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Washington, D.C: infoDev / World Bank. Available at http://www.broadband-toolkit.org. iii Table of Contents Executive Summary……………………………………………………………………………… 7 1. Turkish ICT Sector: A General Assessment…………………………………………………… 8 1.1 Background……………………………………………………………………………… 8 1.2 ICT Sector………………………………………………………………………………. 10 2. Turkey’s Broadband Ecosystem: A General Assessment……………………………………… 13 2.1 Synopsis of Near History: Evolution of Markets and Public Reform……………………… 13 2.2 Institution Setup: Current Policy, Legal and Regulatory Framework……………………… 14 2.3 Infrastructure Development……………………………………………………………… 17 2.3.1 Broadband penetration……………………………………………………………. 18 2.3.2 Broadband technologies…………………………………………………………… 21 2.3.2.1 Backbone network…………………………………………………………… 21 2.3.2.2 Local access technologies…………………………………………………… 21 2.3.3 Prices……………………………………………………………………………… 26 3. Applications…………………………………………………………………………………… 30 3.1 Government……………………………………………………………………………… 30 3.2 Electronic Commerce…………………………………………………………………… 34 3.3 Other Applications: The Rise of Social Media…………………………………………… 36 4. Usage and Diffusion…………………………………………………………………………… 39 4.1 People…………………………………………………………………………………… 39 4.2 Business…………………………………………………………………………………… 41 5. Conclusions…………………………………………………………………………………… 44 5.1 The Likely Impacts of High Bandwidth Networks on Turkish Economy………………… 44 5.2 Factors Contributing to Turkey’s Broadband Development……………………………… 45 5.2.1 Lessons learned……………………………………………………………………. 45 6. References……………………………………………………………………………………… 48 6.1 Online Resources………………………………………………………………………. 49 iv List of Figures, Tables and Boxes Figure 1-1: Geographic position of Turkey……………………………………………………… 8 Figure 1-2: Global Competitiveness Index, Turkey, 2010………………………………………… 8 Figure 1-3: Fastest growing economies in ICT spending, 2003-2009……………………………… 10 Figure 1-4: The composition of ICT spending in Turkish economy, 2009……………………… 11 Figure 1-5: Evolution of ICT foreign trade in Turkish economy, US$ million, 2004-2009……… 12 Figure 2-1: Fixed broadband penetration gap with selected countries, 2010……………………… 18 Figure 2-2: Fixed broadband (per 100 inhabitants), net increase, June 2009-2010………………… 19 Figure 2-3: Selected penetration indicators, percent……………………………………………… 19 Figure 2-4: Technological configuration of broadband infrastructure as percent of shares, 2010… 22 Figure 2-5: Breakdown of fixed broadband subscribers by access speeds, 2010………………… 22 Figure 2-6: Shares of technology in total broadband subscriptions, percent, 2010………………… 25 Figure 2-7: Percentage of fibre connections in total broadband, June 2010……………………… 25 Figure 2-8: Broadband average monthly subscription price, Oct 2009, USD PPP………………… 27 Figure 3-1: Number of public sector owned websites…………………………………………… 31 Figure 3-2: The maturity level of selected public services, percent, 2007………………………… 31 Figure 3-3: Ownership of websites, by employment size of enterprises, 2009…………………… 34 Figure 3-4: E-commerce activities of enterprises by sector of activity, 2007……………………… 34 Figure 3-5: The benefits reported through e-commerce, 2008…………………………………… 35 Figure 3-6: The Turkish social media landscape, 2010…………………………………………… 38 Figure 4-1: Household broadband penetration, as percent……………………………………… 39 Figure 4-2: Internet usage by place of connection, male and female, 2009……………………… 40 Figure 4-3: Broadband usage indicators by enterprises, as percent……………………………… 42 Figure 4-4: Internet usage in enterprises by purpose, 2007-2009………………………………… 42 Figure 5-1: Baseline and broadband enhanced growth scenarios, real GDP 2009=100…………… 45 Figure 5-2: Turkey connectivity performance by scorecard component, 2010…………………… 46 Table 2-1: Major institutions and establishments in ICT sector………………………………… 15 Table 2-2: Broadband indicators, Turkey, 2010………………………………………………… 20 Table 2-3: Subscription indicators by technology……………………………………………… 21 Table 2-4: Prices of selected broadband service packages in Turkey, March 2011………………… 28 Table 3-1: Major e-government applications in Turkey…………………………………………… 32 Table 3-2: Top cities on Facebook……………………………………………………………… 37 Table 4-1: Internet activities of individuals who have accessed the Internet in the last 3 months… 41 Box 2-1: Recent strategies and initiatives related to e-government and broadband ecosystem…… 17 Box 2-2: Leveling the field: The battle of broadband in national market………………………… 23 v Acknowledgments The author of this report is Çagatay Telli from the State Planning Organization (SPO) of Turkey, with guidance from Michael Minges, who directed the case studies for the Broadband Strategies Toolkit. This case study was commissioned by Tim Kelly (infoDev) and Carlo Rossotto (ICT Sector Unit of the World Bank Group). Thanks are due to Samhir Vasdev for editing and preparing the document for publication. A number of people contributed to this study by participating in expert meetings and interviews and providing up to date information on the national broadband ecosystem, its relative strengths and challenges faced for future growth. Most notably Ertugrul Karacuha (Vice Chairman, Information and Communication Technologies Authority), Ahmet Hasanbeseoglu (Regional Director, Cisco), Ugur Terzioglu (Manager, Cisco), Ahmet Kaplan (Vice President, TURKSAT), Pasa Yasar (President, ENVITEL), Ramazan Altınok (Head, E-Government Group, Prime Minister’s Office), Emin Sadık Aydın (Head of Information Society Division of SPO), and Furkan Civelek (Planning Expert, Information Society Division of SPO) commented on the draft report. This case study is one of an initial series of seven that will contribute to the Broadband Strategies Toolkit, an online resource for policy-makers and regulators, especially in developing countries (see www.broadband-toolkit.org). The Toolkit and its case studies are generously funded by the Korean Trust Fund (KTF) on Information and Communications for Development (IC4D). The KTF is a partnership between the government of the Republic of Korea and the World Bank Group whose purpose is to advance the ICT4D agenda to contribute to growth and reduce poverty in developing countries. The KTF, as well as Philippe Dongier, Sector Manager (TWICT) and Valerie D‘Costa, Program Manager (infoDev), are owed the author‘s gratitude for their support and guidance on this project. vi Executive Summary Turkey has throughout history been prominent foreign policy resulting in large sums of overseas as a center of commerce because of its land capital flowing into the country. connections to the continents of Europe, Asia Communications, software and hardware and Africa and the sea surrounding it on three segments of ICT industries have expanded sides An Organization for Economic rapidly. This has included significant investment Cooperation OECD member, it has been in upgrading mobile networks to broadband. awaiting European Union (EU) membership Broadband mobile networks were only launched since 1987. As an upper-middle-income in 2009, yet by the end of 2010 around a quarter economy, Turkey suffers from comparison with of the population were capable of accessing these mainly high-income groupings. Its fixed high-speed wireless services. broadband penetration stood at 9.4 subscriptions per 100 inhabitants in June 2010 The Turkish population has also reacted to compared to the OECD average of 24.2 and social networking in a major way. The country is 34% of Turkish homes had a broadband the fourth largest Facebook market in the world. connection compared to the EU average of 61% Turkey’s own social media content is growing in 2010. and Turkish web sites are becoming more popular and increasingly diversified. These statistics disguise the fact that, compared to other countries in its income group, Turkey is Nevertheless the country continues to face doing relatively well. E-government initiatives economic and social barriers to effectively have been a major driving force for development absorb broadband technologies on a large scale of the broadband ecosystem. This has triggered and better utilize them for leveraging overall demand by enterprises in the ICT sector and economic competitiveness. Fixed broadband motivated citizens to increase Internet usage. competition is limited and dominated by ADSL Ensuring a shared vision among political leaders technology. ICT skill gaps among small and and technocrats has also been an important medium enterprises and the less educated need factor in pushing e-government programs. to be adequately addressed with participation of Political leaders saw e-government as a central private initiatives. The lack of a suitable national instrument that would support public reforms accounting framework for more detailed analysis and larger changes in the political system. A hinders international benchmarking in ICTs and central organizational structure was formulated innovation. to develop strategies and put public money into If Turkey can overcome these barriers, the the pipeline for a set of strategically important results could be considerable. According to the projects with high value and high transaction. National Broadband Vision study, broadband The high tempo growth of Turkish economy in could boost economic growth by 0.8-1.7 the last decade is another supportive factor. The percentage points per year. This economic various market-oriented reforms have been momentum enabled by an enhanced broadband implemented complemented with a proactive ecosystem would create 180,000-380,000 new jobs each year. 7 1 Turkish ICT Sector: A General Assessment 1.1 Background Geographically, the Republic of Turkey is located at a point connecting the continents of Europe, Asia and Africa. Because of its geographical location the mainland of Anatolia possesses an extraordinary geo-strategic value. In the past, it was an important expansion post to many great political powers including Hatti, Hittite, Ancient Greek, Urartu, Phrygia, Ionia, Persia, Roman, Byzantine, Arab, Seljuk and Ottoman. It has also been prominent as a center of commerce because of its land connections to three continents and the sea surrounding it on three sides (Figure 1-1). Modern Turkey was founded in 1923 by Mustafa Figure 1-1: Geographic position of Turkey Kemal following the collapse of the 600-year-old Ottoman Empire. After a period of one-party introduce substantial political and economic rule, since the 1950 election, Turkey has reforms. After intense bargaining, EU experienced a democratic political system based membership negotiations were launched in on multi-party politics. Turkey became a October 2005. European Union (EU) candidate country in 1999 and, in line with requirements, went on to Turkey has two levels of government and several types of administrations: National administration Figure 1-2: Global Competitiveness Index, Turkey, 2010 (Source: Global Competitiveness Index, 2010) 8 with ministries and agencies at the central Foreign Direct Investment (FDI) flows.3 government level and field offices in provinces According to the figures the Turkish economy and districts. Local governments include 3,225 started to absorb growing amounts of foreign municipalities in areas with dense populations capital and it ranks before many similar and 81 special provincial administrations with developing economies such as Chile, Greece, jurisdiction beyond municipal boundaries. In the Korea, and Israel. The average level of FDI last few years Turkey developed another inflows was around just US$ 100 million organizational structure to initiate a more throughout the 1990s. Today with an annual diversified and flexible decision making system average of around US$ 15-20 billion, Turkey is to support endogenous growth of its economic the 15th most attractive destination for FDI in regions by introducing Development Agencies. the world. 4 Currently 26 Development Agencies have From a traditional agricultural and low value become fully operational. added industrial configuration Turkey has With an increasingly urban population of around transformed into a dynamic and sophisticated 75 million1 and a GDP per capita of around economy. While services account the larger share US$10,000 in purchasing power parity, the in national value added with 43%, industry Turkish economy is largely developed. claims 11%, and trade, transport and Benefiting from both a capable and young labor communication sectors each have 8% shares. force2 and diverse natural resources the country Agriculture accounts for only 5% of total is among the world's leading producers of production. agricultural products; textiles; motor vehicles, After its recent aggressive growth records, ships and other transportation equipment; Turkey’s GDP doubled reaching above USD construction materials; consumer electronics and 650 billion in 5 years. Following the recent home appliances. Turkey has a rapidly growing economic downturn Turkish economy proved to private sector not only in industrial activities but be resilient and showed a strong rebound. also in competitive services such as banking, According to estimates GDP growth in 2010 transport, tourism and communications. should be very strong, and be probably among Following the financial crisis in 2001 major the highest in the OECD and EU areas at an economic reforms were launched and annual rate between 7-8%. 5 successfully fulfilled. The monetary, fiscal and A number of challenges loom in the horizon. In financial reforms implemented in the 2000s a world of highly connected economic and made Turkey’s macroeconomic framework very political interdependences and growing robust. The economy rebounded rapidly and uncertainty, raising overall productivity and economic restructuring was transformed into competitiveness is the key to Turkey’s economic strong and sustained growth. This profile of success in the long run. For sustained economic macroeconomic path was confirmed by performance, major elements of the policy mix impressive figures: real GDP growth leading the are maintaining the predictability of OECD and Euro area, inflation rates coming macroeconomic policies, reducing capital and down to single digit levels sharply, strong fiscal employment costs, supporting employment adjustment and large inflows of capital rushing levels, and financing external imbalances with into the country. resilient resources such as FDI. Internalization and underlying dynamism of the economy can be best reflected by the fact that Turkey has lately become a major destination for 3 For more information on general investment climate in Turkey also see The World Bank (2010), Turkey Investment Climate Assessment: From Crisis to Private 1 More than 70 percent of the Turkish population is Sector Growth. This report draws on the analysis of firm- concentrated in urban areas and Turkey ranks among the level survey data collected during April 2008-January 2009, leading countries in terms of urbanization rate. Source: supplemented by other sources, to provide a Turkish Statistical Institute, comprehensive and up-to-date description of the http://www.turkstat.gov.tr/PreTablo.do?tb_id=39&ust_id investment climate facing Turkish firms of all size classes, =11 and OECD (2010) Factbook: Economic, including the impact of government regulations. Environmental and Social Statistics, Paris. 4 UNCTAD (2008-2010), World Investment Prospects 2 The median age of the country is 28.8 indicating a Survey. concentrated structure of young population in the total. 