Laos - Telecoms, Mobile, Broadband and Digital Media - Statistics and Analyses
Still no progress on setting up telecom regulator in Laos
The telecom sector in Laos still has numerous issues to address. The rate of regulatory reform continues to be well behind wider industry development, even allowing for the country being a developing economy. The delays in reform have the potential to derail the good progress already made if the process is not speeded up.
The accession of Laos to the WTO was finalised in early 2013. As a consequence Laos was required to implement its post-WTO accession agenda. Of critical importance for the country's telecom sector, the WTO Reference Paper on telecommunications among other things called for the setting up an independent telecom regulator. Indeed, this was required to be put in place two years after accession (ie by February 2015). By February 2016 this had not been achieved. It was understood that work was proceeding on the matter, but no formal steps had been taken.
The country's mobile sector has been going through a difficult period. Following the Beeline saga back in 2011/2012, the fallout was still being felt into 2016. A cloud of uncertainty seems to be hanging over the whole market. Subscriber growth weakened after the market had gone backwards. The cellcos are now operating in an environment where the regulator is keeping a tight hold on pricing and open competition is in effect discouraged. A further problem emerging for the mobile operators is that network performance is deteriorating across the board. This in turn highlighted two important issues there has been insufficient investment by the operators in the areas of network maintenance and upgrades, and, secondly, there are obvious deficiencies in the regulatory environment in how the authorities apply and manage network performance standards. It is understood that the MPT has started to address the latter problem.
Internet services in Laos continue to lag. This remains a major concern in terms of the overall social and economic development of the country. The good news is that since 2011/2012 there has been a boom in mobile broadband internet services (although it has been hard to get reliable statistics on this part of the market). The expansion of internet and especially broadband into the provinces and the rural areas is high on the government's list of development priorities.
On a positive note, the Lao economy continues to perform well and the IMF has forecast further strong growth, at least in the short term. In the last five or six years there certainly has been a noticeable shift in the economic and social outlook for Laos. After a number of decades of having to struggle with a poorly performing economy and a commercial environment that was in desperate need of reform, there is now positive news being reported on many fronts for this nation of almost seven million people. Most importantly, a significant number of hydro-electric power projects and mining ventures have become reality, with even more possible projects in the pipeline. Laos is finally moving forward in what might be described as a confident fashion.
The mobile market in Laos continues to feel the uncertainty that flowed from the so-called Beeline crisis;
The growth in mobile subscribers initially stalled as the regulator imposed a strict policy on pricing;
There has been some recovery in mobile subscriber growth with penetration easing up to 73% coming into 2016;
A further setback for the mobile sector has been a general decline in network performance, a problem being felt across all the mobile networks;
Despite the difficulties in the mobile sector, mobile broadband continues to expand at a rapid rate;
Unitel launched a 4G service in 2015, thereby joining Lao Telecom into the 4G segment;
The government had introduced new internet laws/decrees which were regarded as restrictive and were attracting some criticism internationally;
Laos launches its first satellite, LaoSat-1, in November 2015.
Companies mentioned in this report:
Lao Telecom (LTC), Thaicom, ETL, Unitel, Lao Asia Telecom, Star Telecom, Viettel, Beeline, Tango, Tigo, Millicom, Vimpelcom, Planet Online, Sky Telecom, China-APMT.