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Cambodia - Telecoms, Mobile, Internet and Forecasts

Executive summary

Cambodia’s crowded mobile sector sees major shake-out as operator numbers shrink

Despite its status as a least developed country and remaining one of the poorer countries in Southeast Asia, Cambodia’s efforts to expand and upgrade its telecom infrastructure have been bearing fruit. In this country of around 15 million people, there was very little infrastructure remaining from before the tumultuous Khmer Rouge days. As a result, Cambodia largely by-passed rebuilding the fixed-line market and quickly launched into alternative technologies, jump-starting its telecommunications infrastructure with digital technology. Not surprisingly, mobile services completely overwhelmed the market, at least initially.

In recent times there have been between eight and ten mobile operators vigorously competing with each other in a crowded market segment that continued to grow at a healthy annual rate, despite the obstacles. By mid-2013, there were over 18 million mobile subscribers (penetration 118%); on the basis of reported statistics the market experienced a ‘correction’ in the first half of 2013, falling from around 20 million reported subscribers at end-2012. (It is noted that the available statistics are somewhat inconsistent, but, where appropriate, reasonable estimates have been made in the report.) The mobile market was continuing to grow following the correction, although probably at a more modest rate.

The mobile market had started to go through some form of rationalisation by 2011. By that stage there were nine licensed operators. The number of operators dropped to eight in that year when the merger of two of the operators was approved by the authorities. Then, after a great deal of activity on this front in 2012, two major changes took place: the closure of financially struggling Mfone finally occurred in early 2013, leaving the country with six major mobile networks; and in March 2013, Hello Axiata merged with Smart/Latelz to form a refreshed Smart Mobile. This saw the number of major operators fall to five. Importantly, the new, combined Smart emerged as the second largest of mobile operators, with over five million customers, not far behind the market leader Viettel’s Metfone.

The limited fixed-line telephony growth that had come about in Cambodia earlier on had mainly been through investment under foreign assistance plans, focusing on the capital Phnom Penh. Subsequently, geographical coverage did not increase significantly for a decade or more. The number of fixed-line services remained relatively static for some years at around 50,000. By 2010, however, the numbers were starting to head upwards. The arrival of Viettel in the market place in 2009 proved to be the trigger for a surge in growth. By end-2012 there were a reported 720,000 fixed-line subscribers, representing a healthy teledensity of 5% and growing. (Again, there remained some uncertainty about the accuracy of the available statistics.)

The expansion of the internet in Cambodia has been largely overshadowed by the strong focus on mobile services. Internet take-up rates remained disconcertingly low for many years, with the country claiming one of the lowest internet penetrations in the region. The limited fixed-line infrastructure had been a major inhibiting factor in the roll-out of both dial-up and DSL internet services. The market started to shift in 2007 when wireless broadband services began to appear, offering an effective alternative fixed access service to DSL. By 2012, however, fixed broadband internet penetration remained low (0.3%). By contrast, mobile broadband was expanding rapid at the same time boosting online activity generally; as will telephony, mobile services were clearly ‘filling the gap.’

Faced with growing concern about the country’s regulatory regime, the government finally moved on the long awaited establishment of an autonomous industry regulator. The Ministry of Posts & Telecommunications (MPTC) officially launched the Telecommunications Regulator of Cambodia (TRC) in September 2012. The move effectively transferred the regulatory role of the MPTC to the TRC, making the new authority responsible for the key areas of spectrum allocation and the regulation of pricing, among others. The regulator also had the authority to deal with a range of disputes including technical, operations and network usage matters.

Market highlights:

