Sri Lanka Mobile Boom Overtakes TV & Radio

2nd January 2012, www.lankabusinessonline.com

Household access to telephones is on par with electricity, television, and radio in Sri Lanka mainly because of the boom in mobile phones, and are set to overtake TV and radio, a new study said.

Access to household phones is greater than to transport in the island, the study of Asian countries by the LIRNEasia think tank said.

SMS (short message service) use, gaming and balance checking has decreased but camera and radio use increased in Sri Lanka from 2008 to 2011, said the study on use of information communications technology, mostly phones, among poor people in emerging Asian economies.

It covered Bangladesh, Pakistan , India, Sri Lanka, Indonesia (Java), Philippines and Thailand.

Access to phones is improving on both personal and household levels, mostly of mobiles with a decline in fixed and public phones, the study said.


And phones are set to overtake TV and radio, it said.

It found that phone use in rural Sri Lanka is on par with urban areas.

The main perceived benefits of phone access in Sri Lanka are emergency communication, maintaining relations and saving on travel.

"The key economic benefit of phones is reducing travel," it said, noting that there was little use of mobiles for productive purposes.

About 71 percent of poor consumers, in a segment known as BOP or bottom-of-the-pyramid, own a mobile with many on a second handset, the study found.

"Multiple-SIM ownership is high in the north and east. The main reason is because of lower call rates.

Cheaper 'on-net' or the same network calls were the main reason for multiple ownership of SIMs or subscriber identity modules used to identify and authenticate subscribers.

Related Info :

• Sri Lanka Telephone Density Reaches 100.8 Lines per 100 Persons in 2010 as Fixed & Mobile Connections Overtake Population

ITU Highlights Sri Lanka's World's Fastest Telecom Affordability Gains

27th June 2011, www.lankabusinessonline.com

Sri Lanka is among the top three countries in the world to see a sharp increase in telecom services affordability, a study by the International Telecommunications Union, a UN affiliated body has shown.

ITU's 2010 ICT Price Basket, measures the change in costs of mobile, fixed and fixed broadband services relative to per person gross national product, from 2008.

South Asian countries of Bhutan, Sri Lanka and Bangladesh were among countries to see the sharpest rise in affordability. Relative costs fell 67.4 percent in 2010 from two years ago in Sri Lanka, behind 75.4 percent for Bhutan and ahead of Bangladesh's 65.2 percent.

Azerbaijan saw the steepest price fall measured by the basket at 81.7 percent.

Consumers worldwide were paying on average 18 percent less for ICT services than two years ago, with broadband prices falling 50 percent. Mobile costs have fallen 22 percent and fixed telephony 7 percent.

As a region, the largest price drops were in Africa, but the countries had high prices to begin with, ITU said. In Africa fixed broadband prices had fallen 55 percent and cellular prices 25 percent.

But in Africa fixed broadband was still three times the monthly average per person GNP and was "prohibitively high", the ITU said.

In developing countries fixed broadband service costs had dropped 52 percent, compared to 35 percent in developed countries.

Small economies with high per person gross national income, such as Monaco, Macao, Liechtenstein, Hong Kong (China) and Singapore topped the ICT Price Basket.

In many developed nations ICT costs were one percent of per person national product, compared to 17 percent from developing countries.

Related Info :

• Sri Lankan Telcos Deliver Faster Broadband. SLT & Dialog Launch 4G as Etisalat Introduces 3.75G

• Sri Lanka Mobile Users Grow by 25.4pct to 15.86mn While Wireline Use Go Down

Sri Lanka Introduces Bus Ticket Booking Via Mobiles

21st June 2011, www.dailynews.lk

The National Transport Commission together with Dialog Axiata present the future of public transportation services in Sri Lanka with the introduction of the Mobile Bus Ticketing facility, allowing passengers to pre-book and purchase tickets through the mobile phone.

This innovative new service is implemented under the purview of the National Transport Commission, and seats could be reserved through this system on private transport buses plying identified long-haul routes. Colombo - Badulla, Colombo - Ampara and Colombo - Kataragama are the routes available with this service at the outset, and this would be extended to other long distance routes islandwide in the nearterm.

"The use of technology to enhance the passenger transport experience is a significant step in our national development drive as espoused in the Mahinda Chinthana. This effort will increase passenger convenience, and I'm pleased to have given lead to a programme of this manner.

There will no doubt be numerous challenges, but the National Transport Commission together with Dialog will be able to overcome these," Private Transport Minister C B Rathnayake," stated.

Speaking at the launch ceremony, Dialog Axiata Group Chief Executive, Dr. Hans Wijayasuriya, said: "Dialog strives constantly to empower every aspect of Sri Lankan life, and we acknowledge the commitment and encouragement received by the

minister and his staff to make the convergence of technology into the transportation sectors a reality."

