Infrastructural development needed for Sri Lanka’s telecommunication sector

Posted by on July 13, 2021  /  0 Comments

Data usage in Sri Lanka has exploded by a hundred percent between March 2020 and the beginning of July 2021, with increasing complaints against service providers over speeds, connection drops and bad quality.

LIRNEasia Chair, Rohan Samarajiva shared his expertise with the Sunday Times on the challenges faced by Sri Lankan telecommunication service providers saying that “infrastructural development is time-consuming, and the need for more infrastructure becomes apparent when there is more traffic.”

When you compare data prices across the world, Sri Lanka is significantly cheaper, he said. LIRNEasia conducted a national study for Nokia around a decade ago on how companies could charge such low rates. It showed this was because of the local industry’s business model– cost cutting occurs at the expense of quality. These issues are exacerbated when usage peaks with more people online.

South Asian companies pruned costs by, for instance, introducing the prepaid package system which eradicated challenges like bad debt which requires more employees to solve. Or they cut down customer care to offset the low prices and heavy investment.

The study also revealed that local telcos didn’t stick to manufacturer guidelines regarding certain technical features, overusing these beyond recommended degrees. This was akin to a vehicle designed to carry four persons taking five or six instead. But low prices also mean more people had access to internet, including low income earners. The trade-off is quality.

Ideally, telcos should have standby infrastructure to deal with usage surges. However, the industry does not charge its customers enough to maintain excess capacity.

Read the full article published on the Sunday Times on 11 July 2021.

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