  • Cambodia’s mobile market continued during 2012, although it experienced a ‘correction’ in total subscriber numbers in the first half of 2013;
  • Mobile penetration had reached 118% by June 2013, the market having a reported 18.4 million subscribers by that stage;
  • The crowded mobile market had started to see some rationalisation, the number of mobile operators falling from nine in 2011 to just four major players;
  • Considerably drama surrounded the demise of Thaicom-owned Mfone as it declared bankruptcy and exited the market;
  • Hello Axiata and Smart Mobile merged to form a refreshed Smart Mobile, majority owned by Axiata, thereby setting up a serious challenger to Viettel’s Metfone;
  • The fixed-line market, having been very sluggish for more than a decade, had suddenly picked up momentum on the back of a major push by Viettel;
  • Fixed-line subscriber numbers had and by early 2013 a teledensity of 4% was reported;
  • The internet segment had also been struggling for some time, but there were promising signs that the introduction of wireless broadband services was finally boosting fixed broadband growth;
  • Of significance for the broadband market has been the rapid expansion of mobile broadband access, with one million subscribers being reported by March 2013;
  • The ITU was reporting around 700,000 internet users (5% user penetration) by end-2012 (this figure seemed low, however, given the reported one million mobile broadband subscribers);
  • In an important move, the government officially launched the Telecommunications Regulator of Cambodia (TRC) in September 2012;
  • Vimpelcom announced the sale of its entire stake in Sotelco in April 2013, Beeline Cambodia being duly transferred to the local partner;
  • A draft National Broadband Policy had been prepared by the MPTC and as of May 2013 it was awaiting government approval.

Cambodia - key telecom parameters – 2011 - 2013

Category
2011
2012
2013 (e)
Fixed-line services:



Total No. of subscribers
530,000
584,000
625,000
Internet services:



Total No. of subscribers1
47,000
55,000
63,000
Mobile services:



Total No. of subscribers
13.8 million
20.0 million
19.0 million

(Source: BuddeComm)

Note: 1Fixed subscribers

This report provides an overview of the trends and developments in the telecommunications markets in Cambodia. Subjects covered include:

  • Key statistics;
  • Market and industry overviews;
  • Major operators (mobile and fixed);
  • Regulatory environment;
  • Infrastructure;
  • Mobile market;
  • Internet market;
  • Broadband internet (fixed and mobile);
  • Telecom market scenario forecasts for subscribers (mobile, internet, fixed) for 2015 and 2020.

Data in this report is the latest available at the time of preparation and may not be for the current year.