Related Info :

• Second Phase of mTicketing Launched by Sri Lanka Railways & Mobitel. Subscribers Dial 365 to Access Ticketing Portal

Sri Lanka Dialog Makes Rs1.2bn Net Profit in March 2011 Quarter with Subscriber Growth

12th May 2011, www.lankabusinessonline.com

Sri Lankan mobile phone operator Dialog Axiata group said March 2011 net profit rose 64 percent to 1.2 billion rupees from a year ago with subscribers growing and lower losses from TV and broadband units.

The profit was slightly lower than the 1.3 billion rupee net profit made in the December 2010 quarter.

Dialog said in a stock exchange filing group sales for the March 2011 quarter rose 10 percent to 10.9 billion rupees from the previous year.

Basic earnings per share for the quarter rose to 14 cents from eight cents.

Dialog Axiata's cellular business operating profit fell to 869 million rupees from 1.4 billion rupees the previous year.

The group's television business reduced operating losses to 28 million rupees from 126 million rupees while its fixed telecommunication service loss fell to 204 million rupees from 294 million rupees.

The group's telecommunication infrastructure operations mad a 101 million rupees operating profit during the March 2011 quarter compared with a loss of 76 million rupees the year before.

Operating profit from the group's international operations rose to 386 million rupees from 49 million rupees.

"Group profitability was founded on a healthy momentum in EBITDA growth of seven percent, founded on the positive outcomes of strategic cost rescaling in combine with revenue gains," a company statement said.

"Judicious balance sheet restructuring initiatives featuring the achievement of a lower cost debt profile has underpinned the translation of EBITDA performance to commensurate growth in net profit at group, company and subsidiary levels."

Dialog said growth in mobile revenues was driven by a "healthy growth" in mobile subscribers to more than 07 million in the March 2011 quarter and the "increased adoption of mobile broadband services."

Company revenues were further bolstered through interconnection revenues of 0.4 billion rupees accruing since the implementation of the interconnection regime in June 2010.

However, Dialog said that notwithstanding a 10 percent growth in revenues, EBITDA at company level contracted by two percent to 3.3 billion rupees in the March 2011 quarter from a year ago.

"The company’s operating costs (excluding depreciation) grew by 17 percent compared to the first quarter of 2010," the statement said.

"International origination costs and domestic interconnection charges grew in tandem with the growth in corresponding revenue lines and formed a significant contributor (65 percent) to year-on-year cost expansion."

Dialog's network costs increased by 18 percent in tandem with the "aggressive expansion" of the company’s network infrastructure footprint and price hikes with respect to key inputs including electricity and fuel, the statement said.

The performance of the Dialog Television and Dialog Broadband Networks units continues to improve, the company said.

DTV revenue rose 15 percent to 561 million rupees in the March 2011 quarter from a year ago with its pay television business adding 13,000 new customers to reach a subscriber base of over 181,000 as at 31 March 2011.

"DBN continued to consolidate the performance trends of the previous quarters to record its fourth successive quarter of positive EBITDA in Q1 2011," the statement said.

"EBITDA turnaround at DBN was underpinned by substantial reductions in operating and direct costs accruing from cost rescaling programmes implemented over the past quarters."

DBN remained in the red in the wake of accelerated depreciation of its CDMA and WiMAX networks.

"The group continued to record positive Free Cash Flows (FCF) for the fifth consecutive quarter, with Q1 2011 FCF being recorded at 1.1 billion rupees," the Dialog statement said.

Dialog also said recently launched its 4th Generation LTE pilot network in Colombo to prepare its network capability for the next generation in high speed broadband services.

"The pilot network will initially cover several key zones within the city and is billed to be the first exposition of a 4th Generation LTE network in the South Asian region.

"The pilot network has demonstrated the delivery of over 100 Mbps in indoor demonstration mode and 40–50Mbps under outdoor mobile conditions."

Related Info :

• Sri Lanka Dialog Invests $150mn on Fibre & Broadband Network Expansion

• Sri Lankan Telcos Deliver Faster Broadband. SLT & Dialog Launch 4G as Etisalat Introduces 3.75G

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Sri Lanka Telco Mobitel Invests $60mn on LTE, the Latest Standard in Mobile Network Technology

01st May 2011, www.thebottomline.lk

Sri Lanka Telecom Mobitel, the National Mobile Telecom Service Provider, announced on Friday that it has signed a BOI agreement to trial and deploy a LTE (Long Term Evolution) Network for the first time in Sri Lanka.

This will be part of the company’s network expansion project and will enable Mobitel to import/purchase (locally) project-related items free of customs duty.

