Twelve is still a big number, especially when one includes the consortia members. Of the usual suspects, only NTT, Hutch, Etisalat, and Orascom are missing. Of all the cash-rich Gulf and Middle East players, only Qatar is still in the fray. Philippines’ PLDT is out, but that is really not news. Millicom is a bit of a surprise, as is Digicel, a specialist in small markets (which Myanmar is not).
Many talk about corruption in telecom procurement by government owned telecos. Here are details: According to a police source familiar with the probe, a suitcase containing US$2 million in cash was allegedly found in Thein Tun’s residence. Investigators are trying to establish whether the alleged funds may have originated from foreign firms, including major Chinese companies Huawei and ZTE known to be angling for potentially lucrative telecom contracts in Myanmar, according to the same source. Authorities are also trying to gain access to bank accounts in Bangkok, Hong Kong and Singapore where kickbacks to senior ministry officials may have been deposited, according to the same source. Both Chinese companies have voluntarily given investigating authorities documents related to their previous deals with the MPT ministry, including during Thein Zaw’s tenure as minister, according to the police source.
Who would have thought? A UK-based global operator that emerged in the competitive era joining with China Mobile, the big dog in China, to bid for a Myanmar license. Operator heavyweights China Mobile and Vodafone Group have formed a consortium to bid for a mobile licence in Myanmar. Keen to promote competition, Myanmar wants to increase the number of mobile operators from two (Myanmar Post & Telecommunications and Yantanarpon Teleport) to four. In a statement, Vodafone laid out some of the attractions of entering this market.
Digicel made its name and fortune in the Caribbean. Then it became a major regional player in the Pacific. Now it is hoping to land a license in Myanmar, a much larger market than the ones its operates in. Interestingly, they are pushing for an enabling framework for mobile money, even ahead of getting the telecom license: “The telecommunications sector offers many opportunities, and companies can provide a variety of services in this industry,” said Lorna J. McPherson, the operations director of the Irish-owned Myanmar Digicel Company.
It appears they want to play: Google chairman Eric Schmidt speaks on March 22 in Yangon. The company has big plans for Myanmar, and they’re closely linked to the country’s plans for mobile. Myanmar’s President, Thein Sein, has set a goal of 80% mobile-phone penetration by 2015, from current rates of 9%. With internet penetration as low as 1%, and fixed-line telephony penetration in the single figures even in big cities, mobile networks will be the only way the vast majority of Myanmar’s 50 million people can get online, and will serve as the main communications infrastructure for a modern information economy, including banking, media and civic services. A speculative piece.
It appears from news reports that the Myanmar government has commenced work on a domestic fiber backhaul network. This was among the recommendations of the oped that I published in a Myanmar newspaper last year. But as experience has shown in country after country that it is easier to build backhaul than to ensure that it is efficiently used (see downloadable book, chapter 7). For this, an open-access regime based on cost-oriented pricing and non-discriminatory access is essential. The farmlands were dug twice, while burying cables along the roads in Thapyay San village, Magway township, one of the locals said.
Total Telecom gives details of the licenses that will be issued in Myanmar upon the completion of a three-stage process. Technology neutral is good. How much spectrum per license is not stated. If it is 5 MHz, as the rumor mill says, it is unlikely that the government’s objective of 80 SIMS per 100 people can be achieved. After the 4 April deadline, the Committee said it will reveal the applicants that have qualified for the next phase of the licensing process, stage three, which will decide which two companies will be awarded the licences.
The liberalization process in Myanmar is chugging along, with an arrest or two, bad advice from the ITU Regional Office and so on. Hope things will get better. In a poor country like Myanmar, it is hard for grassroots people to get a cell phone. The price has dropped to 150,000 kyat but there are just 1.24 million mobile phones in a country with a population of over 60 million.
The government of Myanmar has received 91 expressions of interest for telecom licenses. We were not surprised when the number hit 18, but 91? Now the question, according to Bloomberg, is how to narrow down the field in the next two stages, down to two: Rules for the second stage, where bidders eligible for the third and final stage will be determined, will be provided “in coming weeks,” according to last week’s statement. “Having prior emerging market experience should be beneficial, along with the ability to deploy capital, relationships with the equipment vendors or handset procurement,” Gupta said. “Reforms in the telephony sector are critical for overall development and progress, so they will need to be mindful of security and social issues too.
