Published on Thursday, 27 June 2013 19:21
Myanmar's government has finally announced Qatar Telecom (Ooredoo) and Norwegian Telenor as the winners of two mobile operating licences, defeating many expectations in the hotly contested race for one of Asia's untapped telecom markets.
Myanmar's Telecommunications Operator and Tender Evaluation and Selection Committee released a press statement on Thursday evening confirming the two winners.
"(The Union Government) is pleased to announce that Telenor Mobile Communications and Ooredoo have been accepted as the two successful applicants in the nation-wide Telecommunications Licence Award Process," said a press statement posted on the website Ministry of Communications and Information Technology.
Neither company opted to join with a local partner, defeating many experts' expectations that partnerships with national businesses would provide a key advantage in the race. Many had their eyes on SingTel, Digicel and Japan's KDDI consortiums because of their strong marketing campaigns, choice of local business partners and favourable government relations with Myanmar.
Now the chips have fallen, it is clear that the right investment strategy any strong marketing may have won the day.
Ooredoo is Qatar’s national telecom company (formerly QTel) and has operations in 17 markets across the Middle East, North Africa, and Asia. Ooredoo did not invest in big marketing campaigns like rivals Digicel and Telenor. However, it did announce that it would spend US$ 15 billion in mobile infrastructure if it is chosen for a license. This was by far the largest sum proposed by any company.
Telenor on the other hand is Norway's State-owned company with operations in 11 markets. While during the tender they kept quiet on revealing how much money they would invest, they have run one of the strongest marketing campaigns building up their brand in Myanmar from a virtual unknown.
Exemplifying their different approaches, Telenor were immediately present on social media and on their website announcing their win.
“We are delighted that Telenor is a winning bidder in what was a highly competitive telecommunications licence tender in Myanmar. We thank the government for giving Telenor the opportunity to support the country in achieving its goals, and for the open and efficient bidding process," said Jon Fredrik Baksaas, President and CEO of Telenor Group on their website.
At the time of reporting, Ooredoo had still not commented on their win.
This has been one of the most competitive international telecom bids in what experts regard as one of the last mobile frontiers. Myanmar promises huge growth in its fledgling telecommunication sector as currently only 10 percent of the population have access to cellphones.
However, both Ooredoo and Telenor will have to invest considerable sums in infrastructure to begin providing nation-wide networks. They will also be competing with two government-owned companies who currently dominate the mobile market.
Only yesterday, Myanmar's Parliament attempted to postpone the announcement until after a telecommunications bill was passed which will define a legal and regulatory framework for the sector.
These are only some of the challenges ahead in the new race to expand Myanmar's mobile market.
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