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2008 Asia - Telecoms, Mobile & Broadband In Central Asia

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  • 2008 Asia - Telecoms, Mobile & Broadband In Central Asia

    2008 ASIA - TELECOMS, MOBILE & BROADBAND IN CENTRAL ASIA

    Live-PR.com (Pressemitteilung)
    02.07.2009 16:15:02 2008

    Asia - Telecoms, Mobile & Broadband in Central Asia - a new market
    research report on companiesandmarkets.com

    (live-PR.com) - www.companiesandmarkets.com/Summary-Market-Repor ..

    This annual publication looks at 11 of the developing telecom markets
    of Asia: Armenia, Azerbaijan, Bhutan, Georgia, Kazakhstan, Kyrgyzstan,
    Mongolia, Nepal, Tajikistan, Turkmenistan and Uzbekistan.

    Armenia

    Armenia's telecom sector is small but growing. With over 600,000
    fixed-line subscribers for a population of around 3.5 million, the
    level of investment in infrastructure and new services has begun to
    increase. There are, however,

    major structural issues to be addressed in the sector. In 2004,
    amid growing dissatisfaction over the performance of the telecoms
    network, the government reached a compromise with national telecom
    provider, ArmenTel, ending its exclusive rights as a service provider
    in exchange for various other concessions, including that only one
    alternative mobile operator would be allowed to operate in Armenia
    until 2009. ArmenTel was allowed to retain sole rights to Internet
    telephony and the use of fibre optic cables. Previously, it had been
    granted exclusive rights to provide all telecom services in Armenia
    until 2013 (apart from data). The mobile market grew by around 75%
    in 2007, with K-Telecom, Armenia's second mobile operator having
    a big impact on the market. Plans to award a third mobile operator
    licence were announced in late 2007.

    Azerbaijan Azerbaijan's GDP growth was running at an estimated
    30% coming into 2008, largely due to a rapid increase in capital
    investment. Much of this is foreign capital and has mainly
    been directed towards major oil and gas developments. On the
    telecommunications front, the country has been making steady progress
    in developing its telecom sector, but it still faces numerous problems,
    including poor quality infrastructure; still only around half the
    country's telephone lines are digital. The monopoly held by the
    Ministry of Communications remains problematic. As well as being
    a commercial operator through its role in incumbent AzTelecom, the
    ministry is both policy-maker and regulator for the telecoms sector.

    Bhutan Bhutan, which for a long time preferred to remain isolated
    from the world, has very recently started to improve its telecoms
    capability. The tiny country proceeded to invest heavily - to the
    tune of around US$27 million - in telecom infrastructure between
    1996 and 2002, providing a modern fixed-line network. To do so it
    has had to overcome its mountainous landscape. A mobile service
    launched in late 2003 by Bhutan Telecom had signed up more than
    150,000 subscribers by end-2007, equivalent to about 7% penetration. A
    second national mobile licence was awarded in November 2006 to local
    industrial conglomerate, the Tashi Group. Tashi launched its mobile
    operations in April 2008. Accurate statistical information on Bhutan
    is especially difficult to obtain. In the meantime, Bhutan has moved
    towards adopting a democratic system of government, the King having
    been actively involved in this process.

    Georgia There has been an upward trend in Georgia's telecom market
    over the past few years, with rising revenues and increased investment
    in infrastructure. Although steadily improving, Georgia's telecom
    infrastructure remains outmoded and inadequate as a result of gradual
    under-investment over decades. Mobile telephone systems have become
    increasingly important because the fixed-line infrastructure is
    outdated and a mobile phone represents the only effective means of
    communication. MagtiCom was awarded the country's first 3G licence
    in 2005. Then, in a significant move in 2006, the regulator awarded
    another 3G licence. This was followed by a third licence going
    to Telecom Invest Georgia. In the four years to end-2007, mobile
    penetration increased fourfold to reach a remarkable 50% penetration
    in what was a truly booming market.

    Kazakhstan Kazakhstan's telecoms market has been growing on a broad
    front. One of the few central Asian countries that has a substantial
    fixed-line network (almost 20% penetration), the dynamic nature of
    the market is seeing the rapid introduction of new infrastructure and
    the upgrade of old equipment. Legislation enacted in 2004 started the
    liberalisation process and ended Kazakhtelecom's sector monopoly. By
    April 2005, four companies had been licensed to provide international
    and long-distance services and by year-end, over 1,000 licences had
    been issued to provide a range of telecom services. Rapid development
    in the mobile market has seen mobile penetration surge to over
    75% in early 2008. By contrast, Internet penetration remains low,
    however. Supported by a strong economy and a GDP per capita estimated
    at nearly US$9,000 in 2008, further vigorous expansion of the telecom
    sector in Kazakhstan looks highly likely.