5 According to the January edition of the Global Economic More than 60 percent of total population is below 35 age. Prospects 2011 report prepared by the World Bank, Source: Turkish Statistics Yearbook (2009), Address Based Turkey’s gross domestic product (GDP) growth is expected Population Registration System Population Census Results. to register 8.1 percent for 2010. 9 45,0 40,0 35,0 CAGR of ICT Spending 30,0 25,0 20,0 15,0 10,0 5,0 0,0 Figure 1-3: Fastest growing economies in ICT spending, 2003-2009 (Source: OECD database, Economist Intelligence Unit and EITO. The aggregate for Turkey is calculated for the period 2005-2009) The Turkish economy needs microeconomic 1.2 ICT Sector reforms to upgrade its productive potential. Information and Communications Technologies In the Turkish case, the lack of a suitable (ICT) have shown positive and significant effects national accounting framework for more detailed on economic growth and are recognized to be analysis hinders international benchmarking in among most critical general purpose most emerging policy areas notably ICT and technologies which have great transformative innovation. There still remains a persistent potentials. In the current economic information gap on this issue following many environment, policies and investment that reforms in the national statistical system. The promote and accelerate ICT adoption can have Turkish national accounts do not provide an important role to play and improve the information about the size of ICT sector in country’s competitiveness. terms of value added or jobs. Nevertheless utilizing other indicators, it is estimated that According to Global Competitiveness Index, Turkey’s ICT sector accounts for a lower share (2010), Turkish economy is positioned between of economic production activities compared to innovation and efficiency driven stages of advanced industrial economies but has a very development (Figure 1-2). It is an open market robust growth potential. economy in structural transition facing fierce competition in traditional sectors like textile, Market size and ICT spending are among the agriculture, light machinery and automobiles available indicators for comparison. Turkey was from other developing countries like China and placed 13th in the list of highest spending India. Raising productivity and supporting countries within the OECD in 2007 with innovation in these sectors will be of critical spending of USD 36 billion or 6.8% when importance to keep its competitiveness intact. compared to GDP. Various institutions put Therefore in order to make a successful leap forward similar estimates concerning the Turkish from an efficiency-drive to an innovation-driven ICT sector. However estimates vary and a economy, the Turkish economy needs to commonly agreed figure is still unavailable. In upgrade traditional sectors and harness the the absence of official statistics analysts transformative potential of ICTs. frequently rely on business intelligence data provided by different consulting companies. 10 Computer hardware Computer software Computer services Communications 25% 2% 3% 70% Figure 1-4: The composition of ICT spending in Turkish economy, 2009 (Source: SPO 2010, Information Society Statistics, Ankara; based on data provided by IDC. Even the State Planning Organization (SPO) higher in European markets, being 519 per 1,000 uses these estimates in its official documents and people in Italy, 725 in Germany and 766 in reports. According to the SPO the size of the France. The temporary value-added tax (VAT) ICT market in Turkey was around US$ 20-25 reduction on consumer durables, introduced in billion in 2009. 6 Turkey ranks among the highest March 2009 in the Turkish market to counter growth countries in ICT spending (Figure 1-3). the impact of the financial crisis, augmented the sales of PCs and laptops in 2009.9 The Turkish ICT sector has a great potential for growth. The ICT market experienced double- Leading multinational enterprises, such as IBM, digit growth over the last ten years since the Hewlett-Packard, Dell, Siemens, Cisco, and financial crisis the country experienced in 2001, NCR, have considerable shares in domestic IT but the share of software and services is market. These firms typically operate through significantly behind Western markets, indicating their local subsidiaries, which assemble PCs and substantial growth potential. 7 other IT hardware components imported from overseas. Sales are realized both domestically The Turkish ICT market is dominated by and for export to the EU, Eastern and Central communications, constituting approximately 70 Europe, and the Middle East. percent of the total and the whole IT market, which constitutes the hardware and software Computer services and computer software have categories, comprising the other 30 percent.8 a much lesser role in the Turkish economy because of lower business use of ICTs and the The computer hardware segment is the second rapid growth of mobile and other consumer largest part of the ICT sector with a 25% share communication services. In contrast more following communications. The penetration rate of personal computers (PCs) has grown rapidly and reached levels of 253 per 1,000 people in 2009 from 92 per 1,000 in 2006. This figure is 9 Economist Intelligence Unit (2010). The reduction in 6 SPO (2010), Information Society Statistics, Ankara value added tax (VAT) on consumer durables, introduced (Turkish). in March 2009 to combat the impact of the financial crisis, 7 Turkey Invest’s ICT sector information at boosted PC and laptop sales. The number of PCs per 100 http://www.invest.gov.tr/en-US/sectors/Pages/ICT.aspx population is expected to rise to 38 per 100 population as 8 SPO (2010) Information Society Statistics, Ankara. of 2014. 11 Imports Exports 4.000 2.000 0 2004 2005 2006 2007 2008 2009 -2.000 -4.000 -6.000 -8.000 -10.000 -12.000 Figure 1-5: Evolution of ICT foreign trade in Turkish economy, US$ million, 2004-2009 (Source: Undersecretariat of Foreign Trade –Export Promotion Center, IGEME) sophisticated economies have a somewhat larger electronics and computer hardware. In 2009, share of computer services and software. 10 while the Turkish economy exported US$ 472 million computer hardware products it imported While being relatively less important and at its US$ 4,444 million of the same goods leading to a early stage of progress, the software industry is US$ 3,972 million trade imbalance. among the fastest developing and most promising sectors in the country. Over the last The ICT sector plays a significant role in terms two decades, the sector has gained great of employment creation opportunities and momentum in terms of capacity, production and generation of R&D demand in Turkish usage. According to some analysts, the software economy. According to the latest available data, industry accounts for a much larger share in the direct employment by the ICT sector was total IT market than previously thought. It is 160,644 in 2006. 12 Including employed people estimated that national software market reached with ICT skills by other industries, a broader US$ 1.6 billion in 2009 with double-digit growth definition of “ICT related employment� over the last years.11 indicates the sector provides much larger opportunities for job creation: the percentage Turkey has rapidly developed its international share of ICT related employment in total linkages in the ICT sector. Export and import employment was above 10 percent in 2006. A volumes in the ICT sector have reached to US$ considerable and steady increase in this figure 3.27 billion and US$ 9.05 billion respectively as has been observed over the recent years and it of 2009 (Figure 1-5). In terms of international reached to 10.8 percent of total employment as trade balance, the Turkish economy is positioned of 2009. to be a net importer of ICT goods and services due to mainly being a large market for consumer 10 For further reading on market segments of ICT spending please see OECD (2008), Information Technology Outlook, Paris, pp. 56. 11 Source: Interpromedya (2009), ICT Market Research. 12Source: TURKSTAT Annual Industry and Service Please see www.interpromedya.com.tr Statistics Survey 12 2 Turkey’s Broadband Ecosystem: A General Assessment This section develops a country snapshot of the investments in wire line at US$ 560 national broadband ecosystem in a historical, million per year and wire line institutional and economic context. Different penetration reached 28 percent. There aspects of national broadband adoption will be were several unsuccessful attempts to covered such as infrastructure, services, market privatize Turk Telekom. environment, applications and usage. 4. Preparation for liberalization (2000 to 2004): This period is characterized by 2.1 Synopsis of Recent Evolution of maturity in wire line and decelerated Markets and Public Sector growth and increased competition in Reform wireless. Two GSM 1800 MHz licenses Reform and structural change in the overall ICT were auctioned in May 2000, at a and broadband sector started early with the most substantially higher fee (close to US$ 3 important segment of telecommunications. The billion including VAT, compared to growth and evolution of the Turkish telecom US$ 500 million for the initial licenses industry in the last 30 years had five separate bought in 1999) to end the revenue- phases: sharing agreements. The Telecommunications Law in 2000 established an independent regulator, 1. Infrastructure pickup (1980 to 1984): the Information and Communication Network infrastructure buildup was a Technologies Authority (ICTA) and priority and public investments played a predetermined full market liberalization major role in this period. As a result, the starting from January 2004. number of access lines grew by 14 5. The period of post liberalization and percent on average; however, despite broadband revolution (2004-...): The the acceleration in telecom investments government maintained its full support and growth in the subscriber base, long for liberalization and privatization of the waiting lines remained during this time. telecommunications sector. The 2. Fast wire line growth (1985 to 1994): ownership of Telsim, a privately owned The late 1980s was a period of ongoing telecom operator, was transferred to the intense infrastructure investment and government after its owners were fast growth. During this period, the convicted of fraud. The operator was government’s annual afterwards privatized in an international telecommunications investments tender won by Vodafone in December averaged US$ 656 million and access 2005. 3G mobile licenses were awarded lines grew by an average of 20 percent to all three operators, Turkcell, annually. Also, the PTT (“Posta Telefon Vodafone and Avea, in 2008 and Telegraf�) was split into postal services services began in 2009. This period is and Turk Telekom. Two GSM 900 also characterized with increasing licenses were granted in 1993 to competition, declining fixed line Turkcell and Telsim, with revenue penetration and falling voice revenues. sharing agreements with Turk Telekom. Broadband, both fixed and mobile, have become a major source of revenue and a 3. Wireless revolution (1995 to 1999): The general technological platform for late 1990s were characterized by overall communication services. explosive growth in wireless phone subscriptions. In 2000, annual As a result of structural policies in order to subscription growth exceeded 100 liberalize the market competition flourished, new percent, and wireless phone penetration entrants emerged as strong operators and reached 25 percent. Average annual foreign capital flew into the country.13 investment in the wireless subsector was more than US$ 1 billion. During this period, the government continued 13 The incumbent operator of the telecommunication sector is Turk Telekom. The legal monopoly of Turk Telekom in 13 Nonetheless a distinction should be made 2.2 Institutional Setup: Current between fixed and mobile segments of Policy, Legal and Regulatory communications. As to the national market, the Framework fixed and mobile subsectors have radically Table 2-1 exhibits major institutions and dissimilar configurations in terms of establishments that are involved in the ICT and productivity, liberalization, and ownership. broadband sector. The State Planning Mobile is more competitive and productive, with Organization (SPO) is the leading institution a more advanced regulatory structure. On the regarding government policies and strategies for other hand, in the fixed subsector, productivity the overall ICT sector. It prepares pivotal is relatively low.14 national strategies and programs such as As observed in many other developed and development plans, economic programs and saturated markets, fixed-line penetration is in sector strategies and action plans. SPO is also continuous decline since its peak period of 2001- involved in resource allocation to e-government 2004. Consequently, the penetration rate is down projects and applications and has access to to 23.3 percent in 2009, from around 28 percent private sector organizations through various in 2004. The penetration is low compared to EU mechanisms. The Office of the Prime Minister countries, for example 37 percent in France, 43 has lately become a significant coordinating and percent in Germany, 46 percent in Greece and a consulting body in terms of e-government 31 percent in Hungary.15 The Turkish mobile initiatives. In regards to ICT related research and telecommunications segment has achieved a determining the national agenda for general considerable growth with a share of 60 percent science and technology policies the Scientific within total sector revenue in 2008 and is and Technological Research Council expected to continue growing. Mobile number (TUBITAK) is the main body. portability (MNP), launched in November 2008, The Ministry of Transport and Communication as well as 3G mobile services introduced in July (MoTC) is responsible for sector oversight in the 2009, have accelerated the competition between provision of public services including the three market players. information and communications to the end Analysts forecast mobile virtual network users. The MoTC is also the top official body on operators (MVNO) are also expected to start issues of safety, quality, standardization and operating in the market along with the three balanced development of the communications mobile operators. Mobile-phone subscribers are infrastructure. The Information and Communications expected to grow at an annual rate of 5.5 percent Technologies Authority (ICTA), founded in 2000, between 2010 and 2014, following a fall of 0.5 has the overall regulatory responsibility over percent in 2009. This will increase the mobile- communications sector. phone penetration rate in Turkey to about 113 A number of non-governmental organizations percent in 2014, similar to most EU countries, are also involved in the general direction and where penetration rates are generally around structure of the ICT sector. The most influential 100-120 percent. establishments include the Turkish Informatics Association (TBD), Informatics Sector Association (TUBIDER) and Turkish Informatics Industry Association (TUBISAD). Turkey’s public sector has a tradition of passing legislation rather than using secondary regulations to interpret basic laws. In an attempt the field of fixed line telephone services ended in 2004 and the sector was opened to full competition. Since then, many to liberalize communications, to regulate operators entered the sector to operate in the field of fixed provision, diffusion and usage of information line telephone services. 