This report provides a comprehensive overview of the trends and developments in telecommunications, broadcasting and pay TV markets in Afghanistan, Bangladesh, Maldives, Pakistan and Sri Lanka. Subjects covered include:
Fixed network Services
Content and E-services
Mobile and Mobile Data
Afghanistan As the political and social rebuilding of Afghanistan proceeds following years of war and civil unrest, the country has started putting a new national telecommunications infrastructure in place. The 2001 war destroyed a telecommunications network already suffering serious disrepair due to neglect by the Taliban. The nation’s network of telephone lines was left barely functioning. With telecommunications set to play a crucial role in rebuilding the country’s shattered economy and society, a properly functioning basic telephone network was always a priority. An important step was the creation of the Ministry of Communications (MoC) by the Transitional Government in early 2002. The challenge has been to attract and manage foreign investment in the country. There have been some positive signs in this regard.
In 2003, the second GSM mobile service in the country was launched, while another two mobile licences were issued in September 2005. By end-2005, the mobile subscriber base had reached about one million. In the meantime, the government, in a push to develop the fixed-line network, launched what it called the Local Fixed Service Provider (LFSP) program. This program was expected to see hundreds of small-scale investors set up companies at the village or provincial level using Wireless Local Loop (WLL) technology.
Bangladesh ranks among the most densely populated countries on the globe, but its fixed-line teledensity remains the lowest in South Asia. With teledensity at less than 1%, only a relatively small proportion of the population had access to any telecom facility. Almost 99% of homes lacked a telephone and there was a four year waiting list for fixed-line services. The overall situation has been improved to some extent by a rapidly expanding mobile market. But after a number of years of strong growth, mobile penetration was still only a little over 5% at end-2005.
The establishment in 2001 of a new regulator, the Telecommunications Regulatory Commission (TRC), signalled the start of a new push to reshape the country’s telecom sector. The government can be expected to continue to vigorously pursue the de-regulation process. Expanding the national telecom infrastructure remains a priority. A critical factor is that Bangladesh has some of the most underdeveloped telecommunications infrastructure in the world. Given its 150 million population, the country has limited capacity to support telecom services on any scale. About 80% of the telephone lines are in Bangladesh’s four main cities, while 80% of the population lives in some 86,000 rural villages. By end-2005, Bangladesh had close to one million fixed-line telephones, mostly provided by the state-owned Bangladesh Telegraph and Telephone Board (BTTB) and just over 7.5 million mobile phone subscribers with service provided by six private operators.
The Maldives with its relatively small population of 300,000, could rightly claim an efficient, up to date national telecommunications system, despite it being spread of a large archipelago of islands. Dhiraagu, the country’s monopoly telco, has invested considerable effort to ensure that there is now full and effective telephone service covering the whole country. As well as operating the fixed-line network, the company also operates a mobile service and is an Internet Service Provider (ISP). Dhiraagu’s monopoly was officially set to run out in 2008, but the government was keen to open up the market earlier than that and this was starting to happen progressively. The licensing of a second ISP in 2002 signalled that the government was already moving on its plans to open up the market ahead of time. Dhiraagu has responded by increasing its product range and improving its customer service. Then, in 2004, a second mobile licence was issued, again resulting in the incumbent moving quickly and aggressively to increase its presence in that sector of the market.
Pakistan After a period in which the country slowly transitioned from a regulated state-owned monopoly to a comparatively deregulated competitive structure, Pakistan’s telecom sector had finally begun moving and looked set for an era of phenomenal growth. Fixed-line penetration stood at a low 4% (5.9 million lines) in early 2006, with plenty of room for further expansion. The government is continuing to pursue its targeted national teledensity of 7% (around 10 million lines) by 2010. To achieve this target, around 1 million additional lines need to be installed every year. In the meantime, Pakistan’s mobile sector, which had started to grow strongly over the last few years, continued its rapid expansion. After growing by almost 170% in 2005, the mobile subscriber base had reached 22 million (14% penetration) in early 2006.
The government’s reform plans were being progressively implemented and this is certainly starting to have some impact on the market. The country’s four mobile operators have been joined by two new operators - Warid Telecom and Telenor Pakistan - following a decision by the government to issue two additional mobile licences. By end-2005, after less than 12 months operation, Telenor had 1,870,000 subscribers and Warid Telecom claimed 2,070,000. An important aspect of reforming the telecom sector was the privatisation of PTCL (Pakistan Telecom). In June 2005, the UAE operator, Etisalat, submitted the highest bid of US$2.6 billion for a 26% stake in PTCL. Despite lodging the winning bid, the acquisition took a further six months to complete after a dispute over payment terms arose almost jeopardising the sale.
Sri Lanka has been demonstrating considerable determination in its efforts to develop the country, this despite its ongoing political problems. With a modern progressive telecommunications sector high on the list, the sector looks to be well positioned for vigorous growth. The country’s fixed-line teledensity was approaching 6% and mobile penetration was over 17% in early 2006, with annual growth of the mobile sector running in excess of 50%. The strong growth looks very much like it was set to continue. There are a range of major initiatives being put in place that are set to give a boost to the building of national infrastructure and open the market to even more competition. Sri Lanka Telecom progressively losing its monopoly on a range of services has led the way as the market is made more interesting for new players. It is well recognised by the government that for economic well-being the country needs the ready availability of Internet, e-finance, e-commerce and all the other communications facilities products that play an important role in global commercial activity.
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