Bidders for telecom licences in Myanmar are stepping up activities in the country in hopes of scoring high in a “beauty contest” being held by consultants hired by the government.
The 12 shortlisted candidates were prequalified on April 11. The two successful applicants will be named on June 27. The government intends to finalise the granting of licences by September.
The government engaged Munich-based Roland Berger, a global marketing strategy consulting group with about 50 offices worldwide, to map out the selection criteria.
Executives from Roland Berger’s Singapore office told a news briefing in Yangon that the winners would be ranked on a 1,500-point scale, with 1,000 points or 67% for technical qualifications and the remaining 500 points or 33% representing financial qualifications.
The technical score is based on eight categories, ranging from infrastructure and coverage commitment to corporate social responsibility, while the financial score is based solely on the licence fee offer.
The operating licences will have a duration of 15 years and the possibility of a 10-year extension. The operators have to launch commercial service no later than nine months after the effective date of the licence.
The licensing agreement requires voice coverage for 25% of the country and data services for 10% within a year. The spectrum will consist of two blocks of 5 Megahertz each in the 900 MHz band and two 10MHz blocks in 2100 MHz band.
Set Aung, the chairman of the telecoms selection committee – made up wholly of government ministers – said the country was aiming for a 50% mobile penetration rate by 2016 compared with about 9% now. President Thein Sein in March had set a target of 80% by 2015.
Myanmar Posts and Telecommunications (MPT), the government-owned sole provider of telecoms now, will become the third operator after the two licences are awarded. Yatanarpon Teleport – a distribution arm of MPT – will become the fourth. The government is now drafting a new telecommunications law and looking toward liberalisation and competition, Set Aung said.
To gear up for the untapped market of 61 million consumers, global players have entered consortia as they jostle for licences. The world’s two largest mobile operators, Vodafone and China Mobile, formed a consortium and post the highest annual revenue out of all the applicants at US$75 billion (2.2 trillion baht) a year. France Telecom Orange and Marubeni come next, at $57.5 billion a year, followed by KDDI, Sumitomo, MICTDS and A1 — a consortium of Myanmar and Japanese companies — at $43.5 billion a year.
Norway’s Telenor, Qatar’s QTel, Vietnam’s Viettel, Malaysia’s Axiata and Luxemborug’s Millicom International are going it alone, without joining in any consortia.
Meanwhile, Singapore’s Singtel has joined a consortium with Myanmar’s Royal Myanmar Transport (KBZ) and M Tel; South Africa’s MTN has joined with Lebanon’s M1 Telecom and Myanmar’s Amara Communications; India’s Bharti Airtel has joined with Palazio of Cyprus; and Jamaica-based Digicel has joined with billionaire George Soros’s Quantum Strategic Partners and tycoon Serge Pun’s Myanmar conglomerate Yoma Strategic Holdings.
To win over the telecoms beauty pageant judges, a number of companies have moved into the country to sponsor corporate social responsibility (CSR) initiatives. On May 15, SingTel sponsored an International Bridges to Justice forum on regional legal aid, distributing a picture to local media of Mark Chong, Singtel’s chief executive, shaking hands with Myanmar’s deputy attorney-general, Tun Tun Oo.
Telenor Group expressed unbridled confidence during a press conference on April 26, where executive vice-president Sigve Brekke laid out the company’s plans if it wins. Telenor’s “country-wide rollout will not be a gradual process, but instead [Telenor] will provide access to the market as soon as possible”, he said.
Telenor is the majority shareholder in DTAC, Thailand’s second-largest mobile provider. On May 15, it also held a corporate social responsibility roundtable to which it invited members of the media. “At Telenor, we are committed to serving as a catalyst for development in each and every market in which we operate,” its Myanmar-based marketing firm, Mango Marketing, said in a local release. Telenor also invited Myanmar journalists to cover a conference sponsored by DTAC on May 20 and 21 with all expenses paid.
Digicel is well known for its public relations campaigns at Myanmar’s football matches, where the company sponsors local teams, promotional goods, beer and even the colour of the players’ uniforms – red, Digicel’s company colour, which fans and players now wear as an act of solidarity.
