Silknet questions optic fiber cable tariffs
26 May, 2011
Silknet questions optic fiber cable tariffs

Silknet, a monopolist of fixed line cable infrastructure, hates to pay non-contracted increased tariff to Georgian Railway LLC, the state owned railway monopolist owning also the trunk optic fiber cable that provides all three South Caucasus countries with the internet.

Georgian Railway assures tariffs were increased to Silknet through the contract.
Georgian National Communication Commission (GNCC) has to solve the tariff-and-contract dispute between Georgian Railway and Silknet unless sides will not achieve an agreement till May 31, 2011.
The dispute emerged

after Georgian Railway raised annual transmission tariffs fixed as GEL 300 thousand for its optic fiber cable to roughly GEL 800 thousand in 2010 under the pretext that prices at the market increased generally and Silknet, that within itself is a monopolist owner of fixed line underground cable network throughout the country, increased similar tariffs to other Internet Providers (IP) that use Silknet service.
Silknet was founded in 2010 through merger of three companies including United Telecom of Georgia (UTG) that actually owned the fixed line cable infrastructure covering entire Georgia and enjoyed the largest fixed line consumer coverage, Wanex –an internet provider, and Ajara Elektrokavshiri [Ajara Electrocommunication] – a fixed line provider in Ajara region. UTG also started IP business in summer of 2007 and beforehand raised its tariffs fixed for broad band cable service as GEL 3.5 per DSL unit to GEL 21 in April of 2007. However GNCC cut the tariff to GEL 11.68 ultimately.
Commensurately, Silknet including the UTG within itself enjoys these tariffs at the moment and Georgian Railway that is responsible for management and maintenance of the main optic fiber cable running alongside the entire length of the main railway line [that is a part of Caucasian railway corridor and takes 1323, 9 km] and provides with the internet Azerbaijan and Armenia as well believes it has full right to enjoy higher tariffs too.
“The contract empowers Georgian Railway to oversee tariffs each year based on the decision of international audit we carry on each year,” Irma Stepnadze, PR Manager of Georgian Railway, said.
The cable consists of 12 line pairs out of which Silknet owns 4 pairs and one is owned by Railway Telecom LLC, a Georgian Railway asset handed to the Ministry of Economy and Sustainable Development of Georgia in 2010. The state structures including interior and defense ministries are allegedly using the remainder line pairs, but Georgian railway neither approved nor denies the information.
Silknet assures that the raised tariffs are not valid as they  were not built in the contract of 2010 as Silknet finds the tariff hike groundless and refuses to pay it. To escape possible halt of service Silknet appealed to communication regulatory body with the request to ensure its admission right to the optic fiber. Silknet does not make official comments till the two-week negotiations with Georgian Railway are completed. But a trustful Silknet source informed Georgian Journal that Georgian Railway cannot claim for as high tariff as the Silknet as far as the optic fiber cable infrastructure that exposes on the surface and frequently is damaged differs from the well-secured underground cable infrastructure of the Silknet laid deeply in the ground.
“The optic fiber cable is not laid underground throughout the entire length and is not as protected as the underground cable infrastructure of the Silknet, in some places it runs in the air, or across the rails at bridges, or is laid only at depth of 20 centimeters while our cable network is deeply laid in the ground and is absolutely secured. You all remember how a woman digging potatoes in the yard cut the optic fiber cable accidently leaving the entire region without internet recently. Commensurately our services differ very much and similar tariffs cannot be fixed on them,” The Silknet source told GJ.
GNCC confirms that these two cable infrastructure are not similar but refrains to make more in-depth comments till the negotiation period required by disputing sides expires.
Georgian Railway assures that the new tariff was proposed to the Silknet in full observance of contract terms, and that it has full right to increase tariffs based on annual international audit data.
According to GNCC, the disputed contract was not signed in fact and GNCC will undertake due efforts to regulate the conflict without court.
Georgian Railway legal experts say they already sue Silknet through court and the court decision will be made public.

