Digital Agenda for Europe
A Europe 2020 Initiative

National experience in a global context

Article

The questions about governing the Internet has been solved in Bulgaria, and as chairman of the Internet Society (www.isoc.bg), I am happy to share the following: 1. Governments (since 1999) have worked in cooperation and coordination with the civil society, businesses, and academia, in order to provide Internet-friendly legislation about governing the Internet. 2. The telecom laws define the responsibility of the state to control the names, numbers, and addresses, except the Internet names (DNS) and Internet addresses (IP addresses). Note that numbering (ENUM) is still regulated by the state. Further details in the document, submitted by Bulgaria to the ITU PP-10. Source: http://isocbg.wordpress.com/2010/10/20/bg-itu/ - please download the document from there, in order to see all links and proper formatting. Information note from Bulgaria Contribution on Internet-Related Public Policy Issues by the Republic of Bulgaria 1. References: Resolutions 101, 102, 130; document 16/71(1) at PP-10, 2. Background A number of documents have been circulated among the ITU members, dealing with Internet-related issues. We would like to focus the attention of the ITU Member States and Sector Members on the question, being raised in the above mentioned documents, mainly the Internet access charges in developing countries. Document 16/71 stipulates that, “that advances in the global information infrastructure, including the development of Internet Protocol (IP)-based networks and especially the Internet, and future IP developments, continue to be an issue of crucial importance, as an important engine for growth in the world economy in the twenty-first century, even if expectations in terms of the number of Internet users in developing countries have not been met due to high service subscription charges;” These lines raise the following questions, to which we believe Bulgaria could provide some answers: What are the expectations of developing countries in terms of number of Internet users? Which developing countries have exactly that expectations? What are the reasons for their expectations not being met? Are there other reasons, besides the high service subscription charges? 3. Statistics Currently the Internet penetration of the countries, where these questions seem to gain momentum, is as follows(2): Syria – 17.7 %, Saudi Arabia – 38.1 %, UAE – 75.9 %, Libya – 5.5 %, Lebanon – 24.2. %, with average for the Middle East of 29.8 %. To compare it, average for Europe is 58.4 %, with many countries having less penetration than the UAE, and some – less than Saudi Arabia. In the USA 77.4 % of the population is online. Clearly, we see that some of the Arab countries are better connected than Europe, and close to the USA (e.g. UAE). It would require detailed studies (commercial, academic, governmental) why countries, with different level of economic development, Human Development Index and country standards, as listed by the World Bank or the IMF(3) could have similar problems with regards to the price of Internet services(4). For these reasons, we would like to explain the situation in Bulgaria, which is a country, similar in its Internet development to the ones, who have signed the proposed draft document 16/71 at PP-10. 4. Internet Access, International Internet Connection Fees, and Development of the Internet in Bulgaria Until recently Bulgaria was a developing country with status of economy in transition, and today it is still a country with economy in transition with GDP, ranking this country as 71st in the world, so we face similar problems to those raised by, among others, our distinguished colleagues from some Arab countries(5). 4.1. Facts(6) Internet was introduced in Bulgaria in 1989 with first Bulletin Board Systems and dial-up access starting to take off and becoming popular in 1990. In 1999 there were 76000 users in the country (less than 1 %). Until 1995 there were only 2 Internet Service Providers (ISPs). Flat (monthly) charge was introduced in 1996. Licenses and registration for ISPs were removed in 1999, after being briefly introduced by the government at the end of 1998, and challenged successfully at the Supreme Administrative Court by ISOC-Bulgaria(7). VoIP became legal in 2001(8). Currently there are more than 1000 ISPs in Bulgaria(9). Approximately 50 % of the population is online(10). More than 55 % have access at speeds above 10 Mbps (according to the survey by Fiber to the Home Council Europe and EC data(11), that ranks Bulgaria 1st in Europe; Sweden is 2nd, with distant 36 %. Price comparison: Currently in the U.S.A. the average price for an ADSL connection is $ 45 per month for about 3 Mbps(12). In Bulgaria users could connect to the Internet at prices, starting from about $ 15 per month at 100 Mbps(13), or in some cases – at 1 Gbps. Taking this into account, one could even calculate that Internet access for end-users in Bulgaria is 90 times, and in some cases 900 (nine hundred) times cheaper than the one in the U.S(14). There were problems with International Internet connectivity fees in Bulgaria, when there was only one provider, the Bulgarian Telecom (a state-owned company having monopoly in the market), and a small number of users. At that time users were being charged on per Kb base, with 1 Kb being priced at 3.5 U.S. cents, and their access was only via dial-up. The prices started to go down when there were more users. However, governmental regulation of telecommunication prices has not brought significant increase of the number of users. As a matter of fact, it was the increasing number of users which made the ISPs search to provide higher standards both in their access points (dial-up, cable, LAN, wi-fi, etc.), and in international connections. In their desire, or need to do so, the ISPs obtain better pricing from their international partners, or upstream providers. The Bulgarian experience (which has been addressed and explored in more details in the Fiber to the Home Council Europe paper) clearly shows that subscription charges go down, when there's a critical mass of users, PLUS privatization of the state-owned telecom, PLUS existence of many (in the case of Bulgaria – thousands) ISPs, PLUS liberal legislation in the field of Internet. For security reasons, majority of users are connected via IP networks, which are issuing “fake”, 192.168.0.0, addresses to the users, thus solving a number of critical and security issues. 4.2. Conclusions Internet prices go down, when there is no governmental regulation on Internet and ISPs. Internet charges are related to the competition in the telecom market. When there is only one, state-owned or private, telecom, prices are, as a rule of the thumb, always high. Subscription fees are related to the number of users. The more users one has in a country, the less subscription fees they pay. There is a particularly good opportunity for the developing countries, as ISPs there have to find a way to provide access to people with relatively low income, so they come with creative means to satisfy the demand. An incumbent fixed phone company could hardly do this. There is no evidenced relation between the IP addresses and the price of the Internet access. We have not found any relation between usage of the IPv4, IPv6 addresses and price of the Internet access(15). We hope that our contribution will give some ideas about the way the Internet has evolved in a country in transition, and the positive experience could be followed by other countries. We are open to share experience, and support the efforts of other administrations in their attempts to bridge the digital divide. _____ (1) See here: http://www.itu.int/md/S10-PP-C-0016/en (2) Sources: ITU, Internet World Stats,Fiber to the Home Council Europe, ISOC-Bulgaria See in particular this study. (3) See List of Countries by GDP (nomina) (4) See also ITU publication Measuring the Information Society 2010 (5) See same list as above; for example Syria is 68th, Saudi Arabia is 25th/26th , UAE is 33th/35th/37th/ (6) Quoted data is based on researches, being done through the years by ISOC-Bulgaria, as well as survey organizations, for example Market Test, and others. (7) http://www.isoc.bg/kpd (8) See record from the session of the Parliament of Bulgaria, April 11, 2001. (9) According to this statistics, which lists the ISPs only in the big cities and the capital. (10) Statstics by TGI, October 2009 (11) See also the European Commission data. (12) See for example www.comcast.com (note there are special prices for first six months) (13) Connections at 100 Mbps are usually via utp cable category 5, and at 1 Gbps via fiber optic. Prices may vary, depending on provider and city. (14) Of course, this is just a simple calculation, not having in mind GDP, average salary, etc., but we use it just to stress on the difference in understanding the actual facts behind prices. (15) Bulgarian Telecommunications Laws since 1999 specially exclude any governmental control or regulation on IP addresses and Internet domain names (see the current Law on Electronic Communications, Additional Provisions, §1, point 3 and point 21.)

