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Sri Lanka - Telecoms, Mobile and Broadband

Sri Lanka - Telecoms, Mobile and Broadband

15%+ annual growth for Sri Lanka’s mobile market in 2015

Sri Lanka’s telecommunications sector has had to contend with a developing market in the difficult context of a nearly two-decade-long conflict between the government and separatist Tamil Tiger rebels. With the end of the war came the hope of an enduring peace and a general improvement in the country’s social and economic well-being. This also found the telecom sector well positioned for vigorous growth. A good start has already 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 has also been 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.

There are a range of major initiatives in place that should boost the building of national infrastructure and open the market to more competition. On the regulatory front, Sri Lanka Telecom losing its monopoly in a number of key areas earlier on led the way and since then the market has progressively been opened up to more and more competition.

While mobile penetration has historically been relatively low compared with other more developed Asian markets, it is now catching up, with penetration reaching 115% in 2015. Demand for broadband data services driven by 3G and 4G adoption and increased smartphone penetration should drive reasonably strong growth in the local market moving into 2016 and 2017. The highly competitive mobile market in Sri Lanka had been running with a healthy overall annual growth rate for some years. The market has undoubtedly benefited from its liberalisation and the competition that came with five operators continuing to battle it out for market share. However consolidation in Sri Lanka over the next few years is possible since the market is finding it increasingly difficult to sustain all five operators.

Internet access services in their various forms and associated data services are finally taking off in the country, but coverage and accessibility continue to present challenges. Internet user penetration was estimated at around 30% by 2015. However, the sophistication of the services available is only slowly improving. The early moves to offer broadband internet in the country met with limited success and it seemed that it would be some time before there is a substantial broadband market. However, by 2015 fixed broadband internet services were being supplemented by a rapidly expanding mobile broadband segment. Also during 2015 the availability of e-commerce applications including mobile banking, e-bus ticketing, and mobile points of sale (POS) continued to increase. Demand for broadband data services driven by 3G and 4G adoption and increased smartphone penetration should drive reasonably strong growth in the local market over the next few years.

In the meantime, the government has been promoting such initiatives as the e-Sri Lanka project. It has also established the National Broadband Consultative Committee (NBCC), a special committee appointed to accelerate and promote the availability of affordable high speed broadband internet in the country.

For fixed-line services, after a five-year period of strong growth the subscriber numbers flattened out and then entered into a decline. Considerable uncertainty hangs over this segment of the telecom market. The widespread application of the Wireless Local Loop (WLL) platform was for some time a positive element in this struggling sector. However, even the WLL subscriber numbers are now in decline. There is also large concentration of fixed services in the capital Colombo (penetration of 35%) which makes the national figure look better than it is.

Key developments:

The mobile subscriber base grew strongly during 2014 reaching 22.1 million subscribers.
Dialog Axiata continues to dominate the market with 42% market share.
Dialog Broadband, launched an LTE Advanced pilot network in July 2015.
IPTV services continue to grow strongly from a small base.
The WLL platform which initially drove growth in fixed subscribers is now in decline.
By 2015 fixed broadband internet services were being supplemented by a rapidly expanding mobile broadband segment.
Potential regulatory inhibitors to the existing market players include the super gains tax and the prepaid card levy imposed by the new government.
Sri Lanka’s global connectivity will be boosted by the proposed SEA-ME-WE 5 submarine cable.
Fixed internet subscribers continue to grow but at a slow rate of under 4% per annum.
The government was rolling out 1,000 WiFi hotspots in 2015.
The Information and Communications Technology Agency (ICTA) has launched the Lanka Government Cloud (LGC);
SLT claimed the launch of the first FttH network in Sri Lanka in 2015;
Also in 2015 SLT launched the first nationwide DWDM fibre-optic backbone transmission network
The second phase of the ‘e-Sri Lanka’ project was approved by government.

Companies mentioned in this report:

SLT, Lanka Bell, Suntel, Dialog Axiata (formerly Dialog Telekom), Etisalat Sri Lanka (formerly Tigo), Mobitel, Hutchison Lanka, Bharti Airtel Lanka, Data Access; MTN Networks; SLTNet, SkyNet, Suntel, Lanka Bell, BellNet, Wishya Online (Pvt) Ltd, ITMIN Ltd, Eureka Online (Pvt) Ltd.