55% of the public shares in Turk and enable e-transformation different legislation Telekom were privatized in 2005. As regards to mobile was enacted throughout the 2000s. As to the subsector services started as early as 1994 and currently three operators, namely Turkcell, Vodafone, and Avea, are legal framework in effect (or pending) the operating in the field of mobile communication. following documents constitute the fundamental 14 McKinsey Global Institute (2003), Turkey: Making the architecture for the nation: Productivity and Growth Breakthrough 15 According to the analysts the outlook for fixed-line telephone penetration does not look promising. Fixed-line penetration is expected to decline to 19 telephone main lines per 100 people by 2014. 14 Institutions Abbreviations Functions Web pages Office of the Prime Minister coordinates numerous e-government projects, gives advisory services to Office of the Prime Minister NA NA implementing agencies, encourages the adoption of ICT by public institutions. MoTC is to provide the production and the control of quality, balanced, safe, environmental friendly, fair Ministry of Transport and Communication MoTC and economic transport, information and communication services for all users. www.ubak.gov.tr SPO provides general vision and strategies including ICT sector, integrates these specific visions into The State Planning Organization SPO broader economic programs and coordinates the implementation process. SPO also approves public investment projects including ICT and e-government applications. www.spo.gov.tr BTK prepares plans in telecommunication sector according to Wireless, Telephone and Telgraph Law . Information and Communication Technologies Authority BTK Then BTK presents the plans to MoTC. BTK also regulates and audits tellecommunication market. www.tk.gov.tr Turksat A.S. is the only satellite operator company in Turkey. Turksat manages and operates three satellites International Satellite and Cable Operator TURKSAT (Turksat 1C, Turksat 2A, Turksat 3A) and provides all types of satellite communications. www.turksat.com.tr The Scientific and Technological Research Council of Turkey (TÜBİTAK) is the leading agency for The Scientific and Technological Research Council of Turkey TUBITAK management, funding and conduct of research in Turkey. It was established in 1963 with a mission to advance science and technology, conduct research and support Turkish researchers. www.tubitak.gov.tr TBD is a non governmental organization w hich was established in 1971 to expand Informatics Culture by Turkish Informatics Association TBD members. www.tbd.org.tr TUBIDER IT Sector Association was founded in November in 1999 so as to protect rights and interests of the IT companies operating in the informatic sector and to ensure vocational regulations are implemented. Informatics Sector Association TUBIDER TUBIDER continues its operations having reached to 800 registered members and more than 1500 applicants. www.tubider.org.tr Established in 1979, TUBISAD is the largest non-governmental organization of the Turkish private ICT sector, including industries and services, with a representation base of 95 % through its direct membership. TUBISAD has a group of members comprising of almost 180 leading ICT companies of which Turkish Informatics Industry Association TUBISAD are Software Developers, Hardware Manufacturers, Hardware and Software Distributors, Telecommunication Companies, System Integrators, Local Subsidiaries of IT and Communication multinational companies and/ or Consultants. www.tubisad.org.tr General Directorate of Postage and Telegraph Organization PTT Postage and telegraph services are operated by General Directorate of PTT. www.ptt.gov.tr Table 2-1: Major institutions and establishments in ICT sector 15  In the field of Information Society: of the first organized action in the Right to Information Law (2003), public sector. However the succession Inclusion of cybercrime in the Criminal of governments; high inflation and Code (2004), Electronic Signature Law recession; and political and economic (2004), Amendments in the Intellectual instability prevented much Property Rights Law, Universal Service implementation from taking place. Law (2005), Law No. 5651 on regulating  The era of e-government (2000-2010): broadcast in Internet and combating Political stability with Development and crimes committed through such Justice Party rule following 2002 and broadcast (2007), Electronic negotiation process with the EU helped Communications Law (2008), and government agencies to devise more secondary legislation on integrated and organized frameworks telecommunications. for action which included active participation of private sector and non- governmental organizations. The E-  In the field of IT and e-government: Transformation Project and the Public Procurement Law (2008), Census Information Society Action Plan are Services Law, Law No.5942 good examples of this period. The amendments in the Traffic Law overall goal in these documents was No.2918, Circulars regarding the defined as promoting Information payment of taxes online, Draft Data Society polices to increase Turkey’s Protection and Privacy Law (pending in competitiveness. A further goal was to the Parliament), e-Commerce studies move from labor-intensive production regarding the harmonization of 2000/31 to a higher-value-added production and EC, and Draft law covering partial from providing a source of low-cost amendments for various e-government labor to a highly educated workforce in services.16 a knowledge based economy. However Box 2-1 gives a quick snapshot of major national going beyond rhetoric, the real focus strategies and initiatives targeting e- was on implementing e-government transformation in the public sector and applications and demand aggregation broadband adoption at large. Evolution of policies rather than promoting e- public policies with regard to Internet based commerce and the digital economy. technologies and e-transformation can be  Beyond e-government (2010-…): With analyzed under four distinct periods: increasing diffusion of ICTs into  Data processing and computerization business applications and government (1970-1990): During this period the operations, there are now new signals focus of public policy was mainly on calling for a shift in public policies. automating back-office functions, such Growing businesses are in clear need of as processing of the census and taxes. accelerated ICT adoption to leverage their competitive power. The high level  Building basic ICT capabilities (1990- of investment in e-government 2000): In the 1990s, there emerged an applications is clearly just one effort to provide basic ICT facilities and component of modernizing the public capabilities from a modernization sector. To better harness the perspective of the government sector. transformative potential of ICTs The “Turkey: Informatics and government agencies are now starting to Economic Modernization� project of look beyond e-government. The the World Bank in 1993 was an initiator National Vision for Broadband Strategy in this sense. In the second half of and updating studies of the Information 1990s the National Informatics Society Strategy provide good Infrastructure Main Plan of the Ministry illustrations of this process. of Transportation was an early example 16For a more detailed discussion please see OECD (2007) E Government Studies: Turkey, Paris. 16  “Turkey: Informatics and Economic Modernization� report was prepared by the World Bank in 1993.  The Ministry of Transportation published “the National Informatics Infrastructure Main Plan� (TUENA) in 1998. The plan aimed at developing policy actions and strategies for enabling transition to an Information Society. The Internet Advisory Council and The E-Commerce Coordination Council were established in the same year.  Turkey joined the eEurope+ Initiative, together with other EU candidate countries, in June 2001. Soon after, Turkey started the eTurkey Initiative, which includes the same goals as eEurope+.  A new government of the Justice and Development Party (AKP) took office on 18 November 2002. The Urgent Action Plan (UAP) was developed. This plan included the foundation of the e-Transformation Turkey Project. The Project initiated in February 2003 with Prime Ministry Circular. The State Planning Organization (SPO) was assigned to co- ordinate the e-Transformation Turkey Project. To realize the stated objectives and to ensure the success of e-Tr, a new co-ordination unit, the Information Society Division, was established in SPO in March 2003.  Within the framework of e-TR two action plans were executed: Short Term Action Plan (STAP) with 73 actions (2003-2004) (completion rate: 47%), 2005 Action Plan with 50 actions (2005) (completion rate: 40%)  Information Society Strategy (2006-2010) and Action Plan were developed by SPO and took effect by a High Planning Council decision on 11 July 2006. A new institutional structure was formed by introducing e-Transformation Turkey Executive Board, e- Transformation Leaders and an Advisory Board.  Prime Minister’s Office prepared the countries first National Broadband Vision in cooperation with relevant stakeholders and participation with private sector. The National Broadband Vision under three versions (Turkish, English and Arabic) is to be published before end March 2011.  SPO commenced studies to update its Information Society Strategy and Action Plan to finalize before end of 2011, and decided to arrange a separate chapter on broadband ecosystem. Box 2-1: Recent strategies and initiatives related to e-government and broadband ecosystem (Source: Interviews with Dr. Ramazan Altınok, Dr. Ertugrul Karacuha, Emin Sadık Aydın, Furkan Civelek, Ahmet Hasanbeseoglu and Ugur Terzioglu). Turkey faces a new window of opportunity with flourish rapidly, providing good infrastructural regard to upgrading competition and capacity has been a key policy concern among productivity by means of better ICT adoption. government officials. Evaluating infrastructure Promoting and creating a viable broadband developments require analysts to monitor a ecosystem is the key to success. The country can number of indicators at the same time since any either let the market determine the pace of single dimension will not be sufficient to provide development or promote a more rapid a complete picture. development of broadband infrastructure, as has Broadband is typically defined as a “high-speed been done in advanced countries. Defining, communications network� that offers internet monitoring, and promoting the broadband connectivity with download speeds of at least ecosystem with effective means is an important 256 kbit/s. 17 This definition based on the area where more focus should be devoted. minimum level of speed is a matter of debate though it is clear that broadband technologies 2.3 Infrastructure Development One of the fundamental aspects of broadband ecosystems is broadband infrastructure. As 17 http://www.oecd.org/document/46/0,3343,en_ broadband technologies and applications 2649_34225_39575598_1_1_1_1,00.html 17 are significantly different from dial-up lines in Studies indicate that, though the relationship is terms of functioning. No distinct definition for not necessarily casual, per capita income is broadband exists in Turkey. correlated to fixed broadband penetration with a significant correlation coefficient of 0.70. Since Three basic criteria are incorporated to provide the Turkish economy has depicted a strong an integrated picture of Turkish broadband rebound in the post crisis environment and development: Penetration, technologies and medium to long-term outlook is promising, prices. A benchmarking technique is utilized in rising per capita income levels should establish a order to obtain a better picture of the relative major driver force for broadband infrastructure performance of national broadband capacity development. both across countries as well as over time. In isolation, there is a tendency to view national Turkey faces a challenge in order to catch up growth rates as high, since, as with any new with OECD members in broadband technology, growth is often in the double digits. technologies. Despite growth in broadband infrastructure, when compared to advanced 2.3.1 Broadband penetration countries, Turkey has recorded somewhat poor Overall performance in making broadband an performance and has not been able to close the essential part of daily life has been uneven and broadband gap. As of the second quarter of subject to significant variations among nations. 2010, in terms of fixed broadband technologies The divide in performance of countries is best the leading countries reached penetration levels reflected by the concept of broadband penetration above 35 percent while Turkey managed only a gap. The broadband gap is defined as the 9.4 percent subscription based penetration rate. discrepancy between benchmark countries and that of host country in terms of adoption of Turkey’s fixed broadband growth rate is lagging broadband technologies generally measured in the OECD area. During 2010 Turkish fixed household or population penetration. In the case broadband growth was 0.83 percent compared of Turkey, there is a significant fixed broadband to the OECD average of 1.72 percent (Figure gap as compared to other OECD members 2-2. When compared to major developing (Figure 2-1). economies, Turkish broadband growth is considerably lower; for instance India is A number of factors are important in expanding its broadband capacity with a growth determining penetration rates but as a general of 62 per cent in 2010. observation countries with relatively high fixed broadband penetration rates tend to have Nevertheless the fixed broadband penetration relatively higher per capita GDP and well rate in Turkey still exceeds some European developed communications infrastructure.18 Broadband gap among selected countries and Turkey through, June 35 France 30 Germany 25 United Kingdom 20 Canada 15 United States 10 Japan 5 Turkey 0 Italy S Figure 2-1: Fixed broadband penetration gap with selected countries, 2010 Source: OECD broadband portal and author’s own calculations) OECD (2008), Broadband Growth and Policies in 18 OECD Countries, Paris. 18 5 4 3 OECD net increase 2 1 0 -1 -2 -3 Source : OECD Figure 2-2: Fixed broadband (per 100 inhabitants), net increase, June (2009-2010) (Source: OECD) Fixed Line Mobile Fixed Broadband 100 90 80 70 60 50 40 30 20 10 0 2002 2003 2004 2005 2006 2007 2008 2009 Figure 2-3: Selected penetration indicators, per 100 inhabitants (source: author) countries such as Poland, Italy, Bulgaria and in Turkey are expected to create opportunities Romania, and is very close to the rates in for the broadband market.19 Portugal, Hungary, Spain and Estonia. On the Turkey’s relatively well-developed mobile other hand, the personal computer (PC) network has a penetration level around 85 penetration level in Turkey in 2009 was only percent and provides another means for about 25.3 percent, compared to 77 percent in broadband access (Figure 2-3). Wireless the UK. Since broadband usage depends on PC broadband has shown a significant expansion penetration, increasing PC usage and ownership 19 Economist Intelligence Unit, 2010. 