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Sri Lanka - Telecoms, Mobile, Broadband and Forecasts


Attention: There is an updated edition available for this report.

Sri Lanka’s continues its post-conflict recovery, pushing towards a connected, online societyWith the end of the civil war in 2009 Sri Lanka entered what is referred to as a ‘post-conflict’ phase. By 2012 there were positive signs of a general improvement in the country’s social and economic well-being. And the telecom sector in particular is starting to build a fresh momentum.

In May 2010 President Rajapaksa appointed the Lessons Learnt and Reconciliation Commission (LLRC) in 2010, a commission designed to help prevent a recurrence of conflict and to look at restitution. The final LLRC report was tabled in Sri Lanka’s Parliament in December 2011. It recommended ways of advancing reconciliation and reconstruction, including a reduction in the presence of security forces in the north, care of internally displaced persons and enhanced media freedoms. The government also implemented a National Human Rights Action Plan (NHRAP). In March 2012, however, the UN Human Rights Council adopted a resolution calling on Sri Lanka to address alleged violations of international law, to implement the LLRC report’s constructive recommendations, and to present a comprehensive action plan on implementing the recommendations. The Sri Lankan Government released a National Action Plan to implement the recommendations of the LLRC report in July 2012 and has proceeded to implement this plan.

In the meantime, over the past few years the Sri Lankan economy has rebounded from the difficult state it was experiencing in 2009. The country had been hit by a balance of payments crisis in that year and needed a US$2.6 billion IMF loan to bail it out. Since then, however, the US$59 billion economy has been reporting strong economic growth - over 8% in 2011 - and the unemployment rate had hit a record low. The IMF has forecast growth of close to 7% over the 2012/2013 period.

The generally improving market environment has seen the country’s telecom sector well positioned for continuing vigorous growth. The already modern and progressive telecommunications sector is certainly high on the list of priorities for further expansion and development. This also fits well with the government’s wider agenda for national development.

A good start has been made on expansion and provision of infrastructure that is capable of providing a sophisticated level of telecommunications service to the population throughout the whole country. Extending infrastructure into the North and Eastern provinces, those parts of the country most affected by the long-running war is being given high priority. It is well recognised that the growth and development of any country’s telecom sector is necessary to provide, among other things, an impetus for national economic activity. Nevertheless, much still needs to be done to complete the build-out of the necessary national infrastructure.

Fixed-line teledensity was a healthy 17% by 2012. In 2006 teledensity stood at a relatively meagre figure of less than 6%. It had reached 3.5million (17%) by 2008. Since then growth has flattened out. A recent small boost to the numbers was aided by the widespread application of the Wireless Local Loop (WLL) platform. There is a large concentration of fixed services in the capital Colombo which has a penetration of 35%.

In the meantime, the country’s mobile telephone services have continued on a positive growth path. As an effective and efficient alternative to the fixed-line networks, with their earlier problems in meeting the demand for telephone services, the mobile phone quickly became a popular and essential service. The Sri Lankan mobile market was still growing at an annual rate of around 50% in 2009 in as it headed towards the 60% penetration mark. However, since then subscriber growth has moderated to less than 10% per annum. The country’s four competing mobile operators – Dialog Axiata, Mobitel, Etisalat Sri Lanka and Hutchison Lanka – have been joined by a fifth operator, Bharti Airtel Lanka, adding vigour to an already highly competitive market.

The development of the internet remains of particular concern for Sri Lanka. In a country whose population is increasingly undeniably internet savvy and the government rhetoric positively supports the nation going online, the estimated user penetration stood at 15% coming into 2012. Despite signs of an enthusiastic user market, coverage and accessibility have continued to be limited and the sophistication of the available services generally low. The level of broadband access has been of particular concern. By early 2012, however, fixed broadband internet services in this country were being supplemented by a rapidly expanding mobile broadband segment, delivering an overall broadband penetration of over 4%. A promising sign on the way to wider adoption of the internet was the creation by the government in 2010 of the National Broadband Consultative Committee (NBCC).

Market highlights:

Sri Lanka’s mobile market had reached over 19 million subscribers by mid-2012, for a mobile penetration of 91%.
This meant that the number of mobile subscribers had increased eightfold in just six years.
The leading mobile operators have commenced trials of Fourth Generation (4G) technologies with a view to launching by end-2012.
The country’s fixed-line market underwent a sustained period of healthy growth, reaching a subscriber penetration of 17% by 2012, but growth has levelled out in the last few years.
Fixed-line expansion has been boosted by the extensive application of CDMA-based WLL technology; WLL services comprised around three quarters of the total fixed line subscriber base by 2012.
The country’s internet sector remained underdeveloped, with the take up rate of broadband services being especially low; there were however signs that this was starting to change, especially with the surge in mobile broadband services.
Fixed broadband penetration (as a percentage of population) was still less than 2% in early 2012.
The government having established the National Broadband Consultative Committee (NBCC) in 2010, there was little evidence of it having any great impact to date.

