1. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS BULGARIAN BROADBAND CURRENT SITUATION - COVERAGE, STRATEGY AND PROJECTS

2. Broadband advantages Increasing of broadband connectivity is recognised as one of the basic instruments for enabling major improvements in economic and social wellbeing. Widespread, high-speed access can deliver significant increases in GDP, expands employment, increases international competitiveness and improves quality of life. Broadband connectivity can also enhance community cohesion through novel and enhanced communications as well as deliver better choice and convenience for families and individuals in work and other aspects of daily life. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

3. European policy for broadband i2010: Broadband access for all The initiative contains a range of EU policy instruments to encourage the development of the digital economy such as regulatory instruments, research and partnerships with stakeholders. Promotes high-speed and secure broadband networks offering rich and diverse content in Europe; Community Guidelines for the application of State aid rules in relation to rapid deployment of broadband networks The guidelines contain special provisions on penetration of networks for access of the next generation, enabling public financial means to reinforce investments in this strategic sector, without causing distortion of market competition; MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

4. European policy for broadband EUROPE 2020 A strategy for smart, sustainable and inclusive growth Flagship Initiative: "A Digital Agenda for Europe" The aim is to deliver sustainable economic and social benefits from a Digital Single Market based on fast and ultra fast internet and interoperable applications, with broadband access for all by 2013, access for all to much higher internet speeds (30 Mbps or above) by 2020, and 50% or more of European households subscribing to internet connections above 100 Mbps. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

5. Distribution of the number of Internet subscribers by line capacity Source: Data submitted to CRC MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

6. Broadband services penetration by population Source: Commission staff working document accompanying the Progress report on the single European electronic communications market (15th Report) MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

7. Distribution of subscribers according to the type of technology Source: Data submitted to CRC MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

8. National strategy for the development of broadband National Strategy for the development of broadband in the Republic of Bulgaria (2010-2013) – adopted in Nov. 2009 The National Strategy for the first time stands a systematic approach for solving the problem and identifies medium and long term strategic objectives in order to overcome the gap in broadband access compared to other EU countries and to satisfy the requirements set out by current EU programming documents. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

9. National Strategy 2010 - 2013 - main parameters The National Strategy provides a general framework for broadband development: Total financial ressources - 150 million EURO; Total number of projects - 5 - 10; Total number of settlements - 120 cities and 3500 villages (white and gray areas); Total population covered - 3 000 000. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

10. Social and economic goals To develop and optimize accessibility, quality and scope of services (in the fields of education, health, administrative services etc.) by use of broadband access in all regions of the country. To boost social cohesion by providing access to online services to people living in scarcely populated and remote areas and thus, overcoming trends for “digital divide” with this part of the society. To improve competitiveness of the Bulgarian economy which will lead to increasing employment and welfare of people by ensuring a research and innovations platform and thus, increasing the GDP. To increase trust in Internet by imposing security and behavior rules corresponding to business standards. To facilitate and stimulate the use of broadband access by business for the needs of implementing new business strategies and providing new services to end-users. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

11. Technological purposes - connectivity, networks, infrastructure Connectivity in the regional and major cities: by 2013 the population should have the opportunity for broadband access with speeds above 20 Mb/s, within the locality; to provide wireless access in public places; by 2013 to allow for fiber connectivity to be introduced to over 80% of the households in the vicinity of their homes; by 2013 to build a broadband infrastructure bracing health centres and hospitals in the country. Connectivity of the medium settlements: by 2013 - up to 90 % of the population to enable broadband access within a locality at a speed exceeding 10 Mb/s; to provide wireless access in public places at least in city- halls and mayors’ offices; by 2013 to allow for optical connectivity up to 80% of households in the vicinity of their homes. Providing broadband access in remote and rural areas by 2013 – up to 50 % of the population to enable fixed and wireless access in the locality; by 2010 the population of the country to be able to access the computer and the Internet as close as possible to their home. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

12. Funding Sources For the programme period 2007-2013 in the Operational Programme "Regional Development", under Priority axis 2., Operation 2.2. "ICT Network” are stipulated funds to the amount of 20 mln. EURO. Funds for investment purposes from the budget of MTITC amount commensurate with the economic situation in the country. Funds from other Operational Programmes like the Rural Development Programme, the Operational Programme “Administrative Capacity” (OPAC) ect. Funds from private investors attracted in various forms of public private partnership. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

