Myanmar’s Budding Telecom Market
Myanmar is a populous country in the Association of Southeast Asian Nations (ASEAN) whose population stood at around 57 million by the end of 2017. In 2013, Myanmar promulgated its new Telecommunications Law that outlined a reform plan for its telecom sector by introducing private enterprises to increase competition. Soon afterwards, two foreign operators—Ooredoo and Telenor—pledged to invest billions of dollars to develop the country’s telecom market. The two operators plus the state-owned MPT JO and the newly-established joint venture Mytel form the four-party competition pattern in Myanmar where all the four telecom players can operate both wireless and wireline broadband services.
After four to five years of development, Myanmar has boasted 54 million mobile users, with its wireless penetration surging to 95% and its mobile communications industry galloping ahead.
The Coming Explosive Fixed Broadband Market
As in neighboring countries, operators in Myanmar also set their first sights on wireless network construction. The total number of 2G, 3G and 4G wireless sites in Myanmar increased over 10-fold, reaching more than 20,000 at the end of 2017. Mobile phones became a necessity of the Myanmarese daily life, and Facebook and YouTube were favorite applications for the young people. However, faced with the challenges of a bottleneck for wireless user growth, a very low penetration rate of fixed broadband, and the data usage habit being acquired by users, operators in Myanmar began to develop their new killer services one after another. They speeded up the deployment of fixed broadband (FBB) services in 2017, with the hope to offer fixed-mobile convergence (FMC) packages to enhance their brand attractiveness.
MPT JO is the largest telecom operator in Myanmar and also the only operator owning both copper and fiber resources. In 2017, MPT JO updated its FBB service packages to provide government, enterprise and home users with high-speed broadband access at rates from 1 Mbps to 100 Mbps. The services covered four tourist areas and over 70% of the population of Myanmar, making MPT JO the operator with the widest wireline coverage in the country.
The two foreign-owned operators, Ooredoo and Telenor, also entered the fray. Employing existing fiber resources on their wireless bearer networks, the two operators launched fixed broadband services in 2017. Telenor specially rolled out its broadband packages with no annual fees or subscription fees as well as its innovative service to ensure installation within seven days in core areas, attracting many new fixed broadband users. Mytel, a late joint-venture entrant to the Myanmar market, also made aggressive plans. Learning from the mature “GPON+IPTV” model operated by its investor Viettel in Vietnam, Mytel developed a strategy for 2018 that could cover the country’s key townships by promoting both wireline and wireless deployments.
The First to Deploy MSAN
MPT was originally a state-owned operator governed by the Ministry of Communications and Information Technology (MCIT) of Myanmar. In 2014, MPT introduced Japan’s KDDI Sumitomo Global Myanmar (KSGM) as a strategic partner to compete with Ooredoo and Telenor. KSGM promised to invest two billion dollars within 15 years starting from July 2014 to strengthen MPT's network operations.
Between 2014 and 2017, MPT JO carried out a massive network reconstruction involving multiple phases of capacity expansion for its 3G and 4G wireless networks, which helped it secure the position as the largest operator in Myanmar.
MPT JO also has nearly 600,000 fixed-line users, accounting over 90% of all wireline subscribers in the country. To meet the growing need for broadband access, MPT JO initiated the first phase of the PSTN project in 2014 to cover 160,000 users. Its objective was to upgrade the fixed networks in big cities such as Yangon and Mandalay. The existing copper resources in the user section were reused, and the convergent access sites were replaced by multi-service access nodes (MASN) that could support integration of copper and fiber. MASN would serve as a platform to develop future DSL and FTTx services. Considering the high cost of fiber deployment, MPT JO planned to adopt differentiated pricing models for different user groups. At the current stage, DSL services are targeted to existing low-bandwidth home users (less than 10M), while FTTx services are designed for customers in hotels, business districts and new skyscrapers.
