Ukraine’s Internet service providers (ISPs) have taken one more step to reduce the cost of access to the Web for its cash-strapped users.
Eight of the country’s largest ISPs – Golden Telecom, Global Ukraine, UkrSat, Technological Systems, Adamant, IP Telecom, Relcom Ukraine and Ukrnet – announced Sept. 13 the creation of a center for exchange of Internet traffic called UA-IX.
According to industry analysts, UA-IX will facilitate direct exchange of Web traffic within the country’s Internet backbone rather than via external channels in neighboring countries, such as Russia, as was previously the case.
The results, they say, will be faster and cheaper Web surfing.
Nine other smaller ISPs from the Kyiv, Odessa, Lviv, and Kharkiv regions have also joined the exchange for a $50 fee.
Earlier in the month, the country’s major ISPs announced a 40 percent to 66 percent reduction in their rates for leased lines in hope of increasing their clientele base and making profits via volume.
The cost of dial-up connections, however, has remained unchanged at around $40 a month despite an indirect but effective price hike for customers that occurred earlier in the summer (June 9) when the country’s state phone monopoly Ukrtelekom doubled the cost of local calls from seven kopeks to 13 kopeks per minute.
Unlike in many Western countries, where the local phone calls to the ISP’s computer for dialup access are covered by small flat fees, Ukrainians connecting to the Internet via dialup pay the local telephone company for per-minute service in addition to the ISP fee.
The number of Internet users in Ukraine, currently estimated at about 500,000, is expected to increase significantly in the next few years. Analysts forecast the number of Internet users in Ukraine will reach 1 million by the end of 2000 and double by the end of next year.
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The National Bank of Ukraine (NBU) has sent a letter to commercial banks asking them to provide recommendations for regulating e-commerce. According to the letter, the NBU has developed a draft document to legally define and regulate the sector.
Several of Ukraine’s top banks, including Bank Aval and Privat Bank, have already announced that they are examining the possibility of offering e-banking; in particular, selling services through the Internet.
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Utel, Ukraine’s international telephone monopoly, is introducing a new service for prepaid Internet access called Unet. According to Ruslan Fursov, a sales expert at the company, subscribers will be able to connect to the Internet from any telephone in Ukraine by dialing 8-800 and typing in their login and password. Fursov added that the project has already been introduced in several Ukrainian cities including Kyiv and Odessa.
Utel collected Hr 979.40 million in revenues and made a pre-tax profit of Hr 401.20 million in 1999, up significantly from the previous year’s revenues and profits of Hr 679.30 million and Hr 185.5 million respectively.
