Amid slowing demand in the economy, the Myanmar telecommunications sector is expected to be among the handful of sectors yielding opportunities for growth in the coming fiscal year.

In the 2018-19 National Planning Bill signed by President U Win Myint on September 21, telecommunications was projected to grow by 15 percent between October 1, 2018 and September 30, 2019.

“The Myanmar telecommunication sector has made progress year after year. For businesses to be able to operate efficiently, telecommunications services are essential. As market demand rises, there will be more foreign direct investments as well as local investments into this sector,” said Daw Nyein Chan Thu, public relations and internal communications manager at Amara Communications Co. Ltd, which provides internet services in Myanmar.

Despite being one of the least developed economies in Southeast Asia, Myanmar is on par with its neighbours in terms of mobile phone and internet penetration. According to a government survey in the previous fiscal year, there were 56.8 million mobile phone users in 2017-18 against a total population of 54 million, implying a penetration rate of more than 100 percent.

In fact, 4G availability in Yangon is currently the fourth highest in ASEAN at over 80 percent, trailing Bangkok, Singapore and Jakarta but ahead of Kuala Lumpur, Phnom Penh, Ho Chi Minh City and Manilla, according to a May report by OpenSignal.

In Myanmar, there are three foreign operators - Norway’s Telenor, Qatar’s Ooredoo and MyTel, which is run by the Vietnamese military. The fourth operator, Myanma Posts and Telecommunications (MPT) is State-owned.

Meanwhile, there are also more than 140 licensed internet service providers (ISPs) such as Amara Communications, which launched Myanmar’s first 4G+ wireless broadband data-only service in May, well as Myanmar Net, Myanmar Information Highway Company (MIH), NTT Communication Company, Capana Company, True International Gateway Company.

Competition in the sector is getting intense, with the telcos and ISPs rushing to secure market share at the expense of margins. When it launched in May last year, Myanmar SpeedNet was charging customers US$95 a month for 2mbps and a US$250 set up fee. Today, customers pay just K28,000 per month for the same amount of data. Meanwhile, set up fees have dropped to US$90 and customers who commit to a six-month contract do not have to pay any set up fee.

Myanmar SpeedNet is competing against the likes of Amara, which charges customers K35,000 per month for unlimited data.

“Myanmar’s telecom and internet sector will improve. As the number of operators increases and competition intensifies, customers stand to benefit,” said U Thiha Thura Mon, a director at MIH.

Ko Wai Phyo Aung, communications manager at Oppo Company, added that “in the coming year, data consumption in Myanmar will increase substantially. That will draw more investments into the sector. Meanwhile, the keen competition between the service providers will lead to better quality and services in 2019.”

As the infrastructure improves and a higher number of licenses to operate on various frequencies are awarded, investments are expected to rise. “Foreigners are interested in Myanmar’s post and communications sector. They want to make investments and offer new services. The telecommunications sector is a highly profitable sector,” said Ko Zin Min Tun, an executive in the local internet service industry.

Among the largest investors are the four telcos. Since entering the Myanmar market in 2014, Telenor and Ooredoo have ploughed more than US$2billion into expanding their reach in the country.

Meanwhile, MPT has also committed to investing US$2 billion over 10 years to providing high-quality services in cooperation with Japan’s KDDI Corporation and Sumitomo Corporation.

By The Myanmar Times(Published: 27/09/2018)

https://www.mmtimes.com/news/telecommunications-sector-bright-spot-economy-2018-19.html

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