Partnering with ZTE for Network Reconstruction and User Migration
In 2015, MPT JO started its PSTN reconstruction project and finally chose MASN as the new access network platform. The platform supports simultaneous configuration of POTS, DSL, P2P and GPON to meet different user requirements. Moreover, for some high-value users in cities, copper lines can be deployed within one kilometer from users so that VDSL2 can be used to improve user broadband experience.
MPT JO's reconstruction project was implemented in four phases, covering nearly 600,000 users and involving complex outside plant upgrade and fixed-line voice migration. Because routes varied greatly from area to area, upgrading the access network platform from PSTN to MSAN involved much work for each site, including a detailed survey (space, power supply, copper quality, uplink interfaces, and MDF/DC capacity), route optimization, and adding/adjusting DC locations. This posed high requirements for project execution and management. Accurate migration of voice users in batches also caused great difficulties. As MPT JO had operated voice service for many years, voice cables in the equipment room were multifarious and disordered. These cables had to be first sorted one by one, and then routes were adjusted that might involve hard engineering work such as land acquisition, pole erection, trenching, and cable burial. The five-month rainy season in Myanmar would also be a hindrance to such work.
After a rigorous selection process, MPT JO decided to award the PSTN project for Myanmar's northern part to ZTE as a turnkey package. Prior to that, ZTE had just helped MPT JO complete a turnkey FTTH deployment in the three renowned tourist areas of Inle Lake, Ngapali Beach and Ngwe Saung. MPT JO became the first operator to offer fixed broadband access in the three areas. More than 90% of hotels in the areas subscribed to MPT JO's fixed broadband services and their investments would be recouped in two years.
MPT JO selected ZTE for the PSTN project not only because ZTE is a global leader in the fixed broadband sector, but also for the long-term trust established between the two parties after many cooperative projects. ZTE entered the Myanmar market in 1999 and has operated there for almost 20 years. Apart from seven representative offices with a total staff of over 600, ZTE also locally set up a customer service center, a training center, logistics warehouses, and a spare parts base.
For the PSTN project, ZTE and MPT JO made a detailed plan for phased deployment, discussed contingency measures, and confirmed high level design and low level design (HLD/LLD) schemes for every site to reduce possible user complaints during the project process.
To deal with the huge workload of voice migration, ZTE developed an automatic sorting tool and a portable copper quality inspection device, which greatly improved migration efficiency and reduced the risks. With the joint effort of ZTE and MPT JO, the engineering efficiency was significantly improved. The Phase I project was completed nearly half a month ahead of schedule.
Enormous Potentials in the Fixed Broadband Market
While upgrading its networks, MPT JO also pays close attention to industry dynamics and competition. Feasible plans are made for GPON/XG-PON evolution, intelligent network management, and IPTV content collaboration, with an eye to advancing both copper and fiber technologies. Although many industry players have noticed its opportunities, Myanmar's fixed broadband market is still just beginning and there are many areas for improvement:
● Deepening the convergence of "fixed and mobile packages". To make the most of its strengths and boost user attractiveness, a mature mobile operator has to plan and prepare for fixed-mobile convergence (FMC) in advance, whether the convergence is at the user or network level.
● Fostering the user habit of consuming unlimited data. The biggest advantage of fixed broadband lies in its ability to offer high-bandwidth unlimited-data packages. Because there is still a shortage of bandwidth-intensive videos and applications in Myanmar, it will take time for users to create their habits around data consumption.
● Controlling cost through optimal operations. Generally, wireline broadband projects have a longer implementation cycle and involve considerable labor and maintenance costs. During network construction, operators need to consider how to reduce manual operations and fiber deployment costs that include the right of way acquisition.
Telecom has brought enormous changes to the life of Myanmar people. As Myanmar strengthens exchanges with neighboring countries and the Western world, it is embracing outside investments into its industries to jump-start economic growth. Myanmar's fixed broadband market led by MPT JO will also enter a new era.
MPT JO, Myanmar, Fixed broadband, MSAN, user migration, FMC