19 Penetration Item Subscriptions (per 100 Comment people) Fixed and mobile through data Total broadband 8,516,898 11.6 cards Fixed broadband 7,068,878 9.6 ICTA. ADSL, Cable modem, FTTP ICTA. Technical ability to access mobile broadband without 3G subscriptions 19,400,000 26.3 consideration of whether actively using to access Internet Mobile broadband 1,448,020 2.0 ICTA data cards % of households Households with Turkstat computer - Desktop 33.8 Turkstat - Portable 16.8 Turkstat Households with 41.6 Turkstat access to the Internet Households with broadband access to 34 Eurostat the Internet - of which DSL 30.5 Turkstat Table 2-2: Broadband indicators, Turkey, 2010 (Source: Adapted from ICTA, Turkstat, Eurostat) (note: Subscription penetration calculated based on population of 73,722,988 reported by Turkstat at December 31 2010) following the decision of Turkish government to profits.20 There has been a considerable growth issue 3G licenses during November 2008, in the investments to mobile subsector and more making the market an appealing area for future importantly telecommunication operators have investment. Since then 3G mobile Internet changed their strategy significantly by allocating subscriptions using data cards have grown at a increasingly far more resources to mobile rapid pace and as of end 2010 reached 1.5 investments. Building up of 3G communication million subscriptions (total 3G subscriptions infrastructures constitutes a determining factor reached 19.3 million as of December 2010 for this shift in corporate strategies. according to ICTA). The annual rate of growth Experiences in many countries show that in this segment of broadband was 265 percent governments should leave the choice of between 2009 and 2010. As a result mobile technology and infrastructure expansion as broadband is growing much faster than fixed much as possible to market forces while broadband subscriptions (27 percent annual promoting a level playing field for different growth as of 2010). Total fixed and mobile technologies. Turkey is implementing a policy of broadband through data card subscriptions reached 8.5 million by the end of 2010. A saturated voice market with declining revenues 20 The revenues from broadband access services provided has motivated operators to rely on mobile from the fixed network are rapidly increasing. Parallel with broadband network investments for optimizing the decrease in the number of fixed line telephone subscribers, the revenues from these services decreased by 17.5% between 2006 and 2009 and the revenues of mobile telephone services increased by 24.4% during the same period. 20 Table 2-3: Subscription indicators by technology (Source: ICTA) increased competition through the privatization considerable internal changes as users upgrade of its incumbent telecom operator (55% was their connections with faster speeds. This sold to the private sector in August 2005) and section helps to illuminate Turkish broadband implementing rules to increase competition such development from a technological perspective. as providing competitors access to telephone lines.21 Yet this policy was not transformed into 2.3.2.1 Backbone network increased competition and a high rate of growth Until recently there have been two main in broadband infrastructure. Alternative technologies or platforms over which broadband operators accounting for only 7 percent, the services have been delivered to consumers. The level of competition in fixed broadband access is first is Digital Subscriber Line (DSL) which still very limited.22 entails upgrading the legacy public switched As the National Broadband Vision (2010-2023) telephone network (PSTN). The second highlights, if Turkey wants to develop its platform consists of the cable-modem broadband ecosystem rapidly and close the technology, which entails upgrading the cable-tv broadband penetration gap with advanced network. economies the government should follow an integrated and strategic approach in terms of 2.3.2.2 Local access technologies broadband policy. 23 Waiting for growth in There has been an impressive shift away from household demand for high-speed Internet dial-up Internet connections to broadband. In access to encourage the development of 2005, dial-up connections still accounted for 40 broadband will take time. The public sector per cent of fixed Internet connections but had should consider taking a more pronounced role already fallen to just 10 percent by 2010. in stimulating the development of broadband In Turkey, xDSL is the most widely used infrastructure and using this capacity for technology accounting for 94 per cent of modernizing the public sector. broadband subscribers.24 While 3.9 percent of 2.3.2 Broadband technologies the subscribers use cable networks and 2 percent Penetration data does not deliver enough of subscribers have fiber technologies for information about the quality improvements in broadband access the number of xDSL the broadband infrastructure. While the growth subscribers has touched to 6.6 million by end of rate is slowing down there may still be 2010. When compared to EU countries Turkish broadband is relatively far more concentrated on conventional technologies like xDSL. 21 In March 2010, Oger Telecom declared its interest in acquiring an additional share of the Government's stake in TT. The Turkish Government plans to divest a further 15- 20 per cent of its stake via an initial public offering. The remaining 15 per cent stake in the operator is already listed on the Turkish stock exchange. 22 Source: SPO (2010) Information Society Statistics. 23 Office of the Prime Minister (2010) National Broadband 24ICTA (2009), Electronic Communication Sector in Vision, Forthcoming. Turkey, Market Statistics Report, February 2010, p. 20 21 Turkey EU ,100 ,94 ,90 ,79 ,80 ,70 ,60 ,50 ,40 ,30 ,20 ,15 ,10 ,4 ,2 ,2 ,4 ,1 ,0 xDSL Cable Fiber Other Figure 2-4: Technological configuration of broadband infrastructure, as percentage shares, 2010 (Source: author) <=512 Kbit/s 1 Mbit/s 2 Mbit/s 4 Mbit/s 8 Mbit/s > 8 Mbit/s 2% 4% 26% 2% 2% 64% Figure 2-5: Breakdown of fixed broadband subscribers by access speeds, 2010 According to the recent data there has been a percent) have an 8 Mbps connection. The share rapid shift away from lower speed connections.25 of the subscribers who have 1 Mbps connections The great majority of ADSL subscribers (64 has decreased dramatically from 42% to 26% in just six months of 2010. 25Source: Information and Communication Technologies Authority (2010), Communications Market Report, Ankara (In Turkish). 22 The incumbent Turk Telekom (TT) provides landline, mobile and Internet services. It launched ADSL services in 2003, and currently offers Internet services in selected regions through its subsidiary TTnet. In 2005 in a drive for privatization, the government sold a 55 per cent stake of TT to the Saudi-owned Oger Group. In March 2010, Oger Telecom declared its interest in acquiring an additional share of the Government's stake in TT. The Turkish Government plans to divest a further 15-20 per cent of its stake via an initial public offering. The remaining 15 per cent stake in the operator is already listed on the Turkish stock exchange. One of the key benefits of TT’s privatization is the fact that it has lost the special status of a state-owned company and as a result is obliged to follow the same regulations as any other Turkish telecoms operator. TT is likely to remain aggressive within the telecoms marketplace and in the regulatory process as it tries to maintain its leading position. Thus, the low level of competition in the broadband internet is partly due to the strategic behavior of Turk Telekom to prevent the entry of alternative Internet service providers. In most countries incumbent operators such as Turk Telekom have been under the regulatory obligation of allowing new entrants to use the existing network to provide their own DSL service In a landmark decision taken in November 2008, the Competition Authority has imposed a fine of 12.4 million TL (about €6.2 million) on Turk Telekom for abusing its dominance in the wholesale broadband Internet market through price squeeze in the retail Internet market. In its decision, the Competition Board stated that Turk Telekom and its Internet subsidiary TTNet endured operating without profits for long periods of time and implemented campaigns that would not cover losses in reasonable amounts of time and that these strategies were executed in order to monopolize the sector. In a recent decision the Competition Authority stated that Türk Telekom should provide naked DSL services. Provision of naked DSL means that Turk Telekom can no longer bundle voice and data services together and that the subscriber can subscribe to DSL services alone, without having to pay for voice services as well. In recent years Turksat with its UYDUNET cable services has increased its market share by winning some 274 thousand broadband customers as of 2010. However since the cable TV infrastructure is operational mostly in urban areas and lacking somewhat more effective business models the company has not made a major breakthrough in the domestic market. Another striking development was the introduction of 3G services which had a significant impact on the broadband sector. The three mobile operators, Turkcell, Avea and Vodafone, are trying to find new sources of revenue in anticipation of the difficulties associated with increasing subscriber numbers in the saturating market. All three won 3G licences in December 2008 and launched 3G services at the end of July 2009. Avea allocated TRY 1 billion to be spent mostly on 3G network development during 2009. Vodafone followed suit with a TRY 1.3 billion investment allocation. At the end of December 2010, there were 1,448,020 mobile broadband subscribers, showing a 265 per cent growth over the last 12 months. At the end of 2010, the number of customers on 3G networks reached 19.4 million With the emergence of alternative network technologies TT is now under pressure for adopting a more business oriented strategy rather than enjoying its domination in the fixed market. TT introduced its new Internet speed package days before 2011 which enables speeds of up to 32 Mbps with VDSL2 and up to 8 Mbps through ADSL. TT shall begin offering packages with speeds of up to 50 Mbps and 100 Mbps with VDSL2 technology, and shall increase the speed up to 16 Mbps with ADSL2+. TT will need to work hard to retain its market dominance however, as mobile operator Turkcell is investing in considerable fibre infrastructure through its subsidiary Superonline. Vodafone Turkey also bought a major alternative operator in late 2009. Another point is that EU candidacy is prompting Turkey’s telecoms regulator to strengthen the regulation of the sector and curtail TT’s monopolistic powers. Box 2-2: Leveling the field: The battle of broadband in national market (Source: Atiyas Izak (2010) Regulation and Competition in the Telecommunications Industry: An Update; and interviews with Dr. Ramazan Altınok, Dr. Ertugrul Karacuha, Emin Sadık Aydın, Furkan Civelek, Ahmet Hasanbeseoglu and Ugur Terzioglu) 23 Turk Telecom is leading provider of DSL and and became operational by July 2009. Since then owns all of fixed telephone infrastructure (16 mobile broadband subscriptions recorded an million connections in 2010). As of 2009 the explosive expansion. With some 1.45 million share of alternative operators reached to 6.3%. subscriptions (December 2010) and a growth Compared to the previous year, alternative rate of 265 percent, mobile broadband holds operators’ subscriber number increased by 29%. great promise for Turkey, particularly given the Currently two types of Local Loop Unbundling limited competition on the fixed market. Mobile (LLU) namely ‘full access’ and ‘shared access’ broadband provided over the UMTS platform have been implemented in Turkey. 163 central with HSPA extensions came relatively late to offices have been opened to access of alternative Turkey. The 3G market is benefiting from the operators by the end of 2009 under the LLU deployment of HSPA technology and by the regulations of the Authority. Currently introduction of new smartphones. Growth has alternative operators have technical access to been dramatic and mobile broadband accounted almost 7 million PSTN and 2.6 million ADSL for 17% of all broadband subscriptions by the subscribers via the above mentioned 163 central end of 2010. offices. Besides LLU, operators can offer Though the level of competition in fixed broadband Internet access services to their broadband is limited compared to more customers using Turk Telekom’s other wholesale advanced economies, with a broader definition broadband access services such as xDSL simple of broadband including the mobile segment, resale and xDSL bit-stream access (BSA) which Turk Telekom as the incumbent operator is enable ISPs to access the fixed broadband losing its market share rapidly. TT’s broadband network at different levels. Some promotional market domination has been somewhat campaigns including LLU in the above challenged by mobile operators’ (Turkcell, Avea mentioned wholesale access services have been and Vodafone) success in targeting mobile approved by the Authority upon Turk Telekom’s broadband customers and partly due to increases proposal in 2009. in cable and fiber subscriptions. TTNet’s market Co-location areas and problems encountered at share in the broadly defined broadband market central offices opened to access have been was down from 93% to 71% since early 2009. By observed within the central office surveys carried contrast the market share of mobile broadband out in June. Moreover the outdoor DSLAM operators grew explosively up to 17% following implementations of the incumbent operator are the opening of 3G services in the country. It is also observed. estimated that mobile broadband subscribers will occupy an increasingly prominent place in In accordance with the relevant legislation and Turkey’s broadband sector. These are broadband regulations, a Reference xDSL Resale Offer has customers who use devices such as netbooks, been offered to the Authority by Turk Telekom smartphones and USB sticks to connect to the at the end of June 2009. The public consultation Internet wirelessly via a high-speed (3G/HSPA) process regarding to the draft offer has been network. The share of cable network operator completed and approval procedure of the Turksat has also augmented from 1.3 % to 3.2 % reference offer is ongoing. Besides, some new during the last two years and fiber connections re-sale tariffs proposed by Turk Telekom have expanded their share from 1% to 1.8 % since been included in the existing offer upon early 2010 (Figure 2-6). approval by the Authority. In this context, ADSL 2 Mbit/s with 4 GB quota, ADSL 8 Turksat provides both satellite and cable Mbit/s unlimited, MEB ADSL 2 Mbit/s, 4 television services. It has around 1.2 million Mbit/s unlimited, ADSL up to 8 Mbit/s cable television subscribers.26 Turksat has unlimited, with 4 GB and 6 GB quota, ADSL upgraded its networks and made cable 512 Kbit/s with 512 MB quota and ADSL2+ 16 broadband services available to the majority of Mbit/s unlimited resale tariffs have been homes in urban areas. Nonetheless the cable approved in 2009 and included in Turk Telekom network is in its takeoff phase and needs an Reference xDSL Resale Offer. effective management model for further expansion. The Turksat “Uydunet� service Mobile broadband offers a competitive provides its subscribers with broadband Internet alternative to fixed broadband. Turkcell, Avea