 

Print
Other Stories
The World Digital Mining Summit to be held in Georgia
The summit is scheduled to take place between 21st-23rd September in the Hualing Hotel, Tbilisi, Georgia.
Galt and Taggart - Tourism Boom Continues in Georgia
Tourism has become one of the key drivers for the Georgian economy. Galt and Taggart has recently published research about the Georgian tourism sector in the first half of 2018.
"The worst dream for Putin is that Russians want to live in Georgia"
This year, visitors to the Adjara region would notice that there is a boom in construction in and around Batumi.
Underground gas storage facility to be built in Georgia
KfW, a German government-owned development bank signed a EUR 150 million promotional loan with the state-owned Georgian Oil and Gas Corporation (GOGC) for the construction of the first underground gas storage facility in Georgia.
New gambling rules for Georgia
Georgian lawmakers are preparing a new draft law relating to online-casinos and gambling that will seek to curb gambling addiction in Georgia.
How expensive is it to visit Georgia?
The Georgian Lari (GEL) is the official currency of Georgia and is the only legal means of payment in the entire territory of Georgia.
Trade with the EU and the Commonwealth of Independent States (CIS) has grown significantly
Trade with the EU and the CIS has grown by 26% and 33.5 % respectively, says GeoStat, the Georgian National Statistics Office.
The unemployment rate decreases in Georgia
The unemployment rate decreased in Georgia by 1,9% and amounted to 12.1% in the 2nd quarter of 2018 compared with the previous quarter,
Memorandum of Understanding to be signed between Georgia and Malaysia
According to the Georgian Ambassador to Malaysia Nikoloz Apkhazava, Georgia plans to sign a Memorandum of Understanding (MoU) with Malaysia.
“Blauenstein Georgia” due to expand in Georgia
“Blauenstein Georgia” is planning to open more shops in Georgia. It is an agriculture company that sells meat products, meat and convenience food.
The amount of Direct Foreign Investment rises in Georgia
According to the information of the National Statistics Office of Georgia, the amount of direct foreign investment in Georgia has risen
It’s going to get  harder for foreigners to get residence permit in Georgia
It’s going to get harder for foreigners to get permit of residence in Georgia.
Mziuri Park in Tbilisi to be renovated soon
It was the dream of prominent Georgian writer Nodar Dumbadze that when the original Mziuri park was constructed and opened in 1892 that it should be a park for children,
Winemakers to produce Kvanchkara in its place of origin - Racha
Khvanchakara is a semi-sweet Georgian red wine which originates from Racha, in the western part of Georgia. Kvanchkara is made of two types of grape Mujuretuli and Aleksandrouli.
The level of Georgian wine and Chacha exported has increased
The National Wine Agency of Georgia has recently published statistical information about the level of Georgian wine and Chacha exported between January and July, 2018.
New fire engines to be Manufactured in Georgia
The Acting Head of the Emergency Management Agency Shalva Khutsishvili said that the old Zili fire engines (which were made in the USSR) will be phased out and replaced with new ones, manufactured in Georgia.
Georgia witnesses a record number of tourists
The Georgian National Tourism Administration publishes statistical information about international visits to Georgia.
Canadian businessman plans to build a hotel in Bakhmaro
Canadian businessman Vadim Malishev plans to build a hotel in Bakhmaro resort, Guria, in the western part of Georgia.
Coffee Factory will open in Tbilisi in October
The first coffee factory (which will be located on the Kakheti highway) in Tbilisi will open in October.
Places in Georgia where real estate is the most expensive
The real estate market in Georgia is growing annually. In Tbilisi as well as other regions of Georgia new developments are increasingly taking place.
How much does a vacation cost in Tbilisi?
It is the middle of summer and those who have not yet taken a vacation are looking for an appropriate place for sure!
The price for extreme sports in Georgia
Georgia offers a variety of options to extreme sport lovers.
The number of Georgians who own property abroad increases
The number of foreign properties owned by Georgians is increasing.
How much does Taxi cost in Tbilisi?
Stories how Taxi drivers try to deceive passengers and charge them with more money than they should pay are known for everybody all over the world.
What are the highest paid areas in Georgia
According to the data collected by the National Statistics Office of Georgia in the first quarter of 2018 the highest paid jobs in Georgia are found in the financial and insurance fields.
PHOTO OF THE DAY
Exchange Rates
GEL Exchange Rate
Convertor
24.09.2018
25.09.2018
USD
1
USD
2.6216
2.6226
EUR
1
EUR
3.0854
3.0868
GBP
1
GBP
3.4584
3.4416
RUB
100
RUB
3.9340
3.9814
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange
USD
1
USD
2.6226
EUR
1
EUR
3.0868
GBP
1
GBP
3.4416
RUB
100
RUB
3.9814