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4G launches in Burma

Burma’s increased demand for mobile data is facilitating competition among telcos. Source: globalizationinburma.weebly.com

Competition among telecom players in Burma is heating up as two foreign players launched 4G services to match the increasing data demand in the developing country, reports The Nation.

Telenor Myanmar launched a 4G service in Nay Pyi Taw two months after Ooredoo Myanmar launched their 4G service in the capital city along with Yangon and Madalay.

According to the Ericsson Mobility Report 2016, only 5% of mobile subscriptions in Southeast Asia were 4G, but the figure is set to increase to more than 40% by 2021.

There is now an increasing demand for faster networks in the country, with plans to introduce other 4G services with high voice definition in the future.

“To provide high speed 4G services all over the country, Telenor will need more spectrum. Telenor is looking forward to participating in the spectrum auctions planned by the Union Government later this year. Due to explosive growth of data and increasing data demand by the Myanmar people we believe it is urgently required to expand our services to 4G all over Myanmar.” Petter Furberg, the outgoing chief executive officer of Telenor Myanmar.

Telenor claims to be Myanmar’s largest network with more than 5,700 towers and 16 million customers. Over 60% of its customers are data users.

Its competitor, Ooredoo, states that its penetration rate is at 85%, with a goal to be the best data network in the country. It has extended its fibre optic network to 7,700 km with plans for more expansion by the end of this year. Ooredoo has already invested $1.7 billion to develop 4G in Myanmar.

The company promises to keep 4G price the same as with 3G and customers can enjoy free calls and use Facebook at the price of $0.003 (3 kyats) per megabyte.

As more civilians become tech-savvy, it becomes necessary for broadband networks to be faster in Myanmar. This makes Burma a golden opportunity for more telecom companies, local and foreign, to emerge in the market.

A version of this appeared in The Nation on July 11. Read the full version here.

Ericsson Mobility Report

Fig.1: Mobile subscription is set to increase at a compound annual growth rate

The Ericsson Mobility Report, published in June, presents a market overview of mobile broadband and smartphone availability in Southeast Asia and Oceania. Find the key takeaways below:

  • Smartphone subscriptions are expected to increase at a compound annual growth rate (CAGR) of 15%, up until 2021 (See Fig.1).
  • The rise of mobile broadband is due to smartphone availability and popularity of data intensive apps (leading to a competition of data driven bundle deals by Thai mobile carriers).
  • Mobile broadband growth has the potential to trigger an entirely new wave of growth across Southeast Asia, opening up opportunities for innovation in apps and services
Ericsson Mobility Report

Fig.2: Line is the most popular app in Thailand, whereas other countries in the region prefer the Facebook trifecta.

Unlike Whatsapp, Line users in Thailand are able to do more than messaging on the app. Line offers payments, branded content through mobile marketing and has now branched out to food delivery. This would explain the app’s popularity in the country, whilst Whatsapp remains the go-to choice for smartphone users in Malaysia, Indonesia and Singapore.

Smartphone Use In Southeast Asia

Ericsson also reports that in Malaysia and Thailand, almost half of smartphone users access social networking, instant messaging and online videos on a daily basis (40-50%), making the two countries very mobile driven. This focus on mobile leaves a lot of room open for mobile commerce opportunities, from payment platforms to shopping (see Fig.3)

Ericsson Mobility Report

Fig.3: Thailand and Malaysia has the most daily users of social networking apps

When it comes to the profiles of daily smartphone users, there are differences between countries. However, there is an overrepresentation of users who are young and educated from a regional level.

Ericsson Mobility Report

Fig.4: Currently, Wi-Fi has the larger share of overall smartphone traffic

Southeast Asia’s mobile broadband and Wi-Fi data traffic on smartphones continues to grow. User generated data shows that all markets in the region experienced increases in average data traffic per user for mobile broadband and Wi-Fi. Leisure time apps, such as games are not necessarily data intensive but are often accessed from home, this also contributes to Wi-Fi growth.

Mobile Subscriptions in Southeast Asia

Ericsson Mobility Report

Fig 5: Indonesia leads the way in mobile subscriptions

  • Singapore, Malaysia and Thailand are expected to have more than 100% mobile broadband subscription penetration by the end of 2016.
  • Mobile subscriptions in the region will grow annually at 4% between 2015-2021, totaling to 1.2 billion by the end of 2021.
  • Mobile broadband services are foreseen to account for more than 90% of total mobile subscriptions in the region by the end of 2021.

Although fixed broadband subscription penetration is still low in emerging markets, compared to mobile broadband, the region has been seeing a growth in middle income households that should contribute to the rise in demand or high speed broadband services in residential areas. This is particularly true in Thailand, Indonesia, Philippines, Vietnam and Malaysia.

Mobile broadband will still be the main form of broadband access for the majority of people in the emerging markets of Southeast Asia. This opens up a window of opportunity for operators to fill the need for home broadband.

Network Performance In the Region

Communications is increasingly becoming more app centric, with video streaming to be accounting for almost 70% of all global mobile data traffic by 2021. The increasing popularity of video streaming services on smartphones is driving innovation in video compression and display technology. In order for videos to be fully utilized, a high speed network is much needed.

High expectations will continue to be placed on network performance. This should be challenging for developing countries. As mobile connectivity grows, network connectivity should be experiencing similar rate of growth in order to facilitate innovation.

Download the full Ericsson Mobility Report, June 2016, here.