    Kyrgyzstan Kyrgyzstan has progressed further and faster than other
    Commonwealth of Independent States to liberalise its economy. It was
    the first Central Asian Republic to join the WTO, despite being one
    of the least developed countries in the region. Even though much has
    been done to modernise its telecom network, a number of key obstacles
    including geographical conditions, a high incidence of poverty and
    a still developing legal and regulatory framework limit Kyrgystan's
    ability to expand its telecom operations. The telecom market has
    been opened up to both foreign and domestic investors; an independent
    regulator has been established to oversee the sector. Not surprisingly
    there is a high level of interest among foreign investors, as well
    as the offer of considerable economic and technical assistance of
    various types. Although progress has been slow, the national operator
    Kyrgyztelecom has been steadily working at upgrading its outdated
    and poorly distributed network. Following the launch of a second GSM
    network by MegaCom in 2006, KT Mobile, the non-operational mobile
    subsidiary of Kyrgyztelecom, was granted frequencies in December 2006
    for GSM 900 and GSM 1800 mobile services. With a mobile penetration of
    around 35% in late 2007, the market still has plenty of room to grow.

    Mongolia Since the government's telecom reform program in the
    mid-1990s, there has been effective liberalisation of all market
    segments, partial privatisation of the fixed-line incumbent
    operator, Mongolia Telecom, and establishment of an independent
    regulator. Competition is in place for both fixed and mobile telephony,
    including local, long-distance, and international, Internet, VoIP,
    and VSATs. While the fixed-line network has been expanding slowly, the
    mobile phone market has undergone a remarkable boom, with the number
    of subscribers growing at an average rate of close to 50% year-on-year
    for a number of years. Two additional mobile licences were awarded
    in 2005/06 to Unitel (GSM) and rural mobile operator G-Mobile (CDMA),
    with both networks well founded for growth going into 2008. Although
    GDP has grown substantially, 36% of the population still lives below
    the international poverty line of US$0.75c per day, while the average
    monthly wage is US$70. Despite this, mobile penetration of less than
    40% indicates that there is still room to grow, particularly in the
    rural areas.

    Nepal Nepal is among the poorest and least developed countries in
    the world. Amid what has been an unsettled political climate, the
    country has surprisingly been able to move towards a more liberalised
    telecom market. Positive regulatory changes have been implemented,
    including the incumbent telco losing its monopoly status. By 2006,
    over 170 operators had been authorised to provide a wide range of
    telecom services, including two for basic telephony and two for
    mobile telephony. The expansion of telephone services has not been
    able to keep up with the growing demand; the biggest challenge has
    been to provide rural services. Over 60% of telephone services are
    concentrated in the capital Kathmandu. Nepal Telecom has been heading
    up an ambitious plan to increase total telephone penetration to 20%
    by 2010. Nepal's target of 15 total phone lines per 100 people by
    2014 already looked set to be achieved well ahead of schedule. On
    the back of the combined effort by Nepal Telecom and the private
    operators, a figure of 25 lines per 100 people by 2014 was being
    considered feasible - significantly higher than the 11% penetration
    (3% fixed; 8% mobile) at end-2007; in comparison, by end-2005 the
    combined penetration figure was just 1%.

    Tajikistan With a telecom network that was near total collapse when the
    Soviet Union fell, Tajikistan's government started on the daunting task
    of bringing it up to modern standards. The telecom network was arguably
    the least developed of all the countries that emerged from the former
    Soviet Union. The basic fixed network remains tiny, providing service
    to barely 5% of the population coming into 2008; and a large proportion
    of the network has not yet been converted to digital. A gradual process
    of liberalisation is under way and over the last decade a significant
    number of private operators have been allowed to enter the telecom
    market, notably in the mobile and Internet sectors. Privatisation of
    state-owned Tajiktelecom was expected to be achieved by end-2007. The
    highly competitive mobile sector experienced a major growth surge in
    2006 and 2007, the subscriber base jumping by around 200% over this
    two year period; this expansion looks set to continue. Interestingly,
    Tajikistan was the first of the CIS countries to launch a 3G network.

    Turkmenistan Turkmenistan is another nation that emerged
    from the former Soviet Union with a relatively underdeveloped
    telecom sector. Poor growth in telecoms services, slow progress in
    developing the private sector and continuing state control over most
    economic activities have not helped to support growth in the telecom
    market. Combined fixed-line and mobile teledensity was estimated at
    around 16% by end-2007. For almost a decade fixed-line growth has
    been virtually stagnant. And oddly, Turkmenistan's mobile market,
    served by one private and one state-owned operator, has not taken off
    like its neighbours but is only growing slowly (7% mobile penetration
    by end-2007). The Internet has been an interesting sector to watch;
    government has been exercising tight control, with online activity and
    access severely restricted. Reports have been emerging, however, that
    suggest Turkmenistan is moderating its restrictions on the Internet,
    though it is difficult to assess the trend.