13. Participants State - In areas where intervention is warranted by the state of social and economic perspective, it is important to define clear and equitable measures needed to achieve the targets outlined in the Strategy. Municipalities (local authorities) - Municipalities foster economic development at local level, reduce costs throughout economies by merging into a single network; assist in obtaining the necessary permits. The private sector - Active involvement of the private sector in the construction of broadband infrastructure and the provision of broadband services is crucial factor for the achievement of the positive effects of scale deployment of broadband. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

14. Implementation of the National Strategy 2010 - 2013 An expert group is formed with the following tasks: To develop an evaluation methodology for objective selection of settlements that will be included in the pilot projects; To analyze and propose models of public-private partnership for the implementation of projects under the national strategy; To develop а National programme for the accomplishment of the objectives of the National Broadband Strategy and Investment Framework Programme 2010-2013; To support the methodological work on assignments and preparation of proposals with reference to the implementation of pilot projects. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

15. National Strategy - stages The National Strategy will be implemented gradually, taking into account the available financial resources aimed at achieving the objectives set out in it. The National Strategy will be periodically amended in order to satisfy the requirements set out current EU programming documents A National Operational Plan for implementation of the National Strategy is under development. It will comprise the requisite activities, respondents, dead-lines and financial resources as well as the common activities and integrated efforts with other authorities and institutions. First step - Construction of broadband connections to the urban periphery and less urbanized and rural areas Next steps - Integration of public infrastructures - Development of critical, secure, safe and reliable public infrastructure MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

16. Road map 2010 – 2015 MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

17. Road map 2011-2012 MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

18. Selection of Settlements for the project MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS Evaluation criteria for the selection of settlements that will be included in the investment project:  population – more than 500 citizens;  availability of broadband infrastructure and broadband services (zone under the classification of the EU, in which the locality is situated in);  presence of public institutions as a prerequisite for active public and social relations (schools, hospitals, community centers, etc..);  presence оf prerequisites of economic activity, for the occurrence of such in the locality;  presence of willingness or readiness in the population for employment of broadband services;  availability of opportunities for realization of successful forms of public- private partnership.

19. Broadband Penetration in Cities and Villages MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS Source: Data provided by CRC for the purposes of the study

20. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

21. Target group of the investment project The target group of the investment project are 19 pre-selected regions, each including between three and five municipalities, which have the highest concentration of remote settlements, situated in basic broadband "white areas".The total number of settlements which will be covered by the proposed measure will be between 800 and 900 according to the technology used for implementation and network topology, and the population covered would be between 400 000 and 450 000. Population in those towns and villages is characterized by relatively low or thoroughly missing awareness of ICT and Internet benefits and hence, the lack of readiness for Internet use and electronic communication services. As a result, private companies are not interested to invest in the said areas. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

22. Pre-investment study The conduct of these preparatory activities and the preparation of the following documents, will enable EA “ECNIS” as a direct beneficiary to apply to the Managing Authority of Operational Programme "Regional Development" and this would ensure successful opening of Operation 2.2. of the OPRD preliminary feasibility study; including research on alternative technologies applicable to its implementation; a survey of existing communication infrastructures as for this purpose a map should be made; evaluate the potential demand and consumption of broadband services in selected areas through the method of interview with specially designed questionnaires; cost-benefit analysis; MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

23. Application of State Aid Rules Questions under discussion with the representatives of the European Commission(DG INFSO, DG Regio, DG Competition):  Concept for the implementation of the investment initiative for the regional networks for broadband access  How the aid measure fits into the national broadband strategy and the EU objectives;  Preparation and lodgement of a Notification for application of State aid MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

24. Organization of a regional network with open access MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS

25. Minimum service requirements The proposed infrastructure must meet the following functional requirements:  Ensure the provision of multimedia services;  The provision of services must be independent of the used transport- related technologies like optical fiber, point-to-point radio or others;  Must allow retail suppliers to use different technologies for access to end customers, such as Ethernet, xDSL, 3G, WiMAX, DOCSIS and others.

26. MINISTRY OF TRANSPORT, INFORMATION TECHNOLOGY AND COMMUNICATIONS Thank you for your attention! www.mtitc.government.bg