access through its cable infrastructure at speeds and Vodafone, the three operators in mobile segment had authorization from the government to provide 3G services as of December 2008, 26 http://www.turksat.com.tr/english/v2/cable-services 24 xDSL (TTNet) xDSL Other Cable (Turksat) Mobile Fiber Other Figure 2-6: Shares of technology in total broadband subscriptions, percent, 2010 Japan Korea Slovak Republic Sweden Norway Denmark OECD Czech Republic Hungary Iceland United States Portugal Netherlands Italy Poland Turkey Switzerland Finland Germany Ireland 0% 10% 20% 30% 40% 50% 60% Figure 2-7: Percentage of fibre connections in total broadband, June 2010 (Source: OECD) 25 ranging from 1 Mbps to 20 Mbps. One challenge is proposing to build its own network for for expanding cable broadband access is that exchanging data. most TV subscribers in Turkey have a The lack of a complete and strategic approach preference for satellite delivery (some 10 million would impair this great opportunity. There are satellite dishes in mid-June 2010).27 signs of a better understanding emerging in Fiber networks are ideal because the capacity is government circles. The National Broadband much higher than traditional copper lines and Vision has urgently called on the public and relatively easy to expand once the fiber is in private sectors for the development of a holistic place simply by adding additional lasers to a line. government approach to broadband. SPO is When compared to advanced Asian and getting ready to update the nation’s Information European economies Turkey lags in fiber Society Strategy and disclosed publicly that it broadband penetration (Figure 2-7). However shall prepare a separate chapter on broadband. A the recent expansion in fiber subscriptions is more organized approach should prepare for very promising and it indicates the demand for harder policy designs to broadband challenges high bandwidth network access could possibly and ensure competition in the national be ready in the country. During 2010, the share broadband market since it is the best option and of fiber subscriptions in the total broadband the main driver of continuous improvements. market reached 1.8 percent. The Turkish government should also ensure a In terms of technology deployment, though more effective regulative approach for there have been outstanding market broadening competition in the broadband developments that reflect the overall potential in market. The development of competition in demand and supply sides, the majority of broadband has been extremely slow, primarily Turkish broadband infrastructure is based on because the Ministry of Transport and the traditional forms of connectivity devices which Information and Telecommunication do not allow high bandwidth data services such Technologies Authority have been slow in as advanced e-health and multichannel adopting, implementing and enforcing the television. Turkey shifted from a dial up network necessary secondary legislation. Analysts argue structure to a broadband dominated one at a that Turk Telekom’s influence on the Ministry very rapid pace. Turkey’s fiber Internet and the Information and Telecommunication backbone provides for high-speed connections, Technologies Authority’s lack of full but this has not translated to a high number of independence from the Ministry are to a large broadband users. extent responsible for this state of affairs. In the long run the leading policy challenge for 2.3.3 Prices the government would be facilitating the Prices are a crucial indicator in evaluating the development of high speed broadband networks state of broadband development in any given most notably fiber. High-speed broadband has country. Analysis of prices, the level of service, strategic importance and should be promoted. and the range of choice available to users, can Much as traffic expands to fill roadway capacity help inform questions about the take-up and use after the building of superhighways, having more of broadband services as well as in assessing how broadband capacity will likely facilitate the competitive broadband access is in individual delivery of government e-services, provide a markets. While there is still not enough data to foundation for e-government in whole sectors of systematically examine price and performance government, and stimulate the development of changes, the trend in prices is very much e-business. Besides the recent rapid shift into downward; and the trend in performance is high bandwidth subscriptions and explosive upward. Competition is the main driver of growth in mobile and fiber segments indicate improvements in price and performance. that the future demand for broadband ecosystems will be strong. Turkish universities International comparison suggests that prices of have already developed their own broadband broadband services in Turkey are among the network, as has the National Adjudication highest in OECD and EU economic areas. The Network Project (UYAP). The e-health initiative average broadband monthly price per advertised Mbit/s in Turkey is about 40 percent higher than the OECD average. When prices are corrected for purchasing power parity, prices in Turkey are 27http://www.eutelsat.com/products/broadcast- the highest (). Turkey is also lagging behind in audience.html 26 high-speed connectivity prices. Prices in Turkey Mbps going from US$ 69 per month with are relatively cheaper for low speed connections unlimited data transfer and decreasing prices for and relatively more expensive for high-speed more limited speeds and data cap options. connections. Among independent ISPs offering broadband Presenting the latest situation as of March 2011, Internet services, Superonline provides DSL and Table 2-2 confirms that high prices and fiber Internet access with different speed affordability are among main concerns in options. The baseline starts with a 1 Mbps speed Turkish broadband market. Turk Telekom offers service at USD 28.7 with unlimited data transfer, DSL services with different speed options. The and 8 Mbps speed option goes from USD 24.7 baseline ADSL offer at 1 Mbps costs US$ 13.2 and USD 18.3 with 6 GB and 4 GB Cap per month with a 1 GB cap on data transfer. respectively. Among fiber connections the Higher speed services are much more expensive highest option is 100 Mbps costing USD 125.9 than EU countries. The highest speed 100 Mbps with unlimited data transfer. service is priced at US$ 94.3 per month with As the largest cable TV service provider, Turksat unlimited data option and a fiber 32 Mbps runs its Uydunet to offer broadband services at service costs US$ 27.2 per month with a 10 GB different speed options. The baseline is the Cap. Turk Telekom’s ADSL2+ 16 Mbps services 1 Mbps speed service costing USD 18.3 per are priced at US$ 37.3 and USD 20.9 with month with unlimited data transfer. However unlimited and 5 GB Cap respectively. Turk higher speed services are priced relatively higher Telekom also offers ADSL technology to than the average ADSL services. The 10 Mbps consumers with the highest speed option 8 option costs USD 62.6 and the 20 Mbps service Greece 27.72 Italy 29.91 United Kingdom 30.80 Ireland 31.33 Finland 32.46 Sweden 32.50 France 32.70 Switzerland 33.25 Japan 35.18 Korea 38.50 Average Subscription Price, Germany 38.87 USD, PPP Hungary 39.39 Belgium 39.75 Poland 39.85 Denmark 40.20 Iceland 40.63 Netherlands 41.01 Slovak Republic 46.85 Spain 48.34 United States 49.25 Austria 50.11 Czech Republic 51.64 Canada 54.24 Mexico 56.71 New Zealand 57.06 Australia 59.45 Norway 62.76 Portugal 79.53 Luxembourg 91.29 Turkey 135.36 0 20 40 60 80 100 120 140 160 Figure 2-2: Broadband average monthly subscription price, Oct. 2009, USD PPP (Source: OECD) 27 Price per month Price per month Price per Mbps Operator Technology Speed (Mbps) (TRY) (US$) (US$) Note TTNet (TTelekom) ADSL 1 20,9 13,2 13,2 1 GB Cap TTNet (TTelekom) ADSL <=8 29 18,3 2,3 4 GB Cap TTNet (TTelekom) ADSL <=8 32 20,2 2,5 6 GB Cap TTNet (TTelekom) ADSL 8 109 69,0 8,6 Unlimited TTNet (TTelekom) ADSL2+ <=16 33 20,9 1,3 5 GB Cap TTNet (TTelekom) ADSL2+ <=16 59 37,3 2,3 Unlimited TTNet (TTelekom) Fiber <=32 43 27,2 0,9 10 GB Cap TTNet (TTelekom) Fiber <=100 149 94,3 0,9 Unlimited Superonline ADSL 1 45,3 28,7 28,7 Unlimited Superonline ADSL <=8 29 18,3 2,3 4 GB Cap Superonline ADSL <=8 39 24,7 3,1 6 GB Cap Superonline Fiber <=50 59 37,3 0,7 12 GB Cap Superonline Fiber <=100 199 125,9 1,3 Unlimited Uydunet (Turksat) Cable 1 29 18,3 18,3 Unlimited Uydunet (Turksat) Cable <=10 99 62,6 6,3 Unlimited Uydunet (Turksat) Cable <=20 199 125,9 6,3 Unlimited Turkcell HSDPA 7,2 29 18,3 2,5 1 GB Cap Vodafone HSDPA 7,2 30 19,0 2,6 1 GB Cap Avea HSDPA 7,2 29 18,3 2,5 1 GB Cap Table 2-4: Prices of selected broadband service packages in Turkey, March 2011 (Direct source inquiry to author) costs USD 125.9 per month without any cap on price of the related service including VAT. data transfers. Prices per Mbps offered are Compared to the other communication services, significantly higher than ADSL operators. Internet services are taxed relatively lower: SPC rates on mobile and fixed line communication The three mobile operators, Turkcell, Vodafone services are 25% and 15% respectively. Though and Avea are also offering mobile Internet taxes on Internet services are relatively low the services based on HSDPA technology and there fiscal burden still accounts for a major impact on are quite differentiated service packages for a middle-income household. consumers. Table 2-4 presents a selection of these mobile packages most notably the baseline One can expect that when Internet access options. All three operators offer 1 GB cap requires a lower share of monthly per capita mobile data options at around USD 18-19 as of income, usage rates increase, everything else March 2011. being equal. Internet access cost – measured as the Internet subscription cost as share of average Since the competition in fixed broadband market monthly income – relatively high. According to has been relatively limited in Turkey, the general analysts, middle-income consumers are generally downward trend in prices seems to be somewhat ready for broadband packages costing less than 3 partial. The effect of taxes on broadband service % of their per capita income.28 In Turkey the pricing is another significant variable in assessing Internet access cost of an average broadband the affordability and performance of the market. package has come down significantly in recent As part of the need to augment the tax base years but still exceeds 3% threshold with a rate during the economic crises of 2000-2001, Turkey around 5%. raised taxes on telecommunication services. While these measures have increased tax National growth performance has created revenues, they had a negative effect on e-services opportunities for broadband expansion and take-up. In 2008 the government considered service affordability. The high growth in per ways to increase the affordability and thereby the capita income in recent years affected positively use of e-services by reassessing the broadband affordability by increasing the telecommunication taxes but little has been denominator. It is clear that rising incomes have achieved. supported the market and affordability of The tax rate applied for broadband products and services include the 18% Value Added Tax (VAT) and an additional 5% Special 28Source: Interview with Ahmet Hasanbeseoglu from Communication Tax (SCT) calculated over the Cisco. 28 broadband services in a country where promote faster and more affordable Internet competition was somewhat imperfect. access in line with EU initiatives in this area. Internet use will likely increase significantly if the Mobile phones can provide an alternative, less cost of accessing the Internet can be reduced. expensive channel for delivery of e-services to The government should prompt action to reduce citizens and businesses. Given the high number taxes on both telecommunication and of mobile subscribers in Turkey, the government broadband services. On the supply side the should consider this channel to provide Information and Communication Technologies information and services. In this regard a simple, Authority should continue to actively stimulate flat and more affordable tax rate applied to competition in the telecommunications sector to communication services could be a good and less distortive option. 29 3 Applications Government policies should ensure not only projects have been enablers of e-government development of broadband infrastructure but and e-transformation in the Turkish public also have to ensure that broadband technologies sector. Many of the projects are high volume and are adopted and used increasingly by the high value ones with important transactions on a country’s businesses, households and public daily basis such as MERNIS and UYAP. Turkey sector. The previous sections of the report focus has also demonstrated good progress in terms of on penetration, price, and speed of high electronic tax returns. The Internet Tax Office bandwidth Internet networks in Turkey and has become operational and started to accept highlight how the country tried to promote declarations and payments online. The Custom competition and encourage investment in order Modernization Project, one of the long waited to increase connectivity. This part presents the initiatives, finally completed in this period and content and applications created by private, civil became effective in 2009. E-government and public agents over broadband platforms. applications also include some public portals to provide up to date information to targeted 3.1 Government audiences or to the broader public. The Turkish The period of 2000-2010 can also be called the Foreign Investment Portal, KOBINET and era of e-government in Turkey. The negotiation Tourism Portal are examples in this regard. process with the EU and the rule of a single In the last ten years Turkey has made strong party government helped public agencies to progress to develop e-government applications design and manage more concerted efforts on e- and infrastructure. Some main findings and government applications and infrastructure. policy lessons could be drawn from this Since then Turkey has made strong progress in transformation process to inform similar implementing e-government. The number of countries: services integrated with the e-Government gateway reached 139 (6 fold increase in one year)  Strong political leadership: One of the and the number of visitors increased over half reasons for the rapid development of e- million people (50 fold augmentation in one government in Turkey is its strong year) in 2010. While the central government support within the high-level political allocated US$ 267 million for 203 e-government leadership. E-government leadership is projects in 2002, the public investment budget provided by the e-Transformation rose to US$ 590 million for 244 projects in the Turkey Executive Board, chaired by the pipeline in 2010. The number of web sites to Deputy Prime Minister. The new provide access for public services grew government’s modernization agenda explosively during this period and as of 2010 the considers e-government as a major tool total number was above 20 thousand (Figure for change. 3-1).  