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ECUADOR'S TELECOMMUNICATION SECTOR

Paramaribo 2004Verónica Yerovi A.

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n Special Telecommunication Act

n Act to reform the Special Telecommunication Act

n Act for the Economic Transformation of Ecuador

n Radio and Television Broadcasting Act

n Act to reform the Radio and Television Broadcasting Act

LEGISLATION PERTAINING TO THE TELECOMMUNICATION SECTOR

LEGAL FRAMEWORK

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TELECOMMUNICATION SECTOR ENTITIES

National Telecommunication Council

(CONATEL)

National Radio and Television

Broadcasting Council (CONARTEL)

National Telecommunication

Secretariat (SNT)

Office of the Superintendent of

Telecommunications (SUPTEL)

REGULATORY FUNCTION

EXECUTING AGENCYFOR CONATEL

POLICIES

OVERSIGHT FUNCTION

EXECUTING AGENCY FOR

CONARTEL POLICIES

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TELECOMMUNICATION SERVICES

Telecommunication services fall into four groups:n End-user servicesn Bearer services n Value-added servicesn Resale services

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LICENCESn CONCESSIONS:

n End-user servicesn Bearer servicesn Use of frequencies

n PERMITS:n Value-added servicesn Private networks

n REGISTRATION:n Cybercafésn Physical networks (bearers)n Spread spectrum

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OPERATORS

SERVICE REGIME OPERATORSFixed telephone service Competition 7 (3)Mobile telephone service Competition 3Bearer services Competition 14Trunk systems Competition 7Value-added services Competition 120 (60)Cybercafés Competition 1 500

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FIXED TELEPHONE SERVICE

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TARIFF REGULATIONn Provision of a service subject to payment of

tariffs regulated under the corresponding contracts

n Special affordable tariffs for low-income segments of the population

n Criteria for setting tariffs

n Approval procedures (for public services)

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TARIFF REGULATIONn The following services are subject to tariff

ceilings:n Fixed telephone servicen Mobile telephone service

n The following services are not subject to tariff ceilings:n Bearer servicesn Trunk systemsn Value-added services

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Current tariffsApproved

ceilingsDifference

Registration feeCategory A 30.00 44.00 31.82%

Category B 60.00 88.00 31.82%

Category C 60.00 200.00 70.00%

Basic fee

Category A 1.20 + 100 minutes 6.90 + 0 minutes 82.61%

Category B 7.00 + 100 minutes 8.60 + 0 minutes 18.60%

Category C 12.00 12.00 0.00%

Usage fees

Category A

Local 0.003 0.017 82.35%

Regional 0.010 0.027 62.96%

National 0.012 0.056 78.57%

To cellular telephones 0.29 0.290 0.00%

Category B

Local 0.015 0.017 11.76%

Regional 0.027 0.027 0.00%

National 0.056 0.056 0.00%

To cellular telephones 0.29 0.29 0.00%

Category C

Local 0.024 0.028 14.29%

Regional 0.056 0.056 0.00%

National 0.112 0.112 0.00%

To cellular telephones 0.29 0.29 0.00%

Group 2 (Mexico, USA, Canada) 0.25 0.25 0.00%

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IET- FS / JG /SEPTEMBER 2003

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50 000 000

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450 000 000Q

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1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

CONSOLIDATED TOTAL GROWTH TREND

INTERNATIONAL TELEPHONE TRAFFIC HANDLED BY ANDINATEL S.A. AND PACIFICTEL S.A., IN MINUTES, 1992 TO 2003 MINUTES PER

CALENDAR QUARTER

TOTAL TELEPHONE TRAFFIC

OFFICE OF THE SUPERINTENDENT OF TELECOMMUNICATIONS

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IET - FS / JG /SEPTEMBER 2003

ECS 0

ECS 5.000.000

ECS 10.000.000

ECS 15.000.000

ECS 20.000.000

ECS 25.000.000

ECS 30.000.000

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

TRAFFIC ENTERING ECUADOR HANDLED BY EMERGING CARRIERS, ACCORDING TO THE FCC

LOST REVENUE FROM BYPASS

LOST REVENUE

FROM VOIP

Dollar value

OFFICE OF THE SUPERINTENDENT OF TELECOMMUNICATIONS

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MOBILE SERVICE TARIFFSn PAID IN ADVANCE

n USD 0.50

n PAID AFTERWARDSn USD 0.12

n SHORT MESSAGESPackage Cost Duration160 messages or e-mails USD 2 + VAT 30 days300 messages or e-mails USD 5 + VAT 30 days

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Telecommunication policiesn Open competitionn Universal servicen Promoting the development of the

Internet

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Telecommunication policiesn Mandatory interconnection and connection,

thereby guaranteeing connectivityn Preparating draft legislation to establish service

and network standardsn Promoting convergence

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Universal servicen Establishing the Fund for Telecommunication

Development in Rural and Marginal Urban Areas (FODETEL)

n Formulating the Universal Service Plann Including public services (fixed and mobile

telephone service) under universal service

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FODETELn FODETEL is a fund set up to assist rural and

marginal urban areas not covered by the expansion plans of service providers approved by CONATEL or under existing licences.

n To finance this fund, all telecommunication service providers holding a licence are required each year to contribute the equivalent of 1 per cent of their service revenues from the previous year.

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FODETELFODETEL operates by conducting public competitions aimed at selecting the best qualified person or firm to carry out projects in specific areas, on the basis of the smallest direct subsidy or other selection criteria.

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Telecommunication policyPromoting the development of the Internetn Encouraging the use of the Internet as a tool for

furthering Ecuador's cultural, social, political and economic development.

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Connectivity Agendan The objective of the Connectivity Agenda is "to develop

infrastructure that will give people access to information and communication technologies (ICTs), in every part of Ecuador, so that they may share in the benefits of the knowledge society". To this end, special technical committees may be set up to devise national programmes in such fields as tele-education, telemedicine, e-commerce, connectivity infrastructure and e-government.

n The ultimate aim is to evolve into an information and knowledge society and to guarantee the right to access these information and communication technologies and use them in a fair and democratic way.

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Principal lines of strategic action

The National Connectivity Agenda's principal lines of strategic action are centred on access infrastructure, tele-education, telehealth, e-government and e-commerce.