Myanmar Industry Overview

Telecommunication services & equipments

Overview

Myanmar’s telecommunication industry is one of the under developed ones in the world and in south east Asia. The first wireless network was launched in 1999 based on Code Division Multiple Access (CDMA) Technology. Then Global System for Mobile communication (GSM) was introduced in 2002 and then 3G network. For many years, Myanmar Post and Telecommunication was the only GSM mobile operator in the country that serves 2G and 3G networks for Myanmar. The entry of two foreign telecoms operators, Qatar’s Ooredoo and Norway’s Telenor, in 2015 has changed this industry tremendously. In 2016, the government has even approved the fourth and final telecom operator, Vietel. As affordable mobile services are now becoming widely available from the four telecoms, the market is changing and mobile penetration has risen from less than 3% in 2011 to over 70% in 2015. Since 2013 Myanmar has witnessed a rise in tele- density from around 10% to over 40%, over USD 2.8 billion in foreign investment, and the creation of an estimated 250,000 jobs over the next 15 years.

Opportunities and Barriers

Since the final and fourth telecom license has been award, investors can take other untapped opportunities. The Ministry of Communications and Information Technology (currently changed to Ministry of Transportation and Communication) is carrying out a first ever Masterplan with the visions to connect the people of Myanmar nationally and globally, using mobile, fixed and satellite technologies to connect over 90% of the population within 2020 to the internet with 50% having access to high-speed internet services of at least 7.2 MBps. Therefore, prospective investors are encouraged to apply for the following licenses;

Telecommunication Services License

There are 4 types of telecom licenses and The NSF (1) is the most comprehensive form of telecom license Myanmar has currently and it allows the license holders to provide allowed services and to hold a network. As of June 2016, there are 35 NFS(I) license holders or telecommunication service license holder’s companies. The licenses differ based on the types of activities that they carry out, the application procedure and timeframe and license period and renewal.

Spectrum Band License

In the next 5 years, according to the Post and Telecommunications Department (PTD), some unassigned and bands will be potentially made available for assignment for those investors who are interested in bidding for the auctions of spectrum license. The list includes unassigned portions of the 850/900 MHz and 2100 MHz bands, unassigned portions of the 2600 MHz band, 700 MHz, 1800 MHz and 2300 MHz

Mobile Financial Services License

Starting from March 2016, the Central Bank of Myanmar issued regulations on mobile financial services that the market place and investors have been awaiting. Only mobile network operators and registered non-bank financial institutions with the purpose of solely providing such services can apply a MFS license. Perks of the MFS license include operations through a network of agents and the mechanism of such network is monitored by the CBM. The types of transactions allowed under this license include a broad scope of domestic transactions although international ones would only be permitted with CBM approval. Operator with this license do not require MIC permit to carry on business but the kind of operator that is considering to make a significant capital investment in Myanmar should apply for MIC permit because of the potential tax incentives given along with the MIC permit.

Telecommunications Equipment License

These licensed are given by MTC and PTD. Anyone meeting the qualification criteria set out in the license. The equipment required to have for this type of license are satellite equipment, radar equipment and HF radio equipment

The Infrastructure

Myanmar telecommunications infrastructure is significantly changing, especially with the development of new telecoms being competitive with each other. The Ministry of Transportation and Communication has been cooperating with Japan to develop the country’s Emergency Communications Networks Improvement Plan in May 2013. Current primary features of the communications infrastructure include high speed, high capacity core optical transmission network capable of transmitting 30Gbps between Yangon, Nay Pyi Taw and Mandalay, LTE communications, fixed-line telephones and optical transmission networks capable of 10Gbps Internet transmissions within each city and installation of international internet connection points in Yangon and Nay Pyi Taw.

Legal & Regulatory Framework

In the past, The Myanmar Telegraph Act (1885), The Myanmar Wireless Telegraphy Act (1934), The Computer Science Development Law (1996) and The Electronic Transactions Law (2004) have existed as the Myanmar IT laws for a long time. In 2013, the Ministry of Communications, Posts, enacted Telecommunications Law and Telegraphs (currently known as Ministry of Transportation and Communications) and The Myanmar Telegraph Act and The Myanmar Wireless Telegraphy Act were repealed as well. This recently enacted Telecommunications Law has the scopes of services including the provision of operation of infrastructure or network facilities, the provision of service for transmission and reception of information and the provision of services by the way of transmitting and receiving. Competition policy is an essence of telecommunications law and a policy framework to establish, foster and maintain competition is critical to the delivery of benefits expected and demanded by consumers.

Allowed Types of Investments

Investment businesses permitted with recommendation of Ministry of Transportation and Communications are communication services, Production and distribution of satellite communication devices, production and distribution of radar communication devices and related tools, production and distribution of radio communication devices and production and domestic distribution of mobile handset.

Sources

  1. Ericsson Mobility Report, June 2016
  2. VDB Loi Telecom Sector Myanmar Brief, 2016

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