Effective organizational management: The share of services provided through In terms of planning, financing and electronic channels in total public services monitoring functions The Executive reached 66% and the e-services user satisfaction Board is aided by the State Planning rate was recorded as 95% in 2009. In a Organisation (SPO), which is benchmarking study conducted by the EU in responsible for scrutinizing all public 200729, the maturity level of 20 basic public investments. From a broader services in Turkey scored very much near the perspective the SPO has provided EU average and even overtaking slightly the EU necessary technical and organizational score in the business services segment (Figure services to develop, implement and 3-2). monitor a coherent strategy for e- transformation in the public sector Table 3-1 presents leading e-government organizations. applications implemented in Turkey. These  A strategic approach to e-government: Together with line ministries and private 29European Commission. 2007. The User Challenge sector agencies these organizations Benchmarking The Supply Of Online Public Services. http://ec.europa.eu/information_society/eeurope/i2010/d ocs/benchmarking/egov_benchmark_2007.pdf 30 25.000 gov.tr Other Public Inst. Total Public 20.000 15.000 10.000 5.000 0 2003 2004 2005 2006 2007 2008 2009 2010 Figure 3-1: Number of public sector owned websites 20 Services 12 services for citizens 8 services for business 100 90 80 70 60 50 40 30 20 10 0 Turkey EU27 Figure 3-2: The maturity level of selected public services, percent, 2007 (Source: European Commission 2007. The Use Challenge Benchmarking The Supply Of Online Public Services) 31 Project Explanation Web pages Launched in December 2008, one stop shop, integrated, multi-channel (internet, mobile, call center) service delivery E-Government Gateway platform for identification and payments. Mobile portal launched in October 2009 currently 139 public services are www.turkiye.gov.tr integrated. Central Census Management System (MERNIS) Unique ID number for all citizens (over 130 million records www.nvi.gov.tr ID data sharing platform through web services. More than 2,500 agencies, both public and private, signed 19 protocols to Identity Sharing System (ISS) use the system. PM Circular dictates public agencies do not require citizens to submit ID records and address information and obliges them to acquire this information through ISS. www.nvi.gov.tr Address Record System Citizens address records are integrated with MERNIS through ID numbers. www.nvi.gov.tr Aims to ensure fast, reliable and robust judicial system. Comprises all of the courts, public prosecutors, prisons, other judicial institutions and other government departments. Serves to some 40,000 officials and judges, 66,000 lawyers and for National Judiciary Informatics System (UYAP) all citizens. Litigate online case, reach and examine case information. Informs citizens on their cases through SMS. Ministry of Justice announces 2.7 billion € savings with applications of UYAP. www.uyap.gov.tr Online tax declarations and payments. Online payment of motor vehicle taxes and traffic fines. 99 % of tax returns are Internet Tax Office declared online. OECD study shows unit cost of tax revenue collection decreased from 2 $ to 0.35 $. www.gib.gov.tr Covers 684 locations. Internal applications (26 main applications, 51 search programs and 26 local applications) and some Police Network and Information System (POLNET) online applications: passport application, driving license (application and information on penalty points), denounce on public order and security, search for lost persons. www.egm.gov.tr TUBIDER IT Sector Association was founded in November in 1999 so as to protect rights and interests of the IT companies Informatics Sector Association operating in the informatics sector and to ensure vocational regulations are implemented. TUBIDER continues its operations having reached to 800 registered members and more than 1500 applicants. www.tubider.org.tr Network for communication and data transfer for over 6,000 users in 1,660 auditing branches and 39,500 Accounting Office Automation Project (Say2000i) budget offices throughout the country. All financial transactions are processed online and monitored real-time. www.muhasebat.gov.tr Facilitates legal trade and prevents illegal trade by using ICT. Customs formalities are carried out in a computerized media in Customs Modernization Project real-time. 100% of customs transactions are processed electronically. Around 6.3 million import and export declarations were processed by using this system in 2009. www.gumruk.gov.tr Social security premiums of employees are declared online. People pay the premiums electronically, verify payments made Social Security e-Declaration Project and outstanding balance. More than 90% of firms process declarations online. www.sgk.gov.tr Guide for foreign investors on: starting a business, cost of doing business, taxes and incentives, special investment zones, demography and labor force, business environment and business legislation, infrastructure, economic outlook, Investment Turkish Foreign Investment Portal Support and Promotion Agency assists investors in Arabic, Chinese, English, French, German, Italian, Japanese, Korean, Russian, or Spanish as well as Turkish. www.invest.gov.tr Provides information about business environment (marketing, management, taxes, human resources, internet and KOBINET for SMEs technology, finance, insurance and labor regulations). Information about firms, online business opportunities, 22,915 members. Provides user ID, password, e-mail address, web pages in 7 languages as free of charge. www.kobinet.org.tr Tourism Portal Provides information on history, heritage, life-culture, travel guide, where to go and business. www.goturkey.com Electronic Signature Law is effective since 2004. Electronic signature has the same legal effect as that of a Electronic Signature and Certification Authority handwritten signature. Public Certification Authority (PCA) for public agencies. 3 private electronic certificate service providers www.kamusm.gov.tr Mobile Electronic Signature Introduced by a Turkish GSM operator. Initial applications in banking, customs, justice and some local administrations. www.btk.gov.tr Table 3-1: Major e-government applications in Turkey (Source: Author’s compilation) 32 managed to develop a shared vision and Technologies Surveys carried out by a focused strategy including quantitative TURKSTAT provides information regarding targets for outputs and outcomes in access to and use of online public services by order to make e-government happen. citizens and enterprises. According to these results, enterprises use public web pages more  Prioritizing projects: Instead of creating than the household sector. As of 2008 while many e-government services Turkey 68% of the surveyed enterprises responded that with a clear focus, has managed to they use public web pages to get information prioritize projects that have high volume only 26% of households replied the same and high transactions: e-procurement, question positively. During their visit to the making social security and health public web pages, 91% of households spent time payments, and collecting customs, tax by getting information, 30% by downloading and social security payments etc. This forms and 34% sending information and selective list also included projects to uploading forms in 2009. With a 92% response establish e-government infrastructure share, getting information is among the leading and ICT network platforms to enable motivation for enterprises visiting public sector provision of e-services. web portals. 83% of enterprises get involved in On the supply side the main challenge for downloading forms whereas 70% responded Turkey now seems to be improving Internet positively that they filled and sent some forms access and broadband development. Turkey’s through web sites. More interestingly 7% of basic communications infrastructure is the enterprises submitted proposals for public telephone line network and the country clearly tenders via public web portals. needs alternative technologies such as fiber Individuals who do not visit public web pages networks for next generation broadband responded that the preference to carry out services. Internet access costs remain high transactions face to face in public offices seems causing the penetration rates to go flat. Public to be the chief reason for not using e- policy should assume a more pronounced role in government services. 19% of the group replied terms of ensuring broadband infrastructure the unavailability of online services has development. prevented them to use public web sites Another supply side challenge is increasing the frequently. Likewise 74% of the enterprises not capacity of line ministries and local governments preferring to use public web sites state the major to develop and implement e-government within reason for this behavior to be the preference to their respective sectors and in their subordinate meet face to face. 44.2% give the reason as the agencies. A strong case is needed to make for unavailability of the required services online co-operating rather than developing solutions in whereas another 36.1% report delays of isolation. As e-government applications feedback. Surveys indicate that enterprises need proliferate and the number of projects in the more sophisticated services and the demand for pipeline augment Turkey needs to transform its e-government services becomes more developed centralized organizational setup in e-government in the case of business transactions with the to a more horizontal and participative one. public. An early study conducted by OECD (2001)30 Another interesting finding is that a great defined lack of ICT skills as a hidden threat to e- majority of households and enterprises which do government and e-transformation. Turkey’s e- not prefer to use e-government applications government infrastructure and applications are report that they are motivated to meet face to relatively more advanced than her ICT skill base face rather than making transactions online. This in public offices. To transform the government may be regarded as an indication of a cultural by means of e-government Turkey should focus impact on the e-government applications since on building appropriate skills and ensure people Turkish people are generally known to be are willing to work in the public sector. socializers. However since broadband technologies have also transformed the social On the demand side, the results of the space and socialization process itself, the Turkish Household and Enterprise Use of Information society seems to be in a period of continuing adoption to ICTs and e-government applications. OECD (2001) The Hidden Threat to E-Government, 30 Avoiding large government IT failures, PUMA Policy Brief No. 8. 33 100 90 84.8 80 76.7 70 58.7 60 55.2 50 40 30 20 10 0 10+ 10-49 50-249 250+ Figure 3-3: Ownership of web sites, by employment size of enterprises, 2009 (Source: State Planning Organization Information Society Statistics, 2010) 30 28,8 Placing order 25 Receiving Order 21,6 19,7 20 18,6 16,4 17,4 percent 15 13,0 11,7 10,1 10,1 10,4 10,1 10 4,7 3,8 5 0 Motion picture and Real estate, renting Transport, storage Hotels, motels, Wholesale and Construction Manufacturing video activities, and business and communication camping sites retail trade, repair Industry radio and television services of motor vehicles, motorcycles and personel and household goods Figure 3-4 E-commerce activities of enterprises by sector of activity, 2007 Hence the chief policy challenge on the demand side is to provide and maintain good skill 3.2 Electronic commerce creation mechanisms and programs for increased The abilities of enterprises to acquire, generate, ICT adoption by households and enterprises. and manage knowledge have become a main Education policy should play a significant role driver of economic growth. To do this, the through formal education and lifelong learning adoption of ICT by business and its widespread programs. and efficient use in enterprises has crucial importance. Electronic commerce (e-commerce) 34 percent 80,0 70,0 60,0 50,0 40,0 30,0 20,0 10,0 0,0 Other Increased turnover Lower transaction Penetration into new costs markets, increased sales potential Figure 3-5: The benefits reported through e-commerce, 2008 applications have been at forefront of this economic sector to adopt e-commerce has been transformation process. tourism services. 21.6 % of hotels, motels and camping sites reported to place orders while 28.8 Within the group of enterprises employing 250 % of the same group reported to receive orders or more employees, 85% have established their via internet. Real estate, motion picture and own web sites in 2009 (Figure 3-3). In the group video activities, wholesale and retail trade and of enterprises with 50-249 employees, web site transport and communication sectors are among ownership ratio decreases to 76 % and in the leading sectors in terms of enhanced e- group of 10-49 employees size, it further commerce applications. More industry oriented declines to 55%. The adoption of e-commerce is activities such as construction and positively correlated to financial and managerial manufacturing, by contrast reported somewhat capacity of business units and Turkish poorer adoption rates of e-commerce than enterprises have a growing interest in electronic service based sectors. commerce. Banking and financial sector is an interesting According to survey data by TURKSTAT, 77.9 example where e-commerce systems have been % of enterprises have provided product catalogs developed and embedded into business models and price lists through web sites. It is the leading rapidly. Sayar and Wolfe (2007) found that form of e-commerce activity exercised by Turkish banks offer a wider range of services enterprises. In 2008 44.8 % of enterprises from their internet branches compared to British reported to engage in marketing of their banks, despite the fact that the UK has a more products and services through internet and 28.4 favorable environment for internet banking in % responded of giving after sales support terms of the level of sophistication of its banking services. The share of enterprises conducting sector and technological infrastructure.31 online purchase order, reservation and registration transactions is 16.3 % as of 2008. As While in most of the service-based industries the e-commerce activities get more sophisticated main motivation is to augment sales and ability of adoption by enterprises is observed to increased market penetration, in the Turkish decrease significantly (Figure 3-4). banking sector the main incentive is lower costs rather than increased sales. Analysts calculate E-commerce growth and adoption among Turkish enterprises is uneven and subject to significant variation among different sectors of 31Ceren Sayar, Simon Wolfe, (2007) "Internet banking economic activity (Figure 3-4). The leading market performance: Turkey versus the UK", International Journal of Bank Marketing, Vol. 25 Iss: 3, pp.122 - 141 35 that an Internet transaction costs a Turkish bank  Having employed information around 5% of the cost of the same transaction in specialists (48.6% of the group with 250 a traditional bank branch.32 Most of the larger and more employees reported to employ commercial banks in Turkey offer Internet- information specialists) or even creating based banking services. Other companies offer their own divisions for this purpose. online services. The most active are airlines and retailers of books and electrical goods, largest E-commerce is growing rapidly in both demand supermarket