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Sri Lanka - Telecoms, Mobile, Broadband and Forecasts

  • October 2014
  • -
  • Paul Budde Communication Pty Ltd
  • -
  • 87 pages

As Sri Lanka's mobile market passes 100% subscriber penetration, operators launch 4G services
With the end of the civil war in 2009 Sri Lanka entered what is referred to as a ‘post-conflict' phase. There were positive signs of a general improvement in the country's social and economic well-being by 2013/2014. And, although still facing challenges, the telecom sector in particular was starting to enter a new development phase.
Over the past few years the Sri Lankan economy has rebounded from the difficult state it was experiencing back in 2009. The country had been hit by a balance of payments crisis in that year and needed a US$2.6 billion IMF loan to bail it out. Since then, however, the US$65 billion economy has been reporting strong economic growth – more than 7% GDP growth in 2013 - and the unemployment rate had hit a record low. The IMF forecast annual growth of 6%-7% in the short term.

The generally improving market environment has seen the country's telecom sector well positioned for continuing vigorous growth. The already modern and progressive telecommunications sector is certainly high on the list of priorities for further expansion and development. This also fits well with the government's wider agenda for national development. The government has been promoting such initiatives as the e-Sri Lanka project. It has also established the National Broadband Consultative Committee (NBCC), a special committee appointed to accelerate and promote the availability of affordable high speed broadband internet in the country.
A good start has been made on expansion and provision of infrastructure that is capable of providing a sophisticated level of telecommunications service to the population throughout the whole country. Extending infrastructure into the North and Eastern provinces, those parts of the country most affected by the long-running war has been given high priority. It is well recognised that the growth and development of any country's telecom sector is necessary to provide, among other things, an impetus for national economic activity. Nevertheless, much still needs to be done to complete the build-out of the necessary national infrastructure.

After a five-year period of strong growth the fixed-line subscriber market flattened out and then entered into a decline. Considerable uncertainty hangs over this segment of the telecom market. The widespread application of the Wireless Local Loop (WLL) platform was for some time a positive element in this struggling sector. However, even the WLL subscriber numbers are now in decline. There is also large concentration of fixed services in the capital Colombo (penetration of 35%) which makes the national figure look better than it is.

In the meantime, the country's mobile telephone services have continued on a positive growth path. (The subscriber numbers appeared to have experienced a ‘correction' in the first half of 2013 with the full year delivering zero growth.) As an effective and efficient alternative to the fixed-line networks, the mobile phone quickly became a popular and essential service. The Sri Lankan mobile market was still growing at an annual rate of around 50% in 2009 in as it headed towards the 60% penetration mark. However, since then subscriber growth has moderated to less than 10% per annum. The country's four competing mobile operators – Dialog Axiata, Mobitel, Etisalat Sri Lanka and Hutchison Lanka – have been joined by a fifth operator, Bharti Airtel Lanka, adding vigour to an already highly competitive market. (A move by Mobitel to acquire Hutchison Lanka in 2013/2014 had not proceeded as it could not gain regulatory approval.) In 2013, first Dialog and then Mobitel launched Fourth Generation (4G) LTE services in a move that effectively lifted the countries standing as a telecom market in the region.

The development of the internet remains of particular concern for Sri Lanka. In a country whose population is increasingly undeniably internet savvy and the government rhetoric positively supporting the nation going online, the estimated user penetration remained relatively low coming into 2014. Despite signs of an enthusiastic user market, coverage and accessibility have continued to be limited and the sophistication of the available services generally low. The level of broadband access has been of particular concern. By 2013/2014, however, fixed broadband internet services were being supplemented by a rapidly expanding mobile broadband segment.

Market highlights:

Sri Lanka's mobile market passed the 100% subscriber penetration milestone in early 2014;
Mobile subscriber numbers had increased fourfold in just six years;
After the leading mobile operators – Dialog and Mobitel - trialled their Fourth Generation (4G) LTE technologies in 2012, both initiated commercial launches of 4G services in 2013;
After a sustained period of healthy growth, the country's fixed-line market had undergone a levelling off and suffered a significant decline in 2012/2013;
Fixed-line expansion had been boosted by the extensive application of CDMA-based WLL technology;
The number of WLL services peaked, however, in 2010/2011, and had been falling since then;
The country's internet sector remained underdeveloped, with the take up rate of broadband services being especially low; there were positive signs, however, that this was starting to change, especially with the surge in mobile broadband services;
Fixed broadband penetration (as a percentage of population) was still less than 3% in early 2014;
The government established the National Broadband Consultative Committee (NBCC) in 2010, but there was little evidence of it having any great impact to date;
The ‘e-Sri Lanka' project was continuing to be supported by government.

