It’s been sometime since we wrote about cheap feature phones for the BoP. Around seven years, if my search does not mislead. But here goes Microsoft. We wish them success. The company billed the €19 device as “the most affordable mobile phone with video and music player”.
In its report titled, “Myanmar: Telecoms’ Last Frontier” the Pacific Telecommunications Council (PTC) explores the realities of Myanmar’s telecom environment. The government of Myanmar wants to leapfrog “from 10 (SIMs per 100 people) to 80 in five years.” LIRNEasia’s chair Rohan Samarajiva has concluded his report in this publication: The challenges before Myanmar are many. But, if the mistakes of its neighbors and peers are avoided and lessons learned and put into effect, the target of 10 to 80 in five years can be achieved. While outlining Myanmar’s strategy for Universal Service Fund, Rohan is explicit at the very beginning of his another paper in the same publication: We at LIRNEasia have been critical of universal service subsidies.
There is value in having deep pockets. My information gives August 4th as the formal launch date of Ooredoo Myanmar. We’ve done qualitative interviews in the Yangon-Nay Pyi Taw-Mandalay triangle where all companies will concentrate their early efforts. Looking forward to completing the analysis and getting the results out. Ooredoo Myanmar has announced it will make mobile phone and internet services available to 30 percent of Burma’s population sometime between July and September this year.
Two years ago, with the help of Haymar Win Tun I published in a Myanmar newspaper a piece entitled “Myanmar is last in the world in telecoms: What can be done.” It was to be published in Bamar as well, but some sad events stopped that from happening. I was happy to see a key concept in that article, that of the “late-starter advantage,” has got legs. Myanmar’s dynamic and understudied market provides a singular chance to observe the “last-mover advantage” as it unfolds. Although Myanmar’s greenfield telecom market holds huge potential, opportunities must be viewed in light of real challenges, including lack of physical supporting infrastructure,poverty, human and institutional capacity and ongoing ethnic tensions.
Health of Internet depends on the diversity of route and bandwidth providers in a country. Less than a month ago Renesys has diagnosed the health of Myanmar “as being at severe risk of Internet disconnection” along with Syria, Turkmenistan, Ethiopia, Uzbekistan, Yemen and others. Not anymore! At 19:26 UTC on 8 March 2014, we observed Telenor Global Services activate the first international Internet connection out of Myanmar that didn’t rely on the services of incumbent MPT. At present, Telenor Global Services (AS15932) is only announcing a single prefix from Myanmar, namely, 103.
When I was interviewed by a journalist from the Internet Journal, said to have one of the highest circulations in Myanmar, I offered him a short piece I had written about Myanmar. It’s now been translated into Bamar (except for the table and my name). The last few paras of the piece: The government intends to establish a regulatory agency within two years. In the interim, the Ministry of Post and Telecom will function as the regulator. There are concerns both about capacity to regulate in terms of technical skills and also in terms of ability to exercise authority over the incumbent allied with a military-backed entity.
Two journalists attended our five-day course on regulation in Taungoo, Myanmar last week. Both interviewed me on the sidelines. Below is the first, from Internet Journal. I can’t read it (cute pictures though); hope you can. Interview in Bamar
While teaching a course on policy and regulation at a very nice, generator-equipped hotel in Taungoo, I was struck by how bad the Internet was and how unstable the electricity supply was. We are used to working closely with the office while on the road, but this proved too difficult in Taungoo and one of us had to advance the departure by one day to ensure projects did not get disrupted. The importance of electricity has been picked up by this analyst, as reported. The costs of Internet subscriptions are expected to decline gradually, particularly for equipment and administrative fees. Announcements that a high-speed Internet cable network is being built this year, and more hydropower dams over the next few years, will have excited the market, it said.
The honeymoon is over and the clock is now ticking in Myanmar’s business hours. In June, the authorities have selected Qatar’s Ooredoo and Norway’s Telenor to run mobile services initially for 15 years. Neither has received the license as yet but both have kept the fingers crossed to get the paper within this year. The government is still processing a new telecom law, which will guide the licenses. Myanmar’s parliament has passed the law in August but the President has returned it to the lawmakers with suggested amendments.
LIRNEasia, in partnership with the Myanmar ICT Development Organization (MIDO), is conducting a training course on ICT regulation in Taungoo, Myanmar from September 28 to October 2, 2013. The information on this course will be posted under capacity building shortly. Taungoo is 3.5 to 4 hours away from Yangon. Yet I considered it a good use of my time to take a break from teaching to travel to Yangon yesterday because our anchor funder IDRC had convened a roundtable of Myanmar researchers and wanted my presence.
The Economist has a piece on mobiles and banking in Myanmar. This is the world’s leading popular publication on economics, but in this case, it appears the hype has overtaken logic. What is banking? It is the business activity of accepting and safeguarding money owned by other individuals and entities, and then lending out this money in order to earn a profit. Mobile can play a role in this, but does the Economist really believe that phone companies will actually do well as deposit-taking and credit-extending entities?
It has been reported that the CEO of Yatanarpon Teleport, until now believed to be 100% government owned, has stated that is company has been privatized, with the government now holding only 5 percent of the equity. However done (auction or negotiation), privatizations are not this secret. The fact that no one seems to know who the owner(s) of the 95 percent of the company are adds to the mystery.
It appears that ability to invest was a critical factor in the selection of Ooredoo and Telenor as the first foreign private licensees in the Myanmar telecom sector. Both have committed to low-price mobile services. Telenor has considerable experience in running profitable operations using the Budget Telecom Network business model. Ooredoo can, I suppose, buy that expertise. If they do not succeed in running a BTN model in Myanmar, it will be their money that will go down the drain.
The legislature has completed its work and the bill awaits the President’s signature. But the actual legislation with 70 amendments from what potential investors saw is yet to see the light. And most of the detail (“the devil is in the detail”) will be in subsidiary legislation. Another nugget that has emerged is that Ooredoo is planning to invest USD 15 billion while Telenor is planning to invest USD 2 billion. MP Phone Myint Aung said the move would mean “international operators can launch their operations.
Telecomasia.net quotes the New Light of Myanmar, government publication, to the effect that the law now has only one step more to go: Presidential approval. Myanmar parliament has passed the telecom bill which will allow the nation’s mobile licensees to commence operation. The Pyidaungsu Hluttaw (Union Assembly) approved the Communications Bill this week, state-run New Light of Myanmar said on Wednesday. “As the Pyidaungsu Hluttaw approved the Communications Bill, [state-run telco] MPT and international operators can launch their operations,” the paper cites MP U Phone Myint Aung as saying.
It was not long ago, that we thought the Myanmar would remain asleep whilst the rest of the world (save maybe North Korea) reaped the rewards of a vibrant telecommunications sector. Even a few short years ago, the only phone connectivity was through kiosks such the one depicted in the photo, a mobile SIM could cost upwards of a few thousand dollars. But things are changing. Myanmar is opening up. Two mobile operators have been licensed.