chains also offer online services. and supply sides. However the degree of adoption differs among enterprises significantly The data on benefits reported through e- and the size of firms plays a major role in commerce activities can also provide a good enhancing e-commerce applications. Larger example in terms of assessing the relative degree firms with expanded financial and managerial of e-commerce adoption by Turkish enterprises capacity are in favorable condition to develop e- (Figure 3-5). A great majority (70 %) of surveyed commerce solutions and online services. Smaller firms have responded that penetration into new enterprises with fewer resources are finding markets and increased sales potential were the difficult to get involved in these next generation foremost benefits after engaging in e-commerce commerce activities. activities. Lower transaction costs and increased turnover with a 60 % response share each are Government policies should address more rapid among positive effects perceived by these firms. and balanced development of e-commerce This clearly shows that enterprises are getting applications in the enterprises sector. KOSGEB, aware of the benefits offered by e-commerce the agency in charge of assisting small and applications. medium-sized enterprises (SMEs), should increase its efforts and design additional There are also a number of challenges that limit programs to address this challenge. In the past increased adoption of e-commerce. According to KOSGEB established 55 Internet cafes with the Survey data in 2008 enterprises reported to instructors to assist SMEs in using the Internet. face following problems: Customers reluctance But this is not sufficient; much more could be to use e-commerce applications (56.4 %), accomplished by, for example, working with difficulty to adopt products and services into universities to provide courses in using the internet based commerce systems (55%), security Internet, as well as providing counseling and issues during payment (48%), uncertainties in training services in e-commerce to SMEs. legal infrastructure of e-commerce (45.5%), technical issues and problems (42.4%), 3.3 Other Applications: The Rise of difficulties to reorganize business models Social Media (42.2%), and negative experiences on electronic The development of social media has been rapid sales (14.2%). in Turkey. While the country is lagging behind in In other parts of the Survey, enterprises gave terms of broadband penetration than more increased attention on security issues related to advanced economies, Turkey’s youthful e-commerce applications. More than 17 % population structure makes it a very vibrant reported to experience some security problems market for most social media applications and during their electronic activities in Internet. services. In Turkey, where 70 percent of the There are also some indications that the share of population is under 35, online communications enterprises having some problem on security is very appealing to young people. issues is on the rise. Enterprises started to With more than 26 million users, Turkey is one introduce necessary measures to overcome these of the 15 largest Internet populations in the challenges on two fronts: world and roughly the size of the Spanish, Italian  Having installed secure servers (94.9% or Canadian markets. Turkey’s mobile of the group reported to have at least penetration is larger than Internet penetration, one server) and software (37.9 % which means that people increasingly access reported to have installed firewalls). social network applications from mobile phones. 32Source: Economist Intelligence Unit, news at http://www.ebusinessforum.com/index.asp?layout=rich_st ory&doc_id=11173&title=Turkey%3A+Overview+of+e- commerce&channelid=4&categoryid=31 36 Table 3-2: Top cities on Facebook (Source: Socialbakers.com) commerce, business networking, social Turkey has the fourth highest Facebook networking, social bookmarking, blogging and population in the world.33 According to one micro blogging, customer tracking, etc.). The source, Istanbul has been ranked as the city with figure demonstrates that social media are the second largest number of Facebook accounts increasingly popular in society and Turkish in the world with over 9.6 million people. content creation is at its emerging stage except Following Facebook, the most popular social for news services where there is a natural networking services are Mynet Eksenim, Netlog tendency to utilize the mother language. In the and MySpace.34 Twitter and personal blogs have electronic commerce services segment the also gained in popularity. leading companies are domestic with uniquely Turkey’s own social media content is growing designed and developed web applications. day by day. According to a recent study conducted by a consulting firm, Turkish web Istanbul recently hosted the World Social Media sites are getting popular and increasingly Forum providing a meeting place for sharing diversified. Figure 3- presents a snapshot of the global experiences and knowledge in this social media landscape in Turkey categorized regard.35 Turkish experience with social media around different activities (e.g., photo, video, applications presents a useful example for other document and music sharing, news services, e- countries with similar economic and cultural backgrounds. 33 http://www.ictdata.org/2011/03/monaco-tops-in- facebook-penetration.html 34 comScore, Inc. 2009. “Instant Messaging Accounts for More Than 25 Percent of Total Time Spent Online in Turkey, Followed by Social Networking at 10 Percent�, July 16. http://www.comscore.com/Press_Events/ Press_Releases/2009/7/Turkey_Instant_Messaging_and_S 35http://www.worldsocialforum.info/news/european- ocial_Networking social-forum-turkey-make-them-pay-for-their-crisis 37 Figure 3-6: The Turkish social media landscape, 2010 2 (Source: Ticktock Boom at www.ttboom.com/index.html) 38 4 Usage and Diffusion Since the Internet can be viewed as a public between urban and rural areas, men and women, good necessary for economic and social young people and individuals aged 55-74, and development, governments should take part in individuals with higher education and people fostering nationwide internet access. A without higher education. In 2009 urban areas competitive private sector needs to develop the have 32.5% broadband household penetration capability to use e-commerce. E-commerce will whereas rural areas have only 11%. However it is develop slowly if there are few Internet users, observed that the rural broadband connections and users will not develop if charges for are growing at a superior rate than that of urban connections are high, coverage low, and the areas which means the digital divide is getting Internet provides negligible content and services. smaller (another factor is because of the This section draws analysis on Internet usage restrained growth of broadband infrastructure and diffusion by people and enterprises. nationwide and particularly in largely populated Discussion herein progresses around issues of urban centers). how individuals and enterprises in Turkey use The Internet usage proportion is the highest in the Internet and differences in usage as to the 16 – 24 age group (59.4 %) according to the gender, age, and where people live – the so- results of the survey applied to the 16 – 74 age called digital divide. groups. The usage of Internet by women (46%) significantly lags behind the usage of men 4.1 People (74.1%) in 16 – 24 age group and all age groups. Household broadband access is relatively low in Consequently, it is important for the Turkey compared to European Union members. government to seek to increase the proportion In 2010 more than three out of five households of individuals using the Internet through better living in EU countries had a broadband geographical coverage and by reducing the cost connection while in Turkey the ratio was 34% of accessing and using the internet. (Figure 4-1). This relatively low share of broadband access represents a barrier to the The level of education and Internet usage are take-up of online government services as well as highly correlated. Internet usage of individuals the development of e-commerce. increases in parallel with their education levels. Internet usage by women with college, Significant differences exist within Turkey: 60 50 EU (27) Turkey 40 30 20 10 0 2004 2005 2007 2008 2009 Figure 4-1: Household broadband penetration, as percent (Source: EUROSTAT) 39 80,0 percent 70,0 60,0 Female Male 50,0 40,0 30,0 20,0 10,0 0,0 Other During social Internet cafes Education or Workplace Home events or visits training institutions Figure 4-2: Internet usage by place of connection, male and female, 2009 university, and higher education (85.8%) is quite Survey data indicate basic Internet activities such close to the usage levels of men with the same as sending email (73%), reading online news educational background (89%). Those using the (59%), surfing the web and making social Internet most, according to employment status, connections (64%) are among the leading forms are students (88.2%), employers (66.1%), of Internet usage. Usage rates for more waged/salaried employees (56.8%), and the sophisticated Internet activities are still relatively unemployed (41.6%). 36 low: Internet banking (17%), looking for a job (10%), online education (6%) and selling goods A great majority of users (68.2 % for females or services (4%). and 51.6 % for males) report using the Internet at home. The proportion of home usage by Analyses show that Turkey faces a number of females is significantly surpassing the usage by challenges in Internet usage. First and foremost males. The workplace usage is among the top improving Internet access and broadband forms of Internet connection activities among development should be a priority on the supply households and more interestingly Internet cafes side. Turkey needs to promote a high degree of continue to offer a wide mean for internet in broadband coverage using appropriate particular for male groups (31.8%). Individuals technologies. Initiatives to reduce the digital also report that they are using internet during divide in Turkey should also include expanding social activities and visits. (Figure 4-2). the number of computers and computer classes in primary and secondary schools, and providing Though home access have greatly increased increased access to the Internet through recently Turkish people still account for a community use of school computers. Turkey has different structure of access type by place. demonstrated an ambitious case in trying to Internet cafe use is much higher and public close the divide in digital literacy between urban libraries are not used at all. This finding shows and rural areas by means of education policy. that Internet access from home or workplace is The Ministry of National Education (MNE) and not always the most revealing measures of actual local governments have taken part in this individual internet access for comparison collective effort to foster education in digital between countries. skills. The number of students per computer is 30.8 in primary schools and 25.1 in secondary schools nationwide. 27,999 information 36The data come from the Survey results by TURKSAT technology (IT) laboratories were established. and figures are for 2009. 40 Turkey Urban Rural Sending/receiving e-mails 72.8 73.9 66.9 Posting messages to chat sites, blogs, news groups or 64.2 65.0 60.4 online discussion forum, use of instant messaging Reading or downloading online news/ 58.8 58.8 58.9 newspapers/news magazines Finding information about goods or services 55.7 57.7 45.6 Playing or downloading games, images, films or music 51.2 51.1 51.5 Seeking health-related information (e.g. injury, 47.3 48.6 40.8 disease, nutrition, etc.) Telephoning over the Internet/ video calls (via web 47.1 48.3 41.0 cam) over the Internet Listening the web radios or watching web television 41.1 42.1 36.1 Consulting the Internet with the purpose of learning 37.1 38.1 32.1 Uploading self-created content (text, images, photos, 30.3 31.3 25.1 videos, music, etc.) to any websites to be shared Looking for information about education, training or 26.4 27.0 23.5 course offers Using services related to travel and accommodation 22.6 24.9 11.1 Internet banking 16.8 17.8 11.3 Downloading software (other than games software) 14.8 15.6 10.5 Looking for a job or sending a job application 10.2 10.5 8.9 Doing an online course (in any subject) 6.3 6.7 4.5 Selling of goods or services, e.g. via auctions 4.1 4.3 3.1 Table 4-1: Internet activities of individuals who have accessed the Internet in the last 3 months, by private purposes, %, 2010 (Source: TURKSTAT, Results of the ICT Usage in Households and by individuals, 2010) 1,850 Public Internet Access Points (PIAP), to provide ICT access and ICT competency to 4.2 Business citizens, have been completed by the MNE. The business sector has shown somewhat more success in ICT adoption than households. The Since the early take up of information society Turkish business sector has become heavily and e-transformation initiatives Turkey has computerized in the last ten years. Computer launched a motivated program for teaching usage has become a standard nationwide even in computer and information literacy in primary micro sized business units. In 2009 computer and secondary schools, but more is needed. penetration rates are as follows: In enterprises Turkey should provide means to increase with 250 or more employees 99.3%, in computer and information literacy for people enterprises with 50-249 employees 97.7%, in who are not in school. Online distance learning enterprises 10-49 employees 89.5% and in programs and new incentives and programs for enterprises with 10 or more employees 90.7%. Internet cafes to provide a social training base for households living in rural areas may Similarly Internet access by the business sector constitute the essence of an effective policy mix. has grown explosively and reached a level almost The government should also find means to identical to that of computer penetration rates. further motivate citizens to use the Internet by In January 2010, 90.9% of enterprises with at demonstrating and informing citizens about the least 10 persons employed used the Internet. benefits and advantages of accessing information This rate was 98.4% of enterprises with 250 or and government services online. more employees, while enterprises with 50-249 employees was 96.9% and enterprises with 10-49 41 Turkey EU 27 90,0 80,0 70,0 60,0 50,0 40,0 30,0 20,0 10,0 0,0 2007 2008 2009 Figure 4-3. Broadband usage indicators by enterprises, as percent employees was 89.7%. 