics - 2005
Table 35 - Internet provider statistics - 2005
Table 36 - Internet user statistics - 2005
Table 37 - Mobile statistics - March 2006
Table 38 - National telecommunications authority
Table 39 - Fixed lines in service and teledensity - 1995 - 2005
Table 40 - Internet user growth and penetration - 1996 - 2005
Table 41 - Internet host computers - 1995 - 2005
Table 42 - Mobile subscribers and annual change by operator - March 2006
Table 43 - Mobile subscriber growth and penetration - 1995 - 2006
Table 44 - Country statistics Kazakhstan - 2005
Table 45 - Telephone network statistics - 2005
Table 46 - Internet provider statistics - 2005
Table 47 - Internet user statistics - 2005
Table 48 - Mobile statistics - March 2006
Table 49 - National telecommunications authority
Table 50 - Fixed lines in service and teledensity - 1995 - 2005
Table 51 - Internet users - 1996; 1998 - 2005
Table 52 - Internet host computers - 1994 - 2005
Table 53 - Mobile subscribers and annual change by operator - March 2006
Table 54 - Mobile subscribers - 1996; 1998 - 2006
Table 55 - Country statistics Kyrgyzstan - 2005
Table 56 - Telephone network statistics - 2005
Table 57 - Internet provider statistics - 2005
Table 58 - Internet user statistics - 2005
Table 59 - Mobile statistics - March 2006
Table 60 - National telecommunications authority
Table 61 - Fixed lines in service and teledensity - 1991 - 2005
Table 62 - Internet users - 1998 - 2005
Table 63 - Internet host computers - 1997 - 2005
Table 64 - Mobile subscribers and market share by operator - March 2006
Table 65 - Mobile subscribers, penetration and annual change - 1998 - 2006
Table 66 - Country statistics Mongolia - 2005
Table 67 - Telephone network statistics - 2005
Table 68 - Internet provider statistics - 2005
Table 69 - Internet user statistics - 2005
Table 70 - Mobile statistics - March 2006
Table 71 - National telecommunications authorities
Table 72 - Fixed lines in service and teledensity - 1994 - 2005
Table 73 - Internet users and subscribers - 1996 - 2005
Table 74 - Internet host computers - 1996 - 2005
Table 75 - Growth of international bandwidth - 2000 - 2005
Table 76 - Mobile subscribers and yearly growth by operator - March 2006
Table 77 - Mobile subscribers, penetration and annual change - 1996 - 2006
Table 78 - Country statistics Nepal - 2005
Table 79 - Telephone network statistics - April 2006
Table 80 - Internet provider statistics - 2005
Table 81 - Internet user statistics - 2005
Table 82 - Mobile statistics - 2005
Table 83 - National telecommunications authority
Table 84 - Licences issued for telecom services - April 2006
Table 85 - NTC rural penetration levels - April 2006
Table 86 - Fixed-lines in service and teledensity - 1995 - 2006
Table 87 - Telephone demand forecasts - 2007; 2012; 2017
Table 88 - Internet users - 1997 - 2006
Table 89 - Internet hosts - 1995 - 2005
Table 90 - Mobile subscribers and annual change by operator - 2005
Table 91 - Mobile subscriber, annual change and penetration - 1999 - 2005
Table 92 - Country statistics Tajikistan - 2005
Table 93 - Telephone network statistics - 2005
Table 94 - Internet provider statistics - 2006
Table 95 - Internet user statistics - 2005
Table 96 - Mobile statistics - March 2006
Table 97 - National telecommunications authorities
Table 98 - Fixed lines in service and teledensity - 1995 - 2005
Table 99 - Internet users - 1999 - 2005
Table 100 - Internet host computers - 1997 - 2005
Table 101 - Mobile subscribers and annual change by operator - March 2006
Table 102 - Mobile subscribers and annual change - 1996 - 2006
Table 103 - Country statistics Turkmenistan - 2005
Table 104 - Telephone network statistics - 2005
Table 105 - Internet provider statistics - 2005
Table 106 - Internet user statistics - 2005
Table 107 - Mobile statistics - March 2006
Table 108 - National telecommunications authority
Table 109 - Fixed lines in service and teledensity - 1991 - 2005
Table 110 - Internet users - 1999 - 2005
Table 111 - Internet host computers - 1997 - 2005
Table 112 - Mobile subscribers and market share by operator - March 2006
Table 113 - Mobile subscriber growth and penetration - 1997 - 2006
Table 114 - Country statistics Uzbekistan - 2005
Table 115 - Telephone network statistics - 2005
Table 116 - Internet provider statistics - 2005
Table 117 - Internet user statistics - March 2006
Table 118 - Mobile statistics - March 2006
Table 119 - National telecommunications authority
Table 120 - Fixed lines in service and teledensity - 1991 - 2005
Table 121 - Internet users - 1999 - 2006
Table 122 - Internet host computers - 1996 - 2005
Table 123 - Mobile subscribers and market share by operator - March 2006
Table 124 - Mobile subscriber penetration and annual change - 1995 - 2006
Table 125 - Uzdunrobita mobile subscribers - 1998 - 2006
Table 126 - Unitel subscribers - 1998 - 2005

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