Mobitel has committed an investment of approximately US$ 60m in its latest network expansion, adding 1000 LTE capable radio base stations to the existing network infrastructure.

With this, the company’s investments committed to date in its LTE/3.5G/2.5G networks and service offerings amount to over US$ 400m.

“Technology change is a key determinant of a country’s economic growth and therefore, the introduction of LTE Network is expected to drive growth in the telecommunication sector as well as improve competitiveness and growth in several other economic sectors heavily depended on infocom” said, Jayampathi Bandaranayake, Chairman BOI of Sri Lanka. “We are happy to support Sri Lanka Telecom Mobitel in its endeavour to provide the latest ICT technologies which is sure to catalyze national development”.

LTE is the latest standard in the mobile network technology evolution after GSM/EDGE and 3.5G/HSPA network technologies, and Mobitel is gearing towards demonstrating broadband speeds nearing 100Mbps in downlink and 50Mbps in uplink, using this LTE technology when the spectrum is available.

Anusha Palpita, the Director General of Telecommunications said “TRCSL is committed to assist all the telecommunication operators in Sri Lanka to develop world-class telecommunication network facilities in the country. The spectrum allocation for the commercial operation of LTE will soon be finalised where the operators will be able to launch nationwide enhanced ICT infrastructure to benefit all businesses and consumers in Sri Lanka through this latest evolution in mobile broadband technology.”

Nimal Welgama, Chairman Sri Lanka Telecom Mobitel said, “Harnessing the power of ICT to its fullest potential will be the key in realising hyper exponential pace of growth which is needed to build our nation and to do so rapidly. This requires next generation ICT available and affordable to the citizens of our country which will help eventually realise the President’s vision of elevating the e-literacy rate in Sri Lanka. In this regard, this investment on the latest LTE infrastructure will be a significant step towards driving unparalleled growth to propel our country forward.”

ZTE corporation of China was selected by Mobitel as its technology partner to deploy this state-of-the-art LTE ready Next-Generation-Network.

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• Second Phase of mTicketing Launched by Sri Lanka Railways & Mobitel. Subscribers Dial 365 to Access Ticketing Portal

Sri Lanka Telephone Density Reaches 100.8 Lines per 100 Persons in 2010 as Fixed & Mobile Connections Overtake Population

20th April 2011, www.lankabusinessonline.com

Sri Lanka's telephone density rose to 100.8 lines per 100 persons in 2010 showing that fixed and mobile connections had overtaken the population, in a telling demonstration of the results of ending a state monopoly.



Telephone density rose from 86.6 in 2009 in a country with a population of 20.6 million, according to data published by Sri Lanka's central bank.

Mobile phone users grew 20.9 percent to 17.2 million while fixed access wireline which has slumped in 2009 recovered to grow 2.9 percent to 897,000.

Industry analysts say owners of more than one mobile subscriber identity module (SIM) is growing.

Wireless fixed access phones grew 4.3 percent to 2,674,000.

Sri Lanka's telekom market was a state monopoly until the mid 1990s when a privatization and liberalization drive was launched. Sri Lanka Telekom, a state fixed wireless operator was sold to Japan's NTT and two wireless operators were licensed.

At the same time arbitrary pricing was replaced by a regulated tariff re-balancing plan where local calls were raised progressively to allow the fixed operator to deal with lower termination revenue in a global environment of de-regulation.

Prices have since stabilized and have even fallen in some areas in real terms.
Mobile services, which originated as a private business with Millicom International Cellular starting South Asia's first mobile network saw competition, when Australia's Telia started a joint venture with the incumbent fixed operator.

Sri Lanka now has five mobile firms, in a fiercely competitive market.

Another recent growth sector has been broadband both in mobile and wireline. A key reason for the expansion in the wireline sector has been broadband data.

Data showed that internet connections including mobile broadband had grown 79.2 percent to 430,000 in 2010.

Meanwhile payphones in service fell 4.4 percent to 7,054.

The data also showed that mail use has declined. Letters per inhabitant had fallen to 17 from 20 a year earlier.

Related Info :

• Sri Lanka Mobile & Wireline Users Grew by 24pct in Q3 2010

Bharti Airtel Unveils Its New Global Identity in Sri Lanka. First Indian Brand to Go Truly Global

29th Novmber 2010, www.dailymirror.lk

Bharti airtel Lanka, a subsidiary of Bharti airtel, a leading global telecommunications company with operations in 19 countries across Asia and Africa, today unveiled its new global identity in Sri Lanka, following the successful international campaign that commenced in India recently.

