Gibraltar is a British Overseas Territory located on the southern end of the Iberian Peninsula at the entrance of the Mediterranean. Gibraltar has a digital telephone exchange supported by a fibre optic and copper infrastructure; the telephone operator Gibtelecom also operates a GSM network. Although affiliated to the United Kingdom, Gibraltar remains amongst the smallest self-governing territories in the world, both in terms of geographical size and population.
Gibraltar had an 97.8% Internet penetration rate by the end of 2019. Gibtelecom, which is the incumbent operator, currently has the largest share of the market and provides its customers with broadband and business connectivity services via traditional copper networks and more recently, Fibre to the Node (FTTN) networks.
The broadband and business connectivity market in Gibraltar is currently in the middle of a major transitory phase which, when complete, will potentially improve the level of competition and value of products available to the consumer. This is due to the fact that, until recently, consumers had only two providers from which to choose, both offering very similar products, at similar prices and conditions. However, consumers now have the possibility of having the choice of up to four providers. The Gibraltar Regulatory Authority (GRA), which was established under the Gibraltar Regulatory Authority Act in October 2000, is the statutory body responsible for regulating the electronic communications sector, data protection and the gambling sector in Gibraltar.
Self-sufficient Gibraltar benefits from an extensive shipping trade, offshore banking, and its position as an international conference centre. Tax rates are low to attract foreign investment. The British military presence has been sharply reduced and now contributes about 7% to the local economy, compared with 60% in 1984. The financial sector, tourism (over 11 million visitors in 2012), gaming revenues, shipping services fees, and duties on consumer goods also generate revenue. The financial sector, tourism, and the shipping sector contribute 30%, 30%, and 25%, respectively, of GDP. Telecommunications, e-commerce, and e-gaming account for the remaining 15%. In recent years, Gibraltar has seen major structural change from a public to a private sector economy, but changes in government spending still have a major impact on the level of employment.
After the British Government decided to privatize its Telephone Department, Gibraltar Nynex Communications Ltd (GNC) became the responsible body for fixed-line telephony. GNC Networks was later renamed GibConnect as a result of a joint venture between the Government of Gibraltar and Nynex’s successor company, Verizon. In 2001, BT sold its 50% stake in Gibtel to GNC. Both companies subsequently merged to form Gibtelecom, a joint venture between the Government of Gibraltar and Nynex’s successor company, Verizon. In April 2007, Verizon sold its shares to Telekom Slovenije, which is the incumbent telecommunications operator in Slovenia.