Two New Mobile Operators Authorized in Myanmar, Illustrates Asia Pacific Mobile Growth

Telenor and Ooredo (Qatar Telecom) each have won new mobile licenses in Myanmar, competing against existing providers Myanmar Posts and Telecommunications (MPT) and Yatanarpon Teleport Co.

The awards double the number of mobile service providers in Myanmar and are part of a government plan to dramatically boost mobile phone penetration from the current level of nine percent up to levels more typical of other South Asia nations.

In some ways, the Myanmar move is part of a broader trend, namely the emergence of the Asia Pacific region as the biggest communications market on the planet, measured in terms of subscribers, with the fastest growth rates.

Since the mid-2000s, it has been clear that the Asia-Pacific region will feature the greatest single concentration of communications customers and revenue mass of any region in the world, over the coming years.

So any supplier with ambitions to grow globally has to succeed in the Asia-Pacific region. That is a bit of a change from where growth drivers have been seen for much of the past decade.

Asia already by the mid-2000s was home to almost half the world’s fixed telephone subscribers. It had 42 percent of the world’s Internet users, and with 1.4 billion mobile cellular subscribers, it also had the largest mobile phone market share, according to the International Telecommunications Union.

By mid-2008, China and India alone had over 600 and 280 million mobile cellular subscribers, respectively, representing close to a quarter of the world’s total.

The Asia-Pacific region was the world’s largest broadband market with a 39 percent share of the world’s total at the end of 2007.

Telecoms retail revenue in the emerging Asia–Pacific (APAC) region was predicted to grow at a compound annual growth rate (CAGR) of seven percent between 2011 and 2016, according to Analysys Mason.

Both new service providers must build networks providing a minimum of 75 percent geographic coverage for each region and state, for voice services, five years after the effective licence date.

France Telecom (Orange) and Marubeni Corporation, bidding together, was selected as the alternate licensee, should Telenor or Ooredo not meet the requirements.

The license awards came as Myanmar’s Parliament unanimously voted to delay the process, in view of a proposed bill to revise the country’s telecommunications law, including a provision requiring all applicants to have local partners.

The new telecom bill would require all foreign companies bidding or operating in Myanmar to have a local partner.

Apparently, none of the winning bidders, or the The Orange-Marubeni consortium, have local partners.

Myo Swe, the member of parliament who proposed the vote, said the "industry risked being monopolized" if the winners were announced before a telecommunications law was in place.

Myanmar, with 60 million people, has mobile penetration of less than nine percent.

The 15-year wireless licenses take effect in September 2013 and would represent the largest foreign investment in Myanmar since a semi-elected government took power in 2011, ending decades of military rule.

In a way reminiscent of the 1980s cable franchising wars in the United States, applicants were campaigning for themselves across Myanmar, especially in the commercial capital of Yangon, the Wall Street Journal reports.

SingTel ads appeared on phone booths in Yangon while billboard ads appeared elsewhere.

Digicel was confident enough to have already begun hiring local staff in country.

Regulators Can Set Stage for Mobile Innovation, GSMA Argues

The crucial and strategic requirement for robust wireless, mobile or broadband economic, social and financial results at any given time will vary. Sometimes compelling applications are key. At other times a breakthrough device is the most-important enabler. At other times access to investment capital is the gating factor.

At times viable business models need to be developed, and consumer demand always is ultimately decisive.

But at other times, regulators must act first, before any of the other principal challenges can be tackled. That always is the case for services using spectrum, whether non-licensed, such as Wi-Fi or TV white spaces, or licensed services such as mobile services.

And that is a point the GSM Association now makes. To spur further advances in mobile services, “there is a need for creating a transparent and stable regulatory regime that engages all stakeholders in policy making,” the GSMA now argues.

In other words, stakeholders need stability so they can make long-term investments.

That also means more clarity about license renewals. Incumbents obviously want a presumption of renewal, rather than having to face new rounds of auctions.