  • EXECUTIVE SUMMARY
  • KEY STATISTICS
    • Table Country statistics Sri Lanka - 2015
    • Table Telephone network statistics - June 2015
    • Table Internet user statistics - 2014
    • Table Mobile statistics - June 2015
    • Table National telecommunications authorities
    • COUNTRY OVERVIEW
      • Background
      • Economy
        • Table Sri Lanka's real GDP growth rate - 2006 - 2016
  • TELECOMMUNICATIONS MARKET
    • OVERVIEW
      • Table National network status - 2014
    • BACKGROUND TO DEVELOPMENT
  • REGULATORY ENVIRONMENT
    • TELECOMMUNICATIONS REGULATORY COMMISSION (TRC)
    • NATIONAL POLICY ON TELECOMMUNICATIONS
      • Adoption in 1998
      • The years 2001-2005
      • Proposed Ten Year Development Plan (2006-2016)
    • HISTORICAL OVERVIEW
      • Convergence Act
    • DEREGULATION
      • Background
      • EGO Licences - International licences
      • International Traffic Bypass Control rules
    • LICENCES
      • Table Number of telecom operator licences by category - 2014
    • PRIVATISATION - BACKGROUND
      • SLT
  • FIXED NETWORK MARKET
    • OVERVIEW OF OPERATORS
      • Table Fixed-line operators and subscribers - 2011 - 2014
      • Table Telecommunications system operator licensees
    • SLT (FORMERLY SRI LANKA TELECOM)
      • Overview
      • Statistics
        • Table SLT fixed-line subscribers and market share - 1999 - 2014
        • Table SLT fixed-line subscribers - wireline and WLL - 2005 - 2014
        • Table SLT (Sky Network) broadband subscribers - 2009 - 2014
      • Background
      • Financials
      • Privatisation and ownership of SLT
        • Table Major shareholders in SLT - December 2014
      • Mobitel
      • IPTV
      • WLL
      • WiFi
      • National and international networks
    • SUNTEL
      • Overview
      • Background
        • Table Historical - Suntel subscribers - 1999 - 2012
      • Acquisition by Dialog Axiata
    • LANKA BELL
      • Table Lanka Bell fixed-line subscribers - 1999 - 2014
    • DIALOG BROADBAND NETWORKS (DBN)
      • Table DBN fixed-line subscribers - 2008 - 2014
    • OTHER OPERATORS
  • TELECOMMUNICATIONS INFRASTRUCTURE
    • OVERVIEW
    • NATIONAL TELECOM NETWORK
    • FIXED-LINE STATISTICS
      • Table Historical - fixed-line subscribers, annual change and teledensity - 1995 - 2005
      • Table Fixed-lines subscribers, annual change and teledensity - 2006 - 2015
      • Table Fixed subscribers - wireline and wireless (WLL) - 2009 - 2015
    • FORECASTS - FIXED-LINE MARKET - 2015; 2017; 2020
      • Scenario forecasts
        • Table Forecast fixed line subscribers and penetration rate - 2015; 2017; 2020
    • INFRASTRUCTURE DEVELOPMENT
      • Background
      • Wireless Local Loop (WLL)
        • Table Historical -WLL subscribers - 1996 - 2005
        • Table WLL subscribers - 2006 - 2015
      • Fibre optic networks
      • National Backbone Network (NBN) - background
      • Payphones
      • Numbering plan
      • Internet Protocol (IP) networks
    • INTERNATIONAL INFRASTRUCTURE
      • Background
      • Developments
  • INTERNET MARKET
    • OVERVIEW
    • INTERNET AND BROADBAND STATISTICS
      • Table Internet users, annual change and penetration - 1996 - 2015
      • Table Fixed internet subscribers - 1994 - 2014
      • Table Computer penetration by household - 2005 - 2015
      • Table International internet bandwidth - 1998 - 2015
      • Table Fixed broadband subscribers and penetration - 2002 - 2015
      • Table DSL subscribers - 2003 - 2013
      • Table Mobile broadband subscribers - 2009 - 2015
