Asia - Mobile Network Operators and MVNOs

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Last updated: 13 Jul 2022 Update History

Report Status: Current

Report Pages: 676

Huge diversity and a widening range of extremes embody Asia’s telecommunications sector

Viewed as a whole, the Asian telecommunications market is too large and diverse to be characterised as a single, homogeneous environment. Tremendous variation can be found across the vast region in terms of culture, politics, and wealth. These factors, in turn, strongly influence a country’s business climate as well as its level of competitiveness. While some similarities can be seen within each of the sub-regions of North, Central, and South East Asia, there are often as many differences and unique features to be found between the countries that comprise each geography. Polar opposites sometimes even exist between two neighbouring countries, e.g., North and South Korea; or Turkmenistan and Kazakhstan.

With regard to telecommunications, the state of each individual country’s markets is often a direct reflection of the presiding government policy during the previous 50 years. This is especially so in Central Asia, where many of the states that make up that sub-region emerged from the Soviet Union in the early-1980s. This has served to hold back many of the countries in Central Asia, in particular, in terms of their economic development as well as the progress of their telecommunications sectors; most inherited outdated and poorly maintained fixed networks that have proved too costly or challenging to upgrade or replace with anything other than mobile services.

Parts of South East Asia have had their challenges too, with Vietnam, Laos, and Cambodia suffering through years of regional conflict that left much of their infrastructure completely destroyed. Yet those countries have shown considerable resilience in being able to pick themselves up and establish reasonably widespread coverage with the help of international partners and aid.

Going further back in time, we see several Asian countries that have transformed themselves out of the ravages of war to become worldwide leaders in the telecommunications industry. Japan, South Korea, China, and Taiwan stand out by leveraging their post-war industrialisation capabilities to become major global players, launching companies like Samsung, LG, Huawei, and ZTE. Prioritising the development of a telecommunications industry has also helped to propel those countries’ economies forward, through the improved connectivity and widespread accessibility to high-quality communications services.

The Asian region is also home to some of the world’s worst-performing telecoms markets. This has often come about as a result of the presence of oppressive political regimes: North Korea, Afghanistan, Turkmenistan, are the first that come to mind. These three countries languish at or near the bottom of the global scale for telecommunications market maturity, and there is little hope of that situation changing for them any time in the near future. They are unfortunately soon going to be joined by Myanmar, where (as with Afghanistan) a recent military coup has created an untenable situation for mobile network operators to sustain their business.

With some of the largest countries in the world by population, Asia is inevitably home to some of the largest mobile markets (China, India, and Indonesia) – at least in terms of subscriber numbers. However, penetration rates in these three countries, in particular, remain relatively low due to economic disparity as well as the physical challenge of deploying networks into the more remote regions. At the very least, tremendous growth potential still exists in these extraordinarily large markets.

High levels of maturity and saturated markets in other parts of Asia means that many operators have had to shift their focus towards growing ARPU. This has become even more urgent following heavy (and costly) investments in 5G infrastructure. Their aim now has to by to find ways to monetise that investment, with the majority of consumers left feeling underwhelmed by the proposition of getting faster performance but still lacking that critical killer app.

5G deployment remains somewhat scattered across the region. While some countries have adopted a vigorous rollout schedule (often at the behest of the government to provide increased coverage and accessibility to high-speed broadband services), many others have been happy to take a wait-and-see approach. The latter situation is often found where overall mobile penetration rates are still on the increase, or there is excess capacity on the LTE networks to meet current demand (and expectations) for data consumption.

To lower the collective cost of deploying new or upgraded mobile networks, infrastructure and spectrum sharing agreements are now commonplace. Spectrum continues to be at a premium in many countries, and this has seen the launch of 5G services being held back due to a current lack of suitable spectrum, e.g., Indonesia. Other countries have been actively re-farming spectrum from 2G or 3G to give hungry operators the necessary bandwidth. Australia, for one, has completely shut down its GSM networks and 3G is about to follow suit.

Yet while many operators and industry regulators are just now confronting the challenge of how to establish commercially viable 5G networks and services, 6G is already appearing on the horizon. China, South Korea, and Japan are working hard on the development of 6G in the hope of gaining lucrative patents on the technology – or at least being able to exert strong influence over the standards process that will get under way within the next few years. The main focus is on using 6G in satellite networks, IoT, vehicle connectivity, and industry applications. But with 5G accounting for 30% of all mobile subscriptions in South Korea at the start of 2022 and China expected to have more than two thirds of the world’s 5G connections by 2025, it may be that these countries have a much clearer view of the future of mobile telecommunications than most.

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