Papua New Guinea: ICT communication breakdown

The information and communications technology (ICT) regulator for Papua New Guinea (PNG) has recommended the principal fibre-optic connection be made available to all internet service providers (ISPs) for direct sale as broadband products with the aim of opening up the internet market. However, state-owned PNG Telikom says it needs more one-on-one consultation with the body and that at least one more fibre-optic cable is needed to meet the country’s ICT ambitions.

The National Information and Communications Authority (NICTA), launched in May 2011, said in a paper published in September that access to international communications cables, gateway facilities and satellite links should be made “declared services”, meaning PNG Telikom has to supply access to its competitors and subject it to price regulation.

“Telikom PNG is the only licensee that is authorised to operate a landing station in PNG in relation to either the PPC-1 cable or the APNG-2 cable, and to supply capacity on those cable systems. As a result, Telikom PNG has as a market share of 100% for wholesale capacity on, and access to, international fibre-optic submarine cables,” NICTA wrote.

In July, PNG connected to a 10-gigabyte-per-second (GBps) fibre-optic gateway in Madang. The 750-km PPC-1 cable connects in Sydney and piggybacks ExxonMobil’s liquefied natural gas (LNG) pipeline. Previously, the country was reliant on the APNG-2 submarine cable, which connects Port Moresby’s digital exchange in Boroko with Sydney.

Before the arrival of fibre-optic, PNG’s hilly and heavily forested terrain made the spread of ICT services a challenge for providers, with mobile penetration at 41% and internet penetration estimated at 5%. ICT firms have also faced a lack of human resources and infrastructure, though the country plans to provide national communication access to every citizen at affordable prices in the coming years.

While Telikom PNG is the sole supplier of broadband services, there are 12 ISPs offering data through satellite services, with another nine firms currently applying for licences. The establishment of NICTA should help to reduce internet tariffs, which are artificially high.

“Plans to improve competition by replacing Telikom PNG’s monopoly with an updated regulatory framework are positive, as well as build on the recent successes in the deregulation of the telecommunications industry,” the IMF wrote in a February 2012 report.

Responding to NICTA’s report, Telikom PNG said there is a need for better communication between the firm and the sector’s regulator. The state-owned firm further added that before requests for “declared services” can be made, an additional fibre-optic cable must be connected to the national network in order to increase national capacity. Telikom PNG also rejected claims that it has not provided fair, wholesale access to internet infrastructure and that its pricing structure is unfair.

“NICTA needs to be sensitive to Telikom PNG’s plans and should be holding one-on-one discussions with our firm to gauge our needs,” the firm said in a detailed response to regulator’s questions.

Telikom PNG has also said that a long-term solution for expansion of the sector, as well as introducing more effective and fair competition, is for NICTA to promote the market’s potential abroad and draw foreign investors into the country.

“A new gateway facility and another submarine fibre-optic cable, preferably between Lae [the second-largest city in PNG] and Singapore in order to access the Asian market, is a must. This should be implemented within the next five years,” said Telikom PNG. “Telikom PNG has not denied nor has it ever refused to supply access to its competitors,” the firm added.

Whatever the respective merits of the cases put forward by Telikom PNG and NICTA, retail customers will continue to lose out on fair and fast internet access until an agreement is reached between the two sides.