2007 South East Asian - Mobile Communications and Mobile Data Markets

This Asia market annual report covers 11 countries in the South East Asia sub-region. It takes an overall look at the mobile communication and mobile data markets in each of the countries.

The South East Asian countries covered include: Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Timor Leste, and Vietnam.

The mobile market in South East Asia consists of a mix of highly penetrated and considerably less penetrated economies. The one consistent element is the period of high growth being experienced across the sub-region. Malaysia is the exception as its mobile market undergoes market consolidation. By June 2007, the region had amassed 1.2 billion mobile subscribers. Of these, a total of around 230 million were to be found in South East Asia. In terms of total subscribers, the market leader was Indonesia (75 million mobile subscribers), followed by the Philippines (49 million) and Thailand (47 million).

South East Asia mobile markets - subscribers, penetration and annual change - June 2007

Highlights in the individual mobile markets of South East Asia include:

Brunei

A small wealthy nation in South East Asia, Brunei made early moves to ensure that it was delivering up to date telecommunications services to its population. The target of 100% digitalisation was achieved way back in 1995. Telecommunications throughout Brunei are of a high standard and the country ranks well in Asia in terms of penetration and infrastructure. Brunei’s mobile penetration, which stood at a reasonably healthy 32% by end-2001, continued to grow strongly and had hit an amazing 118% by March 2007. Despite the growth, Brunei needs to look to further restructure its telecom sector if it is to take full advantage of the benefits of a competitive market. For the country overview, see chapter 2, page 5.

Cambodia's

Cambodia’s flourishing mobile market passed the one million subscriber milestone in late 2005 and continued to grow at a healthy annual rate of almost 40% through 2006. By June 2007, there were 1.9 million mobile customers (over 13% penetration), as mobile services continued to totally overshadow the fixed-line segment of the market. (Fixed-lines were languishing at around 40,000 subscribers.) Given the booming mobile market, it may be surprising to also find other sectors of the market in the doldrums. For the country overview, see chapter 3, page 8.

Indonesia

The mobile market in Indonesia has continued to expand and by mid-2007 the market sector was growing at a rate of close to 60%; the subscriber base had reached almost 75 million, up from 4 million subscribers just six years earlier. While mobile penetration has quickly raced to almost 33%, there is considerable potential remaining for further growth in this market. With the government having already issued 3G licences to five operators - in what was a somewhat chaotic administrative process spread over some years - there was mounting interest in which direction the mobile market would take. For the country overview, see chapter 4, page 13.

Laos

The country’s mobile phone market finally took off in early 2003, the number of subscribers increasing sevenfold over the next two years. The market was continuing to grow at an annual rate in excess of 40% by March 2007 and there were almost 900,000 mobile subscribers (penetration of 13%) in the country. The Lao telecom sector still has many issues to address. Despite the rapid opening up of the market, the regulatory progress continues to lag behind market development and has the potential to derail the progress already made if reform is not speeded up. For the country overview, see chapter 5, page 36.

Malaysia

Mobile penetration passed the 85% mark in the first half of 2007, with subscriber numbers at the same time passing 21 million. This was up from only 2 million subscribers in 1998. Malaysia has the second highest mobile penetration in South East Asia after Singapore. The country’s mobile users have also been enthusiastic in their adoption of SMS, with the regulator reporting that Malaysians sent more than nine billion SMS during 2005. For the country overview, see chapter 6, page 40.

Myanmar's

The country’s telecommunications market is characterised by what can only be described as stunted development. The telecom sector is indicative of the overall state of the national economy. Myanmar’s official economic data is not considered reliable, making actual growth rates difficult to ascertain. However, it is reasonably evident that fixed telephone line penetration remains a lowly 1%, mobile services are prohibitively expensive and limited (mobile penetration of 2% is reported). For the country overview, see chapter 7, page 64.

The Philippines

There has been a rapid take-up of mobile services and, following on from that, a remarkably high national usage of the SMS has occurred throughout the country. Mobile penetration has grown quickly to have reached 56% (almost 50 million subscribers) by June 2007, up from only 6 million mobile subscribers in the country in 2000. For the moment it looks to have reached a plateau, although further growth cannot be dismissed. Not surprisingly, mobile services have well and truly overwhelmed fixed-line services. Much of the recent growth in mobiles was coming from outside the main city of Manila, with the big operators, Globe and Smart, vying for lower income segments of the population by offering a range of cheap prepaid products. For the country overview, see chapter 8, page 67.

Singapore

The mobile market in Singapore is characterised by its energy and innovation. Even as the growth slowed a little – annual growth of 21% in June 2007, penetration at 116% - considerable effort continued to go into value-added products and services. At the same time, the market is approaching the future cautiously. The planning for 3G has been a case in point. The major operators and, to some extent, the government have been circumspect about the next generation of mobile telephony and the benefits it will bring. Despite this caution, all three mobile operators had launched 3G services by early 2005. Of the 5.2 million mobile subscribers in June 2007, 1.25 million were 3G services. For the country overview, see chapter 9, page 95.

Thailand's

Thailand’s telecom sector has exuded considerable energy in recent times, despite some economic uncertainty, questions about political stability and ongoing question of just how committed the government is to sector reform. Over the last four or five years, the country’s mobile telephone market in particular recorded particularly strong annual growth rates. By mid-2007, mobile penetration had passed 70%, but the annual subscriber growth rate had slowed somewhat to 38%. The country has certainly been seeing the benefits of a liberalised market. For the country overview, see chapter 10, page 123.

Timor Leste

The tiny fledgling nation of Timor Leste (East Timor) has continued to experience political instability and outbreaks of violence. Telecommunications remains an important priority under a newly established Ministry of Transport, Communication & Public Works (MTCPW). In 2002, the government selected Portugal Telecom to be the lead partner in a consortium to operate Timor Telecom. The new operator replaced Telstra during 2003 and set about expanding the countries telecom facilities. For the country overview, see chapter 11, page 157.

Vietnam

The country’s mobile market has been especially dynamic, growing at an annual rate of almost 100%. The strong growth was likely to continue, building on the more than 24 million mobile subscribers (penetration 30%) in the country by June 2007. As with most other Asian mobile markets, growth in Vietnam was substantially boosted by the introduction of prepaid mobile services. For the country overview, see chapter 12, page 158.

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