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

Table Of Contents

Sri Lanka - Telecoms, Mobile, Broadband and Forecasts
1. Key Statistics
1.1 Country Overview
1.1.1 Background
1.1.2 Economy
2. Telecommunications Market
2.1 Overview
2.2 World Bank-Dialog Axiata training initiative
2.3 Background to development
3. Regulatory Environment
3.1 Telecommunications Regulatory Commission (TRC)
3.2 National Policy on Telecommunications
3.2.1 Adoption in 1998
3.2.2 The years 2001-2005
3.2.3 Proposed Ten Year Development Plan (2006-2016)
3.3 Historical overview
3.3.1 Convergence Act
3.4 Deregulation
3.4.1 Background
3.4.2 EGO Licences International licences
3.4.3 International Traffic Bypass Control rules
3.5 Licences
3.6 Regulatory developments
3.7 Privatisation
3.7.1 SLT
4. Fixed Network Operators
4.1 Overview of operators
4.2 SLT (formerly Sri Lanka Telecom)
4.2.1 Company overview
4.2.2 Financial overview
4.2.3 Privatisation and ownership of SLT
4.2.4 Mobitel
4.2.5 IPTV
4.2.6 WLL
4.2.7 National and international networks
4.3 Suntel
4.3.1 Overview
4.3.2 Network roll-out and operations
4.3.3 Acquisition by Dialog Axiata
4.4 Lanka Bell
4.5 Dialog Broadband Networks (DBN)
4.6 Other operators
5. Telecommunications Infrastructure
5.1 Overview
5.2 National telecom network
5.3 Fixed-line statistics
5.4 Infrastructure development
5.4.1 STL's role
5.4.2 Wireless Local Loop (WLL)
5.4.3 Fibre optic networks
5.4.4 National Backbone Network (NBN)
5.4.5 Payphones
5.4.6 Numbering plan
5.4.7 Internet Protocol (IP) networks
5.5 International infrastructure
6. Internet Market
6.1 Overview
6.2 Internet statistics
6.3 Internet control and censorship
6.4 Internet exchange
6.5 Public internet access
6.6 School Net project
6.7 Lanka Government Cloud (LGC)
6.8 e-Sri Lanka
6.9 ISP market
6.9.1 SLTNet
6.9.2 Suntel wOw
6.9.3 BellNet
6.9.4 Wishya Online (Pvt) Ltd
6.9.5 ITMIN Ltd
6.9.6 Eureka Online (Pvt) Ltd
6.10 E-commerce
6.11 E-government
7. Broadband Market
7.1 Overview
7.1.1 National Broadband Consultative Committee (NBCC)
7.1.2 Broadband monitoring
7.2 Broadband statistics
7.3 Digital Subscriber Line (DSL)
7.4 Wireless broadband/WiMAX
7.5 Fibre to the Building (FttB)
7.6 Internet Protocol TV (IPTV)
8. Digital Media / Digital Economy
8.1 Broadcasting
8.1.1 Market overview
8.1.2 Regulatory environment
8.1.3 Internet Protocol TV (IPTV)
8.1.4 Cable and pay TV
8.1.5 Free-to-Air (FTA) TV
9. Mobile Communications
9.1 Overview of Sri Lanka's mobile market
9.2 Mobile statistics
9.3 Third Generation (3G) mobile
9.3.1 Background
9.3.2 Licences and service launch
9.3.3 Development of 3G
9.4 Fourth Generation (4G) / Long Term Evolution (LTE)
9.5 M-banking
9.6 Major mobile operators
9.6.1 Dialog Axiata (formerly Dialog Telekom)
9.6.2 Mobitel
9.6.3 Etisalat Sri Lanka
9.6.4 Hutchison Lanka
9.6.5 Bharti Airtel Lanka
9.6.6 Satellite mobile
10. Forecasts
10.1 Forecasts fixed-line market 2015; 2020
10.2 Forecasts Internet services 2015; 2020
10.3 Forecasts mobile services 2015; 2020
Table 1 Country statistics Sri Lanka 2014
Table 2 Telephone network statistics March 2014
Table 3 Internet user statistics 2013
Table 4 Mobile statistics March 2014
Table 5 National telecommunications authorities
Table 6 Sri Lanka's real GDP growth rate 2006 - 2015
Table 7 National network status March 2014
Table 8 Number of telecom operator licences by category March 2014
Table 9 Fixed-line operators and subscribers 2010 - 2013
Table 10 SLT fixed-line subscribers and market share 1999 - 2013
Table 11 SLT fixed-line subscribers wireline and WLL 2005 - 2013
Table 12 SLT (Sky Network) broadband subscribers 2009 - 2013