    Uzbekistan Although steadily improving, much of Uzbekistan's telecom
    infrastructure remains outmoded and inadequate. The country has
    been struggling to bring its telecom system up to the standard
    found in developed countries. No doubt the government's decision to
    give priority to the telecom sector has seen the situation steadily
    improving. Back in 1996, in what was a significant move at the time,
    the government was encouraging foreign telecom companies to invest
    in Uzbekistan. This was followed by the creation of Uzbektelekom, a
    holding company charged with operating the national telecom network. An
    upward trend in the country's telecom market over recent years has
    seen rising revenues and increased investment in infrastructure. The
    next step is to privatise Uzbektelecom and to open the market to
    competition consistent with the country's objective of joining the
    WTO. Combined fixed and mobile teledensity was estimated at over 23%
    by end-2007, the mobile sector having just surged by more than 200%
    in a two year period.

    Key highlights: ~U Armenia's mobile market was growing at an annual
    rate of 80% in late 2007, with newcomer K-Telecom passing the one
    million subscriber mark and grabbing two-thirds of the market; ~U
    The current economic boom in Azerbaijan continued (GDP growth of 29%
    in 2007) and mobile penetration passed 50% with growth continuing at
    around 40% per annum.

    ~U Bhutan's telecom sector remains underdeveloped with mobile
    penetration still below 10%. The country moved towards a democratic
    system of government with elections in early 2008; the hope was that
    this would bring significant structural reform to all sectors of the
    economy; ~U In Georgia, the telecom regulator awarded a third 3G mobile
    licence, creating further interest in a market that had remarkably
    passed 50% mobile penetration by late 2007; ~U Kazakhstan's mobile
    market has been characterised by a prolonged surge in subscribers,
    reaching 13 million (a penetration of 75%) by early 2008, up from
    only 1.3 million in 2003.

    ~U Kyrgyzstan, the first Central Asian Republic to be admitted to
    the WTO, continues to work on reforming the telecom sector; mobile
    subscriber growth exceeded 100% in 2007; ~U With the launch of two new
    mobile operators, Unitel and G-Mobile in 2006 and 2007 respectively,
    mobile subscribers in Mongolia passed 1 million going into 2008,
    representing an annual growth of just under 50%.

    ~U Nepal Telecom initiated an ambitious program in 2007 to increase
    total telephone penetration (fixed plus mobile) to 20% by 2010;
    the plan came as Nepal entered a more stable period politically; the
    mobile market is growing at an annual rate of around 140%; ~U With
    a population of just over 7 million, Tajikistan's busy mobile sector
    (7 operators) continued the major growth surge that started in 2006;
    the subscriber base jumped by more than 100% in 2007.

    ~U Compared with most of the other Central Asian markets Uzbekistan's
    mobile penetration of 20% towards end-2007 was modest; however the
    year saw subscriber growth exceed 120%.

    Central Asian markets ranked by GDP per capita - mobile penetration
    & annual growth - September 2007 Country Penetration Annual growth
    GDP per capita (US$) Kazakhstan 75% 65% 8,800 Mongolia 35% 53% 2,900
    Azerbaijan 51% 40% 2,500 Armenia 54% 79% 2,300 Bhutan 6% 111% 2,000
    Turkmenistan 7% 88% 1,400 Georgia 49% 25% 1,000 Uzbekistan 16% 120%
    800 Kyrgyzstan 34% 120% 600 Nepal 6% 104% 400 Tajikistan 22% 119%
    300 (Source: BuddeComm) Data in this report is the latest available
    at the time of preparation and may not be for the current year.

    This report provides a comprehensive overview of the trends and
    developments in telecommunications and digital media markets in 11
    countries in Central Asia (Armenia, Azerbaijan, Bhutan, Georgia,
    Kazakhstan, Kyrgyzstan, Mongolia, Nepal, Tajikistan, Turkmenistan
    and Uzbekistan). Subjects covered include: Key Statistics; Market
    and Industry Overviews; Regulatory Environment; Major Players (fixed
    and mobile); Infrastructure; Mobile Voice and Data Markets; Internet,
    VoIP, IPTV and Broadband development.

    Researchers:- Peter Evans and Lisa Hulme-Jones Current publication
    date:- June 2008 (14th Edition) Next publication date:- June 2009.

    Author: Mike King
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