Colombo, Sri Lanka, October UNCTAD Regional Roundtable on Electronic Commerce and Development, Colombo (Sri Lanka) October 1999 LDCs and e-commerce The example of Nepal Shashank Kansal, President/CEO - Digital Telecom International Secretary General - Asia Pacific Trade Point Forum (APTPF) Voice: , Fax: GPO Box:10528, Kathmandu, Nepal.

Colombo, Sri Lanka, October n VSAT International Connectivity Allowed n UNLIMITED Bandwidth available n Prices Most Competitive in South-Asia (US$30 per month/unlimited access vs previous rates of US$2/hour) n New Telecom Opportunities like GSM and Paging start operations n Government takes initiatives to bring the IT on the forefront for Development.

Colombo, Sri Lanka, October Advantages and Limitations n Price reduction or Access n Hosting content in Nepal with huge capacity availability. n More POPs around the country - Nation Wide E-Commerce initiative. n Number of users likely to more than treble n WebSite creations! n Online Payment via Cyber Cash, Credit Card etc. (Offshore) n Government slow on Law, Banking, Infrastructure. n Call Centers, Unique in World !!!

Colombo, Sri Lanka, October “The Year of Convergence” n More POPs outside Kathmandu n No bandwidth expansion (via NTC) as market expects NTA to open up the skies - VSAT. Service is affected. n Customer support improves as market focus shifts to quality to customer support and response. n Several new businesses get new opportunity with internet.

Colombo, Sri Lanka, October n Three private ISPs in the country n Domain services available free n NGO, INGO, Govt. Organizations, Travel Agencies, Small Organizations, Corporate, Consulates, Expatriates etc start using the and Internet most due to expensive Telecom alternative! n First low speed digital link to Singapore Telecom established in 1995, subsequently upgrades to higher speed voice-grade lease circuit. n Price drop from Rs. 25/Kb to Rs 10/Kb

Colombo, Sri Lanka, October The Begining: n Experimental (Free) service is introduced by Ronast and Private Sector. Both organizations user dialup services provided by ERNET, New Delhi. n Only services (UUCP) introduced for low end Telecom.

Colombo, Sri Lanka, October Growth (Estimates) n Between 1994 and only users grows rapidly from 0 to 3,500 n 1998,1999 only users growth decreases in favor of Internet services n users now about 10,000 accounts (actual user about 30,000) n Between Internet users increase from 0 to 6,000 accounts (around 12-15,000 users) n In 1998 growth of Internet users slows down: bandwidth constraint, high prices deter new users.

Colombo, Sri Lanka, October Growth & Prices n Most of these figures likely to more than treble between June 1999 and June 2000 due to VSAT connectivity: –Lower costs –More bandwidth –More POPs – 15,000 accounts (50,000 users) –Internet 20,000 PPP accounts (100,000 users)

Colombo, Sri Lanka, October Bandwidth n Key Issue for E-Commerce n VSAT is the best Alternative n 1999: major change, Internet bandwidth increased over 5MB, VSAT. n : international bandwidth expect to exceed 15MB n National bandwidth: East West Fiber Highway

Colombo, Sri Lanka, October Ownership Ownership n ISPs - all private ownership except NTC and IOE, new entrants n Number of ISPs increase from previous 3 to 7-10 before the end of 1999 n NTC (a 100% government company, thus far) likely to provide access services in 1999 n IT companies start offering commercial services over the web.

Colombo, Sri Lanka, October Role of government (NTA) n Liberal policies n Best Telco infrastructure in the region n Incentive/subsidies to provide access to rural areas, poor and under privileged n Nepal better off than neighbors including India. n Cyber Law, IT-Policy n Education and Computer Awareness

Colombo, Sri Lanka, October Regulation n Internet regulations on the whole are progressive but are quite stringent n Access to content made the responsibility of ISP and end-users n Levies of multiple taxes could dissuade many potential users n % tax on “revenues”

Colombo, Sri Lanka, October Manpower availability and training n Most of the ISPs have used local computer and communications engineers and have been trained in-house n Some ISP consultancy services purchased from third country n Trained manpower is not expected to be a major hurdle in ISP infrastructure n End user training is widely available from ISPs and computer schools.

Colombo, Sri Lanka, October Future - E-Commerce n International connectivity - VSAT and Fiber Optics n Local content in international languages and vice versa n Web technology development n Private and International Banks - swift, credit cards, cirrus. n E-COMMERCE for SME and SMI n Virtual Galleries

Colombo, Sri Lanka, October Partnerships n Partnerships are the future n Governments should identify the Private Sector Importance n Geo Political Boundaries disappear –It is Now OR NEVER n Have a Great Electronic Information Future