      • Table Broadband subscribers and households - 2014
      • Table Broadband subscribers - fixed and mobile - 2010 - 2014
    • FORECASTS - INTERNET SERVICES - 2015; 2017; 2020
      • Scenario forecasts
        • Table Forecast fixed broadband internet subscribers and penetration - 2015; 2017; 2020
    • INTERNET EXCHANGE
    • ISP MARKET
      • Overview
        • Table Licensed Internet Service Providers (ISPs)
        • Table Licensed Data Communications Service Providers (Facility-based)
        • Table Licensed Data Communications Service Providers (Non-Facility based)
      • SLTNet
        • Table SLT's DSL broadband subscribers - 2005 - 2014
      • Suntel wOw
      • BellNet
      • Wishya Online (Pvt) Ltd
      • ITMIN Ltd
      • Eureka Online (Pvt) Ltd
  • BROADBAND MARKET
    • OVERVIEW
      • National Broadband Consultative Committee (NBCC)
      • Broadband monitoring
    • DIGITAL SUBSCRIBER LINE (DSL)
    • WIRELESS BROADBAND/WIMAX
    • WIFI
    • FIBRE TO THE BUILDING (FTTB)
    • INTERNET PROTOCOL TV (IPTV)
  • DIGITAL MEDIA
    • MARKET OVERVIEW
      • Table Key broadcasting statistics - 2014
    • REGULATORY ENVIRONMENT
    • DIGITAL TERRESTRIAL TV (DTT)
    • INTERNET PROTOCOL TV (IPTV)
      • Table SLT's PeoTV subscribers - 2009 - 2014
    • CABLE AND PAY TV
      • Comet Cable
      • Dialog TV (DTV)
        • Table DTV's DTH subscribers - 2008 - 2015
      • TV & Radio Network (Pvt) Ltd
    • FREE-TO-AIR (FTA) TV
  • DIGITAL ECONOMY
    • E-LEARNING
      • School Net project
      • Connect To Learn Project in Kandy
    • LANKA GOVERNMENT CLOUD (LGC)
    • E-SRI LANKA
  • MOBILE COMMUNICATIONS
    • OVERVIEW OF SRI LANKA'S MOBILE MARKET
    • MOBILE STATISTICS
      • Table Mobile subscribers, annual change and penetration - 1995 - 2005
      • Table Mobile subscribers, annual change and penetration - 2006 - 2015
      • Table Mobile operator market share based on subscribers - 2014
      • Table Mobile operators, subscribers and annual change - 2014
      • Table Mobile broadband subscribers - 2009 - 2015
    • FORECASTS - MOBILE SERVICES - 2015; 2017; 2020
      • Scenario forecasts
        • Table Forecast mobile subscribers and penetration rate - 2015; 2017; 2020
    • THIRD GENERATION (3G) MOBILE
      • Background
      • Licences and service launch
        • Table 3G mobile operators and subscribers - 2009; 2013
      • Development of 3G
    • FOURTH GENERATION (4G) / LONG TERM EVOLUTION (LTE)
    • M-BANKING
    • MAJOR MOBILE OPERATORS
      • Dialog Axiata (formerly Dialog Telekom)
        • Table Dialog Axiata subscribers and market share - 2004 - 2014
        • Table Dialog Axiata prepaid subscribers - 2004 - 2014
        • Table Dialog Axiata ARPU - postpaid, prepaid and blended - 2007 - 2015
        • Table Dialog's smartphone penetration - 2014 - 2015
        • Table Dialog Axiata: 3G mobile subscribers - 2012 - 2013
      • Mobitel
        • Table Mobitel subscribers and market share - 2004 - 2014
        • Table Mobitel: 3G mobile subscribers - 2012 - 2013
      • Etisalat Sri Lanka
        • Table Etisalat Sri Lanka subscribers - 2004 - 2014
        • Table Etisalat: 3G mobile subscribers - 2012 - 2013
      • Hutchison Lanka
        • Table Hutchison Lanka subscribers and market share - 2006 - 2014
        • Table Hutchison: 3G mobile subscribers - 2012 - 2013
      • Bharti Airtel Lanka
        • Table Bharti Airtel Lanka subscribers and market share - 2009 - 2014
        • Table Bharti Airtel: 3G mobile subscribers - 2012 - 2013
      • Satellite mobile

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