The Turkish Mobile
Market
The Turkish population is young with
an estimated average age of 29, which is lower than elsewhere in
Western Europe, and the majority of the population lives in urban
areas. In our opinion, these factors indicate growth potential for
the mobile communications market in Turkey.
There are currently three mobile communications operators in Turkey:
Turkcell, Vodafone, and Avea. As of the end of December 2008, there
were approximately 66 million GSM lines and the mobile line
penetration rate in Turkey was approximately 92%, according to the
operators' announcements.
Turkcell operates under a 25-year GSM license, which we were granted
in April 1998 upon payment of an upfront license fee of $500
million. Telsim also received a 25-year license with the $500
million upfront license fee in 1998. Telsim was seized by the
Savings Deposit Insurance Fund ("SDIF") in February 2004 and it was
put up for sale by the SDIF in August 2005, and an auction was held
for Telsim on December 13, 2005 with Vodafone submitting the winning
bid of $4.55 billion. The sale process was completed on May 24,
2006. In 2000, two new GSM 1800 licenses were issued. One of the
licenses were awarded to Is-Tim, a company which began offering GSM
services in March 2001 under Aria brand name was formed by Telecom
Italia Mobile and Isbank, one of the largest private banks in
Turkey. Is-Tim paid a license fee of $2.5 billion excluding taxes.
The other GSM 1800 license was awarded to Turk Telekom. Turk Telekom
began offering GSM services on December 14, 2001, through its brand
Aycell. In February 2004, Is-Tim and Aycell merged to form "TT&TIM"
which is owned by Turk Telekom (40%), Telekom Italia Mobile (40%)
and Isbank (20%). TT&TIM operated under the brand name of Avea.
In November 2004, the Turkish Privatization Agency announced that
55% of Turk Telekom, which owns 40% of Avea's shares, would be
privatized through a "block sale". The public auction for 55% of
Turk Telekom was concluded on July 1, 2005. The winning bid was made
by Oger Telecom's consortium comprised of Oger Telecom, Telecom
Italia and BT Consult, for $6.55 billion, payable over 5 years and
totaling $7.4 billion with interest. The sale of the 55% stake in
Turk Telekom to Oger Telecom was completed on November 15, 2005. In
the third quarter of 2006, one of the shareholders of Avea, Telecom
Italia Mobile, announced that it will sell its 40% stake in Is-Tim
to Turk Telekom and the sale was concluded in September 2006.
Regulation of the Turkish Telecommunications Industry
All telecommunications activity in Turkey is regulated by the
Ministry of Transportation and the Information Technologies and
Communications Authority. The Telegram and Telephone Law No. 406
("the Telecommunications Law"), as amended, is the principal law
governing telecommunications activity in Turkey. The Wireless Law
No. 2813, as amended, and Ministry of Transportation Law No. 3348,
as amended, also includes provisions relating to telecommunications
in Turkey.
The Telecommunications Law was reformed in 2000 and 2001. The
reforms were aimed at modernizing and reforming the legal and
institutional framework for the provision of telecommunications
infrastructure and service in Turkey.
The Information Technologies and Communications Authority is an
independent telecommunications regulator with financial and
administrative independence, which has the authority to grant
licenses and set fees in the telecommunications sector.
You may reach the Information Technologies and Communications
Authority web pages from http://www.btk.gov.tr/Eng/english.htm
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