Efforts to support local entreprenurs in Mongolia's IT sector facilitating domestic content production

While the overall number of internet users in Mongolia grew eight-fold from 2009 to mid-2014 – from just over 100,000 to more than 1m, according to the Communications Regulatory Commission of Mongolia (CRC), the nation’s telecommunications regulatory organisation – most locals spend their time online at foreign websites. As of mid-2014 Mongolian internet content was rare. According to recent statistics from SimilarWeb, an Israel-based data analytics company, the top six websites in Mongolia (by total page loads) are foreign sites, including Facebook (the most popular website in Mongolia), Google, YouTube and Yahoo, among others. Four Mongolian sites made the top 10, namely the news and entertainment sites news.mn, caak.mn and unegui.mn, and the search engine gogo.mn.

Nascent Segment

The lack of local content is widely regarded as a key hurdle to the expansion of the ICT. Foreign websites and other content are largely inaccessible to Mongolians who do not speak English – the majority of the population. Encouraging this large group to subscribe to data services and buy devices will remain a challenge so long as online Mongolian-language content is hard to find. In late-2013, after more than two years of cooperation between the government and the US-based ICT giant Google, the Mongolian language was added to Google Translate, the firm’s popular online translation service. Since mid-2011 Google has also been in talks with the Mongolian government to set up a data centre in the country (see overview).

The lack of local internet content also reflects the relatively small size of Mongolia’s domestic consumer-oriented ICT sector as a whole. In 2013 the country’s ICT sector – which includes telecoms operators – brought in income of MNT784bn ($470.4m), up significantly from MNT649.7bn ($389.8m) in 2012, for example. Domestic consumer-oriented content producers – and local firms in general – accounted for only a small percentage of this total. Incidentally, one area where Mongolia firms comprise a considerable percentage of revenues is the business services segment.

A Key Area of Focus

With these hurdles in mind, encouraging local ICT development – in the form of the establishment of new companies, new products and divisions at existing firms and various other types of innovation – is currently one of the government’s primary objectives. By supporting local initiatives in these areas, the state has had a considerable success in boosting awareness of the internet and technology.

Most of these state-led programmes are being carried out under the government’s ICT Vision 2021, which was launched in November 2012. A number of key elements of the long-term plan relate to the issue of local content, including a programme to establish a domestic ICT research and development centre, for example, and another aimed at boosting ICT awareness throughout the country, with a focus on rural areas. These initiatives follow several other ICT programmes put in place by the state over the past 15 years.

Indeed, Mongolia has been relatively progressive as compared to some its Central Asian neighbours, in terms of supporting technology development. In 2003 the Information Technology, Post and Telecoms Authority – the government’s ICT policy development and implementation body – established the National IT Park (NITP) in Ulaanbaatar. Today the NITP is a centre for Mongolia’s technology industry, housing many ICT-related companies. Mongolia’s first ICT business incubator is housed at the NITP, among many other entities.

In addition to the government, a variety of other domestic and foreign organisations have taken on an active role in the development of local ICT content in recent years. In June 2011 a group of Mongolian entrepreneurs launched Startup Mongolia, a non-profit entity that offers advice, networking opportunities and various technical services to local ICT entrepreneurs, with the goal of facilitating the development of new companies. In conjunction with a variety of other local ICT-related firms and educational institutions, Startup Mongolia, for example, has organised meet-ups for local technology players and prospective investors.