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Hi Veni,

Fancy meeting you for the first time after high-school on DG CONNECT's online community page! Of course, it had to be online...

Thank you for your detailed description of how Internet access evolved in Bulgaria. I found it a fascinating read & definitely a success story. I hope you'll get involved further in this online discussion on the issues around Internet governance: its leading principles, multi-stakeholdersim; its architecture & the legal questions that affect it.

Great to know this is on your radar-screen.

 

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I thought it was you;-)
We need to make sure Commissioner Kroes hears more about this and other success stories. When she was in Sofia last year, a colleague of mine, Dimitar Ganchev wrote an article for the 24 hours daily, which was used by the Bulgarian Ministry of ICT, to prove its case. The article is titled "Bulgarians may grow potatoes, but have the fastest Internet" (http://www.24chasa.bg/Article.asp?ArticleId=1552406), and Mrs. Kroes admitted our data (well, HER data) was correct.

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Hi Veni,

Indeed. All too often the discussion focuses on comparisons between the EU versus the US & Japan. Perhaps it would be more fruitful to promote the champions of the EU & draw from their experience. In any case, we shall be feeding the threads of this discussion straight to VP Kroes so your point will be made.

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MARTINEZ GONZALEZ Cristina European Commission DG CONNECT/02 Head of Sector 'Integration of Regulation, Policy and Research"
KARLOUKOVSKA Vessela European Commission, DG CONNECT Stakeholders Unit Policy officer
AGARWAL Prabhat European Commission DG CONNECT Policy Officer
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