State Institutions Crucial for Liberalization of Telecommunications Market

09 January 2007

On.net is the first company to appear as competition for the Macedonian Telecom in a number of years. How does the Telecom accept such competition? Do you face obstructions?
Predrag Cemerikik: On.net is, indeed, the first company to sign the interconnection agreement. However, the Macedonian Telecom is using all means available to it to slow down the whole process.

What is your opinion of the general terms and conditions for interconnection, having in mind the virtual monopoly on the infrastructure given to the Telecom, that expires in 2018?

Predrag Cemerikic

Predrag Cemerikik: The requirements are the same for all and were approved by the Agency for Electronic Communications (AEC) of the Republic of Macedonia. In a word � they are far from favourable. We now expect to see what the changes announced in December may bring about. Actually, Macedonian Telecom has no monopoly over the infrastructure, at least not on paper. The approval of the Referent Interconnection Offer (RIO) by the AEC created an opportunity to start using the copper wires and lines immediately. However, the financial conditions remain unfavourable for us in that area, too. At this time, On.net negotiates the RUO with Macedonian Telecom.

Macedonia is not the only country with a monopoly given to the national telecom company and yet, making a phone call remains the most expensive in the region. Why is that?
Predrag Cemerikik: Obviously, it is due to the wish to maintain the unprecedented profit margin of 55%. The Telecom makes about 150 million EU in profits on total earnings of approximately 250 million EUR. No business could possibly result in such high profit margins. As a result, we have high phone bills.

Your company initially started as an Internet Service Provider (ISP). Why is the internet in Macedonia so expensive?
Predrag Cemerikik: I would not say that internet is expensive. I wouldn�t say that at all. The fact is that the average salaries are to low, which makes it unaffordable. The prices are pretty much the same as elsewhere in the region and Europe. On.net offers 30 days of 512 kbps broadband for 19 EUR everywhere in Macedonia, including the most rural of areas.

Do you plan to engage in other social activities, such as the free coverage with wireless internet of all schools in the country, in the future?
Predrag Cemerikik: Yes, of course. On.net is a standing member of the UN Global Contract since December 2004, and that is the largest global initiative for corporate social responsibility. In that regard, we have been constantly engaged, and will continue to be engaged, in a series of activities. Only last year we secured free internet connection in 10 cities, under the �Macedonia Surfing� campaign; we supported the e-public debates organized by the Youth Education Forum; provided free business internet packages for students that won the university-wide competition for best business plan; etc.

In terms of covering the country with wireless internet network, is the whole of Macedonia covered? Or is it only true of Skopje, while the process in the smaller towns lags behind? When will Macedonia become a truly �wireless� country?
Predrag Cemerikik: I can say that Macedonia is definitelly fully covered by the Wadsl (wireless ADSL) services provided by On.net. We use Motorola�s technology that offers speeds of up to 4 Mbit per user. In Skopje, On.net has 80 additional WiFi hotspots that offer mobile internet service.

What is your opinion of the National Information Society Strategy? Is it good, in terms of its quality and, more significantly, can it be implemented?
Predrag Cemerikik: We all agree that it is a good strategy and that it is applicable. It depends mostly on the will of the state and its institutions to start working on it seriously and with full effort.