Sri Lanka - key telecom parameters – 2011 - 2012
Category | 2011 | 2012 (e)
Fixed-line services: | |
Total number of subscribers | 3.61 million | 3.60 million
Internet: | |
Total number of subscribers (fixed) | 509,000 | 600,000
Mobile services: | |
Total number of subscribers | 18.3 million | 20.0 million
(Source: BuddeComm)


1. Key Statistics and Country Overview
1.1 Key Statistics
1.2 Country Overview
1.2.1 Background
1.2.2 Economy
2. Telecommunications Market
2.1 Overview
2.2 World Bank-Dialog Axiata training initiative
2.3 Background to development
3. Regulatory Environment
3.1 Telecommunications Regulatory Commission (TRC)
3.2 National Policy on Telecommunications
3.2.1 Adoption in 1998
3.2.2 The years 2001-2005
3.2.3 Proposed Ten Year Development Plan (2006-2016)
3.3 Deregulation
3.3.1 Background
3.3.2 EGO Licences – International licences
3.3.3 International Traffic Bypass Control rules
3.4 Licences
3.5 Regulatory developments
3.6 Privatisation
3.6.1 SLT
4. Major Fixed Network Operators
4.1 Overview of Operators
4.2 SLT (Formerly Sri Lanka Telecom)
4.2.1 Company overview
4.2.2 Financial overview 2009-2011
4.2.3 Privatisation and ownership of SLT
4.2.4 Mobitel
4.2.5 IPTV
4.2.6 WLL
4.2.7 National and international networks
4.3 Suntel
4.3.1 Overview
4.3.2 Network roll-out and operations
4.3.3 Acquisition by Dialog Axiata
4.4 Lanka Bell
4.5 Dialog Broadband Networks (DBN)
4.6 Other Operators
5. Telecommunications Infrastructure
5.1 Overview
5.2 National telecom network
5.3 Infrastructure development
5.3.1 STL’s role
5.3.2 Wireless Local Loop (WLL)
5.3.3 Fibre optic networks
5.3.4 National Backbone Network (NBN)
5.3.5 Payphones
5.3.6 Numbering plan
5.3.7 Internet Protocol (IP) networks
5.4 International infrastructure
6. Internet and ISP Market
6.1 Overview
6.2 Internet statistics
6.3 Internet control and censorship
6.4 Internet exchange
6.5 Public internet access
6.6 School Net project
6.7 Lanka Government Cloud (LGC)
6.8 ISP market
6.8.1 SLTNet
6.8.2 Suntel wOw
6.8.3 BellNet
6.8.4 Wishya Online (Pvt) Ltd
6.8.5 ITMIN Ltd
6.8.6 Eureka Online (Pvt) Ltd
7. Broadband Market
7.1 Overview
7.1.1 National Broadband Consultative Committee (NBCC)
7.1.2 Broadband monitoring
7.2 Broadband statistics
7.3 Digital Subscriber Line (DSL)
7.4 Wireless broadband/WiMAX
7.5 Fibre to the Building (FttB)
7.6 Internet Protocol TV (IPTV)
8. Digital Media
8.1 Broadcasting Market Overview
8.2 Regulatory environment
8.3 Internet Protocol TV (IPTV)
8.4 Cable and pay TV
8.4.1 Comet Cable
8.4.2 Dialog TV (DTV)
8.4.3 TV & Radio Network (Pvt) Ltd
8.5 Free-to-Air (FTA) TV
9. Digital Economy
9.1 E-commerce
9.2 E-government
10. Mobile Communications
10.1 Overview of Sri Lanka’s mobile market
10.2 Mobile statistics
10.3 Third Generation (3G) mobile
10.3.1 Background
10.3.2 Licences and service launch
10.3.3 Development of 3G
10.4 Fourth Generation (4G) / Long Term Evolution (LTE)
10.5 M-banking
10.6 Major mobile operators
10.6.1 Dialog Axiata (formerly Dialog Telekom)
10.6.2 Mobitel
10.6.3 Etisalat Sri Lanka
10.6.4 Hutchison Lanka
10.6.5 Bharti Airtel Lanka
10.6.6 Satellite mobile
11. Forecasts
11.1 Forecasts – fixed-line market – 2015; 2020
11.2 Forecasts – Internet services – 2015; 2020
11.3 Forecasts – mobile services – 2015; 2020
11.4 Notes on forecasting
12. Glossary of Abbreviations
List of Tables, Charts and Exhibits
Table 1 – Country statistics Sri Lanka – 2012
Table 2 – Telephone network statistics – June 2012
Table 3 – Internet user statistics – June 2012
Table 4 – Mobile statistics – June 2012
Table 5 – National telecommunications authorities
Table 6 – Sri Lanka’s real GDP growth rate – 2006 - 2013
Table 7 – National network status – June 2012
Table 8 – Number of telecom operator licences by category – June 2012
Table 9 – Fixed-line operators and subscribers – 2008; 2010 - 2011