With eighteen companies having thrown their hats in, it is easier to discuss who has not, yet. Of the groups active in the region, the most notable absentees are the Arab groups: Etisalat, Wataniya, Zain, etc. Ten years ago, we would have expected to see Telstra and at least one American company, but not now. South African telecoms group MTN is in talks with Myanmar’s Directorate of Investment and Companies Administration (DICA) with a view to gaining an operating licence in the south east Asian country, local source Eleven Newsmedia reported. MTN is thought to have joined a list of around 18 companies which have submitted an expression of interest (EoI) in acquiring Myanmar licences, including India’s Bharti Airtel, Singapore’s SingTel, Malaysia’s Axiata, Caribbean group Digicel, Singapore-based telecoms investor ST Telemedia (with interests including StarHub and Malaysia’s U Mobile), KDDI of Japan, Thai operator AIS (via parent Shin Corp/InTouch) and Norway’s Telenor (parent of Thailand’s DTAC).
It appears that previously expressed hopes for a good law on telecom emerging from the recesses of Nay Pyi Taw were overly optimistic: Information-technology experts and entrepreneurs have proposed amendments to Myanmar’s telecommunications bill that was made public last month. Khun Oo, president of the Myanmar Computer Federation, said the information and communications technology sector could develop rapidly, but it could also decline because of the new law. Ye Yint Win, president of the Myanmar Computer Professionals Association, said: “According to Section 4 Article 7, every telecommunications services will need a licence. Web-development businesses, e-commerce businesses and individuals who want to sell their applications will also need licences. So [the law] needs to separate and identify the services that need licences and those that do not need licences, as it can harm freedom of creation and small enterprises.
Internews is a US based organization that engages in hard work of helping the producers of news and information do their jobs better. Not in the space that LIRNEasia occupies, so our interactions have not been many, but my impression has been of people who are trying to make a difference by working at ground level, quietly. Therefore, I took seriously the op-ed written by its CEO on Myanmar. Here is an excerpt. For now, the reforms and the apparent end of censorship have unleashed a veritable media gold rush in Myanmar.
In July, I wrote that Myanmar was about to adopt a flawed telecom law, which had the support of the Bangkok Office of the ITU. Appears that saner counsel had prevailed: Two other sources with close knowledge said the government realized its mistakes this July, when a revised law sent to President Thein Sein was quietly recalled because it was “deeply flawed”. A senior government official said Thein Sein wants to implement reforms fast, aware of the proven links between telecoms expansion and GDP growth and the urgent need for transparency in a crucial sector. Expansion and liberalization would not only create thousands of jobs in a country with chronic unemployment, but it would also allow for mobile money services, like transferring cash that could be collected by a relative in rural areas by showing a simple text message. “It’s not just phones, it’s other cross-cutting factors.
Having a customer-centric sector seems a good idea. The Ministry seeing its primary function as that of taxing operators a tad problematic. What is a public switchboard telephone network? But this is what is trickling out of Myanmar. “The Department of Posts and Telecommunications will be coordinated by the Ministry of Communications, Posts and Telegraphs, which will tax operators,” U Kyaw Soe said.
Reports are coming out about the Myanmar government’s plans for the telecom sector. Sadly, little seems to have been learned from the rich experience of the past two decades. Why otherwise would there be an interest in maintaining 51% ownership of the new operators? More interesting is the line about developing a national backbone. Are the rules for open access being drawn up?
We learned to our great sorrow that Haymar Win Tun passed away. Our condolences go to her family and many friends, among who are many from LIRNEasia and CPRsouth. She was at LIRNEasia only for a short time and attended only one CPRsouth conference, but the bonds that were forged were deep and strong. It is a tragedy when a young person dies; it is an even greater tragedy when a person of great potential dies. Haymar was a person of great potential.