“There is a need to create a robust spectrum management approach,” GSMA argues. That would include spectrum availability and pricing, as well as the ability to trade or share spectrum, among other foundational elements.

GSMA also wants timely release of spectrum and release in larger blocks. As you might expect, GSMA prefers the larger blocks because that allows providers to amass contiguous blocks of spectrum, and also reduces operator spectrum licensing cost.

As you would expect, the GSMA also argues the importance of “regulatory costs of doing business.”  GSMA argues taxes should be aligned to global benchmarks and should not have undue effect on demand (“sector specific taxes,” for example).

GSMA also argues that regulators “need to revisit commitments to the Universal Service

Obligation Fund (USOF),” in part because they may not be needed as much as in the past, and also because of “unprecedented” service provider margin pressure.

GSMA also argues that in the Asia-Pacific region, for example, regulators across the region should harmonize frequency plans for new spectrum, such as that to be created by the switch to digital television, which will free up spectrum across the region.

GSMA supports a  2x45 MHz band plan in the 698-806 MHz range, as a majority of countries already have committed to doing so.

Asia Will Lead M2M Deployments and Revenue by 2020

Asia will by 2020 be the foremost region of the world using machine to machine (M2M) technologies, a study sponsored by the GSM association predicts.

“The mobile industry continues to develop at an unprecedented pace and nowhere is this more evident than in Asia, a region that continues to experience tremendous growth and by 2020 will lead the connected devices and M2M market, both in terms of the number of devices and in terms of revenues,” said Michael O’Hara, Chief Marketing Officer, GSMA.

Machine to machine services will add up to $22 billion in economic productivity in China by reducing traffic congestion and therefore saving time, for example.

In India, M2M will, by 2017, help power the equivalent of 10 million homes by cutting power theft and improving efficiency. India loses 24 percent of the electricity it generates every year, costing the country $17 billion, with power theft accounting for around half of these losses.

Remote monitoring, disease management, and preventive medicine for the elderly could reduce Japan’s healthcare spend by $10 billion in 2017, and much of that benefit will come from M2M-based health care operations.

The Reason for "Mobile First" or "Mobile Mostly"

"Mobile first" or "mobile mostly" have become watchwords for application providers for one very good reason. People are using smart phones and other untethered or mobile devices for a growing percentage of their Internet and application activities.

Looking only at search, some analysts expect mobile search volume to surpass desktop or PC search volume by about 2015. 

Mobile vs. PC Local Search Volumes (BIA/Kelsey Forecast)

The ISP Speed Claim Dilemma

ISPs face marketing issues no different than other providers of goods and services, namely that consumers generally have some expectations about what features and what prices constitute a reasonable offer.

That means every provider wants to appear to have an edge of some sort, and at a minimum, to supply the baseline of features consumers expect.

ISPs have one additional problem, namely that their product is essentially intangible. As with any other intangible product or service, a consumer cannot fully evaluate product claims until after the product is purchased.

But it still is reasonable to argue that most consumers considering the purchase of an Internet access service will evaluate the advertised speed and the advertised price. That means there will always be pressure to advertise the highest possible speeds.

But consumer protection agencies and regulators do not tend to like exaggerated claims. That is why more attention now is focused on how closely ISPs are able to deliver on speed claims. And there might be more work to do on that score in Europe than in the United States.

Actual European Internet access speeds are about 74 percent of advertised speeds during peak hours, a new study sponsored by the European Commission has found. Recent studies by the U.S. Federal Communications Commission have found that U.S. ISPs deliver actual speeds about 96 percent of advertised speeds.

The average download speed across all measured countries was 19.47 Mbps during peak

hours, and this increased slightly to 20.12 Mbps when all hours were considered.

Performance varied by access network technology.

Digital subscriber line services achieved 63 percent of the headline download speed, while cable services managed to achieve 91 percent of headline speeds. Fiber to home or VDSL services delivered 84 percent of headline speeds.