88.8% of enterprises had to have access via traditional dial up connections Internet access in January 2009. also. Mobile technologies accounted for 13.5 % and cable technology had a proportion of 10.2%. The business sector has demonstrated a major achievement in adopting and utilizing ICTs and Figure 4-4. portrays how firms are integrating broadband. Turkish enterprises have high rate of internet usage into internal business process. broadband usage and as compared to EU 27 Two points can be drawn from data: The trends countries Turkey slightly surpasses the EU are similar between years and a major change is averages (Figure 4-3). In terms of connection not observed. Secondly, business units are type the most frequently used access technology utilizing online connections most for getting in enterprises was DSL with a 94.6% proportion financial services (76.3%) and assessing relevant in 2009. However 19.5% of enterprises reported market trends (78%). Diffusion of internet based Financial services Education and training Market trends as percent 77,5 75,9 77,6 77,0 76,3 78,0 32,6 33,4 31,6 2007 2008 2009 Figure 4-4: Internet usage in enterprises by purpose, 2007-2009 42 applications into education and training services However, this has not resulted in a fully accounts for lower but still a significant competent business sector with a high level of proportion (31.6%) in 2009. broadband usage and applications within integral business processes. A large share of small and Lack of sufficient number of candidates with the medium-sized enterprises (SMEs) selling in local required qualifications and job experience markets with few resources find it difficult to (39.4%) stood out as the main difficulty faced by learn and develop new marketing channels. enterprises when employing information These business units are slow to adapt specialists in 2007. While 68.3% of enterprises broadband technologies. Industrial structure is reported that the salary expectation of specialists increasingly fragmented and innovative were high, a greater proportion of 74.4% stated collaboration frameworks and programs are that the work experience and competency of needed. This is where the public policy should specialists as being insufficient. Similarly even a engage in effective mechanisms and incentive greater proportion of 84.5% reported there was structures to enable a favorable environment for very limited number of candidates with required technological take up. qualifications in 2007. 37 According to the Survey, enterprises, with a proportion of 8.9 % Given that broadband technologies have a very in 2007, had started to run internal training strong stimulus for economic growth, the programs to address the skill gap in ICT government might consider means to stimulate technologies. business usage through infrastructure development, as well as providing content and e- Though the broadband penetration has been services over the Internet through various somewhat limited compared to more advanced mechanisms. Requiring firms to interact countries, Turkish businesses have adopted a electronically with e-government services should high level of Internet usage, motivated to a large increase private sector use of the Internet. degree by the desire to use government e- Additionally, increased broadband availability services and penetration into new markets. One will allow faster development of Internet usage exception to this fact is the banking sector where and serve as an important factor in attracting the main motivation is cutting costs rather than foreign domestic investment in the Turkish demand aggregation. economy. Stronger efforts to foster human resource development and to address the ICT skill gap are needed also. Source: SPO (2010), Information Society Statistics, 37 Ankara. 43 5 Conclusions USD 1,652 billion rather than USD 1,216 billion 5.1 The Likely Impacts of High of the baseline scenario. This is a GDP level Bandwidth Networks on the 36% greater than the baseline. It may accurately Turkish Economy be called the broadband effect. According to the National Broadband Vision The broadband effect encompasses two Study of Turkey,38 through fostering broadband distinctive categories: Industry benefits development the Turkish economy could gain (measured as USD 289 billion during 2010-2023) US$ 4.9-10 billion extra value added each year comprising of the overall broadband thereby boosting its economic growth by 0.8-1.7 productivity impacts within and beyond the ICT percentage points. This economic momentum industry; and pillar effects (measured as USD enabled by an enhanced broadband ecosystem 147 billion during 2010-2023) which might would bring 180,000-380,000 new jobs and directly be associated with broadband enhancing provide new income opportunities. This implies policies of the government. Since industry that employment creation in new broadband- benefits are nearly two times larger than pillar related activities would eventually compensate benefits for Turkish economy, broadband for job loss due to process optimization and enhancing policies should trigger a multiplier structural displacements. effect within the economy and their indirect Through help of a toolkit39 the Broadband impacts could potentially outpace the direct National Vision Study reports to find a effects. significant growth impact for the Turkish The study also analyzes detailed impacts of economy fueled by broadband enhancing public enhanced broadband polices on different policies. In the baseline growth scenario Turkish economic sectors, the so called pillar effects. economy would take off by an annual rate of 5.0 Pillar effects can be decomposed into different per cent as depicted in Figure 5-1, and it would sectors as follows: reach the US$ 1,216 billion GDP level by the end of 2023. - 7 per cent of total pillar effects will come from revitalized small/medium business; Under the broadband enhancing growth scenario in which a set of active government - 6 per cent contribution will arrive from programs to boost broadband impact are improved government services; introduced, the economic growth forecast is - 4 per cent to come from the benefits of much faster, with an additional 2.3 percentage broadband-enabled education; points, reaching to 7.3% on annual basis. Government policies targeting enhanced 16 per cent to come from a more attractive broadband infrastructure and ecosystem will business environment; boost economic growth significantly. By 2023 - 67 per cent to come from other sectors, as the Turkish economy would have a GDP at well as multi-factor productivity and the benefits of collaboration across the 38 Turkish Prime Minister’s Office (2011), From Silk Road economy. to Broadband: Enabling Economic Growth and Competitiveness, Ankara. 39 Broadband Dynamic Value Assessment (BDVA) is a Analyses indicate forecast benefits from toolkit that fills a niche between the macroeconomic increased ICT adoption by the SME sector models that link broadband to aggregate economic growth will be large and e-government applications and models that take a wholly microeconomic approach, would provide a significant amount of measuring specific benefits of broadband by sector or type contribution through cutting costs and of usage. The BDVA focuses on broadband implementation objectives of public policy that link improving productivity. Another important broadband penetration rates to “pillars�, which in turn, policy area that should be focused is drive GDP growth. The pillars are essentially proxies for education. The main benefit seems to be broadband implementation objectives. In this manner, the improvements in the general business model user can identify which of these pillars have the greatest impact on GDP growth and use this information to formulate a national policy mix for achieving the greatest benefits from wider broadband usage 44 250 225 7,3 % Base Line 200 Broadband Enhanced 175 5,0 % 150 125 100 75 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Figure 5-1: Base line and broadband enhanced growth scenarios, Real GDP2009=100 ( environment. Under the broadband enhanced power in 2002, political leaders saw e- scenario policies to foster the business government as a central instrument that would environment, 16 % of total pillar effects will support public reforms and larger changes in the come from improvements in the business political system. A central organizational framework alone. The largest one is the structure was formulated to develop strategies multiplier effect. Broadband adoption will bring and put public money into the pipeline for a set benefits diffusing beyond the ICT sector of strategically important projects with high through channels of multifactor productivity. value and a high transaction volume. The EU candidacy of Turkey and the 5.2 Factors Contributing to Turkey’s membership negotiation process has provided a Broadband Development good opportunity for the country to reform its E-government initiatives have been a major ICT and broadband legal and regulative driving force for development of the broadband frameworks. This process helped bureaucrats ecosystem. Turkey has implemented a highly and top-level managers get closer to European motivated e government program that created institutions, policies and initiatives, and market the necessary demand for enterprises in the ICT developments in these sectors. sector and motivated citizens for increased Internet usage. In this regard Turkey has The high tempo growth of Turkish economy in demonstrated an interesting example that the last decade is another factor supporting in countries with relatively lower level of Internet the Internet revolution. The new national penetration and usage ratios can exploit e- government has implemented ambitious market government programs as a means to ignite oriented reforms complemented with a proactive development of the broadband ecosystem. foreign policy which resulted in large sums of overseas capital flowing into the country. Ensuring a shared vision among political leaders Communications, software and hardware and technocrats has also been an important segments of ICT industries have expanded factor in pushing e-government programs. Since rapidly. the coming of the new national government into 5.2.1 Lessons learned 45 Turkey Consumer (Infrastructure) Best Performing Country 1 0,8 Government 0,6 Consumer (Usage&Skills) 0,4 (Usage&Skills) 0,2 0 Government Business (Infrastructure) (Infrastructure) Business (Usage&Skills) Figure 5-2: Turkey connectivity performance by scorecard component, 2010 (Source: www.connectivityscorecard.org/countries/turkey) The Connectivity Scorecard is a composite index skills, where its score is considerably lower than to assess the relative development level of ICTs one might expect given the state of its business (Figure 5-2).40 Turkey was found to have a infrastructure. Turkey has made considerable robust consumer infrastructure due to its high progress in developing a robust ICT mobile and PSTN penetration and also the infrastructure but its weaker usage and skills recent progress in broadband networks. It also scores indicate that the country is yet to fully scores strong on consumer usage and skills realize its benefits. Therefore, it needs to place metrics such as frequent Internet usage and greater effort on ensuring the adoption and uptake of voice services. According to the diffusion of ICTs to leverage competitive power. Scorecard the country’s business infrastructure is Turkey faces a strategic opportunity in terms of above average, with high penetration of secure broadband infrastructure development. The Internet servers, and substantial business majority of the national broadband network is investments in ICT. Turkey also impresses on based on slower speed connections which do government-related metrics such as government not optimally support advanced applications of spending on ICT and provision of government next generation connectivity such as e-education, services online. e-health, etc. There are signals suggesting the However the Scorecard points out that Turkey current broadband network has become ranks somewhat poorly in business usage and somewhat overloaded. To enhance a rapid take up of high bandwidth 40 The Connectivity Scorecard is the first index to examine broadband networks the government should the quality and quantity of ICT usage and infrastructure and play a more effective and active role. First and to link it to a country’s social and economic prosperity. 25 foremost is ensuring effective regulation. The ‘Resource and Efficiency Driven’ and 25 ‘Innovation public stake in the incumbent operator should Driven’ economies are studied (as defined by the World Economic Forum (WEF)) in this first phase. The first step not prevent authorities from enforcing rules for taken is to divide the economy into 3 ‘pillars’, business, fostering competition in the broadband market. consumer and government and assign weights to these Secondly, Turkey should design a complete and pillars. The greatest weighting is given to the business pillar integrated broadband strategy for coordinating since it is a key contributor to productivity growth. For various individual pieces in the same direction. each component of the scorecard countries are benchmarked against the best-in-class in their tier. Low To enable increased ICT and broadband scores reflect gaps in a country’s infrastructure, usage or adoption by businesses the government should both. For more information see “Connectivity Scorecard� at: http://www.connectivityscorecard.org/methodology/ exercise greater efforts to design effective 46 programs and incentives. In particular skill gaps policy areas notably ICTs and innovation. should be identified and adequately addressed Turkey should take measures to address this with participation of private initiatives. problem and ensure reliable and timely indicators are developed and made available to The lack of a suitable national accounting the public. framework for more detailed analysis hinders international benchmarking in most emerging 47 6 References Atiyas, İzak. 2010. Regulation and competition in the Turkish telecommunications industry: an update. In The Political Economy of Regulation in Turkey. New York: Springer. http://research.sabanciuniv.edu/14658/. Information and Communication Technologies Authority. 2011. Annual Report 2010. Ankara: ICTA. http://www.btk.gov.tr/eng/basineng.html. McKinsey & Company. 2009. 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The Global Competitiveness Report 2010-2011. http://www.weforum.org/reports. 48 5.1 Online Resources www.carelink.se/en/mission/sjunet http://www.dtc.umn.edu/mints/home.php http://econ.worldbank.org/ www.oecd.org The Central Bank of the Republic of Turkey at www.tcmb.gov.tr The Undersecretariat of the Treasury at www.treasury.gov.tr Invest in Turkey at http://www.invest.gov.tr http://www.invest.gov.tr/en-US/sectors/Pages/ICT.aspx Export Promotion Center (IGEME) at www.igeme.org.tr http://www.turkstat.gov.tr/PreHaberBultenleri.do?id=8450. http://www.turksat.com.tr/english/v2/cable-services http://www.eutelsat.com/products/broadcast-audience.html Economist Intelligence Unit, news at http://www.ebusinessforum.com/index.asp?layout=rich_story&doc_id=11173&title=Turkey%3A+Over view+of+e-commerce&channelid=4&categoryid=31 Ticktock Boom at http://www.ttboom.com/index.html http://www.connectivityscorecard.org/methodology/ http://www.socialmedia-forum.com/ 49 About infoDev infoDev is a global development financing program among international development agencies, coordinated and served by an expert Secretariat housed at the World Bank Group, one of its key donors and founders. It acts as a neutral convener of dialogue—and as a coordinator of joint action among bilateral and multilateral donors—supporting global sharing of information on ICT for development (ICT4D), and helping to reduce duplication of efforts and investments. infoDev also forms partnerships with public and private sector organizations who are innovators in the field of ICT4D. infoDev is housed in the Financial and Private Sector Development (FPD) Vice Presidency of the World Bank Group. For additional information about this study or more general information on infoDev, please visit www.infodev.org/publications. 50