Table of Contents

  • 1. Executive summary
  • 2. Key statistics
  • 3. Country Overview
    • 3.1 Background
    • 3.2 Economy
    • 3.3 Political relations
      • 3.3.1 Cambodia-US
      • 3.3.2 Cambodia-Thailand
  • 4. Telecommunications market
    • 4.1 Overview of Cambodia’s telecom market
  • 5. Regulatory environment
    • 5.1 Regulatory authority
      • 5.1.1 Ministry of Posts & Telecommunications (MPTC)
      • 5.1.2 Telecommunications Regulator of Cambodia (TRC)
      • 5.1.3 Corruption
    • 5.2 Regulatory developments
      • 5.2.1 National broadband policy
      • 5.2.2 Minimum call tariffs and promotional offers
      • 5.2.3 Thai operators alleged to have crossed Cambodian border
      • 5.2.4 3G service restrictions
      • 5.2.5 Restrictions on marketing practices
  • 6. Telecommunications infrastructure
    • 6.1 National telecom network
    • 6.2 Forecasts – fixed-line market – 2015; 2020
    • 6.3 Optical fibre networks
    • 6.4 Mobile towers
    • 6.5 Fixed-line operators
      • 6.5.1 Telecom Cambodia
      • 6.5.2 Viettel
      • 6.5.3 Digi
    • 6.6 International infrastructure
      • 6.6.1 Greater Mekong Subregion Information Superhighway (GMS-IS)
      • 6.6.2 Cambodian-Vietnamese Super Highway Telecoms Network
      • 6.6.3 Proposed submarine cable
  • 7. Internet market
    • 7.1 Overview
    • 7.2 Background
    • 7.3 Internet statistics
      • 7.3.1 Tablet sales
    • 7.4 Forecasts – internet services – 2015; 2020
    • 7.5 WiMAX
      • 7.5.1 Overview
      • 7.5.2 Frequency licensing problems
      • 7.5.3 Smart
      • 7.5.4 Digital Star
    • 7.6 Long term evolution (LTE) network
    • 7.7 AngkorNet
  • 8. Mobile communications
    • 8.1 Overview of Cambodia’s mobile market
    • 8.2 Mobile statistics
    • 8.3 Forecasts – mobile services – 2015; 2020
  • 9. Major mobile operators
    • 9.1 MobiTel (CamGSM)
      • 9.1.1 Overview
      • 9.1.2 Statistics
      • 9.1.3 Millicom sale
    • 9.2 Mfone (CamShin)
      • 9.2.1 Overview
      • 9.2.2 Statistics
      • 9.2.3 Uncertainty followed by Bankruptcy
    • 9.3 Hello Axiata
    • 9.4 AZ Communications
    • 9.5 Metfone (Viettel)
    • 9.6 CadComms (QB)
    • 9.7 GT-Tell (Excell)
    • 9.8 Smart Mobile (Latelz)
    • 9.9 Applifone (Star Cell)
    • 9.10 Beeline Cambodia (Sotelco)
    • 9.11 CooTel (Xinwei)
  • 10. Cambodia’s broadcasting market
    • 10.1 Overview
    • 10.2 Cable TV
    • 10.3 Satellite TV
  • 11. Notes on scenario forecasts
  • 12. Related reports
  • Table 1 – Country statistics Cambodia – 2013
  • Table 2 – Telephone network statistics – 2012
  • Table 3 – Internet user statistics – 2012
  • Table 4 – Mobile statistics – June 2013
  • Table 5 – National telecommunications authority
  • Table 6 – Cambodia’s GDP real growth rate – 2006 - 2014
  • Table 7 – Fixed lines in service and penetration – 1995 - 2014
  • Table 8 – Forecast fixed-line growth – 2015; 2020
  • Table 9 – Internet users, annual change and penetration – 1997 - 2014
  • Table 10 – Fixed internet subscribers – 1999 - 2013
  • Table 11 – Internet household penetration – 2008 - 2013
  • Table 12 – Fixed broadband subscribers – 2005 - 2014
  • Table 13 – DSL subscribers – 2003; 2006 - 2011
  • Table 14 – Fixed broadband subscribers and households – 2013
  • Table 15 – Mobile broadband subscribers –2010 - 2012
  • Table 16 – Total international internet bandwidth – 1999 - 2012
  • Table 17 – Forecast fixed internet subscriber growth – 2015; 2020
  • Table 18 – Mobile subscribers, annual growth and penetration – 1993 - 2014
  • Table 19 – Mobile operators, systems, total subscribers and annual change – 2012
  • Table 20 – Mobile subscribers and market share by operator – 2012
  • Table 21 – Mobile services sector estimated ARPU – 1998 - 2012
  • Table 22 – Forecast mobile subscriber growth – 2015; 2020
  • Table 23 –MobiTel (CamGSM) mobile subscribers – 1998 - 2012
  • Table 24 – MobiTel: 3G subscribers – 2006 - 2013
  • Table 25 – Mfone (CamShin) mobile subscribers – 1998 - 2012
  • Table 26 – Mfone 3G subscribers – 2012 - 2013
  • Table 27 – Hello Axiata: mobile subscribers – 1998 - 2012
  • Table 28 – Hello Axiata: 3G subscribers – 2012 - 2013
  • Table 29 –Metfone (Viettel) mobile subscribers – 2009 - 2012
  • Table 30 – Metfone: 3G subscribers – 2012 - 2013
  • Table 31 – Cadcomms (QB) mobile (3G) subscribers – 2008 - 2013
  • Table 32 – Smart Mobile subscribers – 2011 - 2012
  • Table 33 – Smart Mobile (Latelz): 3G subscribers – 2012 - 2013
  • Table 34 – Applifone (Star Cell) subscribers – 2008 - 2009
  • Table 35 – Beeline Cambodia subscribers – 2009 - 2012
  • Table 36 – Beeline Cambodia’s ARPU – 2011 - 2012
  • Table 37 – Key broadcasting statistics – 2012
  • Chart 1 - Cambodia's GDP real growth rate - 2006-2014
  • Chart 2 - Fixed lines in service and penetration – 2006-2013
  • Chart 3 - Internet users and annual change - 2006-2013
  • Chart 4 - Internet subscribers - 1999-2013
  • Chart 5 - Fixed broadband and DSL subscribers - 2006-2014
  • Chart 6- Mobile market – subscribers and penetration – 2000 – 2013
  • Chart 7 - Mobile market share by operator - 2012

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