Fiber to home services achieved the fastest speeds in absolute terms, at 41 Mbps. Cable

services achieved 33 Mbps, whilst DSL services delivered 7 Mbps, on average.

In the September 2012 testing period, U.S. ISPs on average delivered 97 percent of advertised download speeds during peak periods, statistically equivalent to the last report, which found that the studied ISPs were able to deliver 96 percent of advertised speeds during peak hours of use, the FCC has reported. Those results were in line with testing conducted in 2011 as well.

On average, during peak periods DSL-based services delivered download speeds that were 85 percent of advertised speeds, cable-based services delivered 99 percent of advertised speeds, fiber-to-the-home services delivered 115 percent of advertised speeds, and satellite delivered 137 percent of advertised speeds, the FCC says.

This compares to July 2012 results showing largely the same performance levels: 84 percent for DSL, 99 percent for cable, and 117 percent for fiber. These results suggest that many ISPs are meeting established engineering goals for their respective technologies.

It isn’t immediately clear why DSL networks in the U.S. market were able to deliver real-world speeds more nearly matching advertised speeds, compared to European DSL networks.

But a reasonable guess is that the gap is explainable almost entirely by ISP marketing claims.

The EC study says two countries did not achieve 50 percent of advertised speed. Those two countries primarily use DSL networks, but more importantly “advertised their services

using only a handful of very high headline speeds.”

Hungarian ISPs delivered actual speeds that were 94 percent of advertised.  DSL services also achieved over 90 percent of advertised speeds. So it appears the difference is the marketing of service, not something inherent in the networks.

Since DSL performance is directly related to loop length, experienced speeds for consumers closer to the central office will increasingly diverge from speeds experienced by consumers further away from the central office.

It makes quite a difference whether the typical speed at 1,000 meters is used as the reference, compared to 5,000 meters.

But loop length is not the only consideration for DSL or other providers. Contention ratios and the degree of sharing also will affect performance. ISPs simply need to market services that reflect all the known limits, if they want to deliver on promised speeds.

But that is the dilemma. A more-realistic set of claims might mean forfeiting an advantage to other providers.

SK Telecom Launches LTE Advanced at 150 Mbps

SK Telecom is launching Long-Term Evolution-Advanced service in South Korea, a move that will about double Internet access speeds over the existing version of LTE SK Telecom now is running.

The new network is theoretically capable of download speeds of 150 Mbps, using the amount of spectrum SK Telecom will have to support the new network.

LTE-Advanced, if enough spectrum is available, can deliver up to 1Gbps of downlink and 500 Mbps of uplink.

SK Telecom’s LTE-Advanced network will pair two blocks 0f 10 MHz to provide a 20 MHz carrier capable of 150 Mbps.In the future, SK Telecom says it will aggregate multiple 20 MHz carriers to achieve download speeds of 300 Mbps or more. To begin with, the service is available in Seoul, 42 other cities in the provinces of Gyeonggi-do and Chungcheong-do, and 103 universities. 

SK Telecom Launches LTE Advanced at 150 Mbps

SK Telecom is launching Long-Term Evolution-Advanced service in South Korea, a move that will about double Internet access speeds over the existing version of LTE SK Telecom now is running.

The new network is theoretically capable of download speeds of 150 Mbps, using the amount of spectrum SK Telecom will have to support the new network.

LTE-Advanced, if enough spectrum is available, can deliver up to 1Gbps of downlink and 500 Mbps of uplink.

SK Telecom’s LTE-Advanced network will pair two blocks 0f 10 MHz to provide a 20 MHz carrier capable of 150 Mbps.In the future, SK Telecom says it will aggregate multiple 20 MHz carriers to achieve download speeds of 300 Mbps or more. To begin with, the service is available in Seoul, 42 other cities in the provinces of Gyeonggi-do and Chungcheong-do, and 103 universities.