Table 13 Historical - Suntel subscribers 1999 - 2012
Table 14 Lanka Bell subscribers 1999 - 2013
Table 15 DBN subscribers 2008 - 2013
Table 16 Fixed lines in service, annual change and teledensity 1995 - 2014
Table 17 Fixed subscribers wireline and wireless (WLL) - 2009 - 2014
Table 18 WLL subscribers 1996 - 2014
Table 19 Internet users, annual change and penetration 1996 - 2014
Table 20 Fixed internet subscribers 1994 - 2014
Table 21 Computer penetration by household 2005 - 2014
Table 22 International internet bandwidth 1998 - 2014
Table 23 SLT's DSL broadband subscribers 2005 - 2013
Table 24 Fixed broadband subscribers and penetration 2002 - 2014
Table 25 DSL subscribers 2003 - 2013
Table 26 Mobile broadband subscribers 2009 - 2014
Table 27 Broadband subscribers fixed and mobile 2010 - 2014
Table 28 Broadband subscribers and households March 2014
Table 29 Key broadcasting statistics 2013
Table 30 SLT's PeoTV subscribers 2009 - 2013
Table 31 DTV's DTH subscribers 2008 - 2013
Table 32 Mobile subscribers, annual change and penetration 1995 - 2014
Table 33 Mobile operator market share based on subscribers 2013
Table 34 Mobile operators, subscribers and annual change 2013
Table 35 Mobile broadband subscribers 2009 - 2014
Table 36 3G mobile operators and subscribers 2009; 2013
Table 37 Dialog Axiata subscribers and market share 2004 - 2014
Table 38 Dialog Axiata prepaid subscribers 2004 - 2014
Table 39 Dialog Axiata ARPU postpaid, prepaid and blended 2007 - 2014
Table 40 Dialog Axiata: 3G mobile subscribers 2012 - 2013
Table 41 Mobitel subscribers and market share 2004 - 2013
Table 42 Mobitel: 3G mobile subscribers 2012 - 2013
Table 43 Etisalat Sri Lanka subscribers - 2004 - 2013
Table 44 Etisalat: 3G mobile subscribers 2012 - 2013
Table 45 Hutchison Lanka subscribers and market share 2006 - 2013
Table 46 Hutchison: 3G mobile subscribers 2012 - 2013
Table 47 Bharti Airtel Lanka subscribers and market share 2009 - 2013
Table 48 Bharti Airtel: 3G mobile subscribers 2012 - 2013
Table 49 Forecast fixed line subscribers and penetration rate 2015; 2020
Table 50 Forecast fixed internet subscribers and penetration rate 2015; 2020
Table 51 Forecast mobile subscribers and penetration rate 2015; 2020
Chart 1 - Fixed-line operators and subscribers - 2010 - 2013
Chart 2 - SLT fixed-line subscribers and market share - 2003-2013
Chart 3 - SLT fixed-line subscribers - wireline and WLL - 2005-2013
Chart 4 - Fixed lines in service and annual change 2000 - 2014
Chart 5 - Fixed subscribers - wireline and WLL - 2009-2014
Chart 6 - Internet users 2003 2014
Chart 7 - Internet subscribers 2000 - 2014
Chart 8 - SLT's DSL broadband subscribers 2005 2013
Chart 9 - Fixed broadband subscribers and penetration 2005 2014
Chart 10 DSL subscribers 2005-2013
Chart 11 - Mobile subscribers and annual change 2000 2014
Chart 12 - Mobile operator market share - 2013
Chart 13 - Dialog Axiata subscribers and market share - 2004-2014
Chart 14 - Dialog Axiata prepaid subscribers - 2004-2014
Chart 15 - Mobitel subscribers and market share - 2005-2013
Chart 16 - Estisalat Sri Lanka subscribers 2005 - 2013
Exhibit 1 Telecommunications system operator licensees
Exhibit 2 Major shareholders in SLT December 2013
Exhibit 3 Licensed Internet Service Providers (ISPs) 2010
Exhibit 4 Licensed Data Communications Service Providers (Facility-based) February 2011
Exhibit 5 Licensed Data Communications Service Providers (Non-Facility based) February 2011
Exhibit 6 Special rural subscriber tariffs

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ref:plp2014

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