Table 10 – SLT fixed-line subscribers and market share – 1999 - 2011
Table 11 – SLT fixed-line subscribers – wireline and WLL – 2005 - 2011
Table 12 – SLT (Sky Network) broadband subscribers – 2009 - 2012
Table 13 –Suntel subscribers – 1999 - 2011
Table 14 – Lanka Bell subscribers – 1999 - 2011
Table 15 – Fixed lines in service, annual change and teledensity – 1995 - 2012
Table 16 – Fixed subscribers – wireline and WLL – 2009 - 2012
Table 17 – WLL subscribers – 1996 - 2012
Table 18 – Internet users, annual change and penetration – 1996 - 2012
Table 19 – Internet subscribers – 1994 - 2012
Table 20 – Computer penetration by household – 2005 - 2011
Table 21 – International Internet bandwidth – 1998 - 2012
Table 22 – SLT’s DSL broadband subscribers – 2005 - 2011
Table 23 – Fixed broadband subscribers – 2002 - 2012
Table 24 – DSL subscribers – 2003 - 2012
Table 25 – Mobile broadband subscribers – 2009 - 2012
Table 26 – Broadband subscribers – fixed and mobile – 2010 - 2011
Table 27 – Broadband subscribers and households – 2011
Table 28 – Key broadcasting statistics – 2011
Table 29 – SLT’s PeoTV subscribers – 2009 - 2012
Table 30 – DTV’s DTH subscribers – 2008 - 2012
Table 31 – Mobile subscribers, annual change and penetration – 1995 - 2012
Table 32 – Mobile operator market share based on subscribers – 2011
Table 33 – Mobile operators, subscribers and annual change – 2011
Table 34 – Mobile broadband subscribers – 2009 - 2012
Table 35 – 3G mobile operators and subscribers – March 2009
Table 36 – Dialog Axiata subscribers and market share – 2004 - 2012
Table 37 – Dialog Axiata prepaid subscribers – 2004 - 2012
Table 38 – Dialog Axiata ARPU – postpaid, prepaid and blended – 2007 - 2012
Table 39 – Mobitel subscribers and market share – 2004 - 2011
Table 40 – Etisalat Sri Lanka subscribers – 2004 - 2011
Table 41 – Hutchison Lanka subscribers and market share – 2006 - 2011
Table 42 – Bharti Airtel Lanka subscribers and market share – 2009 - 2011
Table 43 – Forecast fixed line subscribers and penetration rate – 2015; 2020
Table 44 – Forecast internet subscribers and penetration rate – 2015; 2020
Table 45 – Forecast mobile subscribers and penetration rate – 2015; 2020
Chart 1 - Fixed-line operators and subscribers - 2008; 2010 - 2011
Chart 2 - SLT fixed-line subscribers and market share – 2003 - 2011
Chart 3 - SLT fixed-line subscribers - wireline and WLL – 2005 - 2011
Chart 4 – Fixed lines in service and annual change – 1996 - 2012
Chart 5 – Fixed subscribers – wireline and WLL – 2009 - 2012
Chart 6 – WLL subscribers – 2000 - 2012
Chart 7 – Internet users – 1996 - 2012
Chart 8 – Internet subscribers – 1994 - 2012
Chart 9 – International Internet bandwidth – 2004 - 2012
Chart 10 – SLT’s DSL broadband subscribers – 2005 - 2011
Chart 11 – Fixed broadband subscribers – 2002 - 2012
Chart 12 – DSL subscribers – 2003 - 2012
Chart 13 – Mobile subscribers, annual change and penetration – 1995 - 2012
Chart 14 – Mobile operator market share - 2011
Chart 15 – Mobile broadband subscribers – 2009 - 2012
Chart 16 – Dialog Axiata subscribers and market share – 2004 - 2012
Chart 17 – Dialog Axiata prepaid subscribers – 2004 - 2012
Chart 18 – Mobitel subscribers and market share – 2004 - 2011
Chart 19 – Estisalat Sri Lanka subscribers – 2004 - 2011
Chart 20 – Hutchison Lanka subscribers and market share – 2006 - 2011
Chart 21 – Bharti Airtel Lanka subscribers and market share – 2009 - 2011
Exhibit 1 – Telecommunications system operator licensees
Exhibit 2 – Major shareholders in SLT – December 2011
Exhibit 3 – Licensed Internet Service Providers (ISPs) – 2010
Exhibit 4 – Licensed Data Communications Service Providers (Facility-based) – February 2011
Exhibit 5 – Licensed Data Communications Service Providers (Non-Facility based) – February 2011
Exhibit 6 – Special rural subscriber tariffs

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