The youthful expression of airtel's new identity provides refreshing vitality to global audiences across 2 continents and over 200 million customers. In Sri Lanka, by re-inventing itself in line with the international brand, airtel continues to pioneer quality and reliability of service, breakthrough innovations and unparalleled affordability. Today airtel has emerged as Sri Lanka's fastest growing mobile service provider, delivering an islandwide network in less than 2 years since launch.

Sunil Bharti Mittal, Chairman and Managing Director, Bharti airtel, said "As we race to meet the emerging needs of customers, the unification of our new brand identity across Asia and Africa will enable us to optimize the benefits of a shared worldwide network. Additionally, the new brand identity also gives us the opportunity to present a single, powerful and unified face to our customers, stakeholders and partners around the world.

I believe that this combined scale of efficiencies will support our goal of bringing customers closer to what they truly love in terms of access, device or content".

Amali Nanayakkara, CEO & MD, Bharti airtel Lanka, said "Beyond its positioning as the fastest expanding network in the country, the new international stature of airtel provides unique opportunity to experience a truly global network in Sri Lanka. Coupled together with an unmatchable combination of dynamism, youthful vigour and a pioneering spirit that has already captured the imagination of millions world over, airtel is poised to win the hearts of all Sri Lankans and contribute to its vibrant journey of emerging as one of the most admired brands of the continent".

The new face of airtel is youthful, international, inclusive and dynamic - representing the journey of the first Indian brand to go truly global. The new identity underlines airtel's willingness to embrace everything that is new. The red colour, which is an integral part of the brand, continues to represent the energy and dynamism that has made airtel the success it is today. The new curved addition to the logo is a symbol which will help ensure instant recognition across diverse international markets.

The airtel signature tune has also been refreshed by A R Rahman making it youthful and dynamic in line with the new visual identity. Like the earlier tune, which has made history as world's most downloaded mobile music with over 150 million downloads, the maestro has once again delivered a master piece. The new tune retains the essence of the original but uses an inspiring musical style, with a universal appeal, that will be loved by listeners the world over.

Bharti airtel Limited is a leading global telecommunications company with operations in 19 countries across Asia and Africa. The company offers mobile voice & data services, fixed line, high speed broadband, IPTV, DTH, turnkey telecom solutions for enterprises and national & international long distance services to carriers. Bharti airtel has been ranked among the six best performing technology companies in the world by BusinessWeek. Bharti airtel had 200 million customers across its operations.

Bharti Airtel Lanka (Pvt) Ltd commenced commercial operations of services on January 12, 2009, and now has an aggregate of over 1 million customers. Granted a license in 2007, in accordance with the Sri Lanka Telecommunications Act No. 25 of 1991, it is also a registered company under the Board of Investment in Sri Lanka. Under the license, the company provides digital mobile services to Sri Lanka inclusive of voice telephony, voice mail, data services and GSM based services. All of these services are provided under the Airtel brand.

Sri Lanka Mobile & Wireline Users Grew by 24pct in Q3 2010

29th November 2010, www.lbo.lk

Sri Lanka's mobile subscribers grew 24.3 percent in the third quarter of 2010 from a year earlier, while fixed access sector grew at a much slower 3.4 percent, official data show. During the past 12 months 3.2 million mobile users have been added according to data released by the Central Bank bringing the total to 16.62 million.

Sri Lanka only has a population of 20 million people, but with five operators competing in the market some people now own multiple subscriber indentify modules (SIM).

By owning multiple SIMs, cost conscious subscribers can get the benefits of different packages.

The government recently said it will limit SIM ownership to five per person, though the exact logic behind the move is not clear.

Wireline users grew by 19,917 to 889,077 in the third quarter, from a year earlier.

Internet and wireless subscribers grew by a steep 50 percent to 360,000 adding 120,000 new subscribers.

Sri Lanka Telecom, the island's only wireline operator said said earlier its broadband users topped 200,000 in the third quarter.

Fixed wireless users grew 3.8 percent (98,177) to 2.65 million.

Related Info:
Sri Lanka Mobile Users Grow by 25.4pct to 15.86mn While Wireline Use Go Down

Sri Lanka Mobile Use Grows 30pct in 1st Quarter

Double-Digit Mobile Growth in South Asia : World Bank

Dialog Posts Net Profit of Rs 1.69bn for 3rd Quarter of 2010

28th October 2010, www.dailynews.lk

Dialog Axiata PLC announced financial results for the nine months ended September 30, 2010.

Financial results included those of Dialog Axiata PLC and of the Dialog Axiata Group post consolidation with subsidiaries Dialog Broadband Networks and Dialog Television.

The Group posted a robust net profit after tax (NPAT) of Rs 1.69 billion for the third quarter of 2010 taking YTD 2010 NPAT for the first nine months to Rs 3.77 billion, a 138 percent increase YoY.

Group profit was underpinned by robust performance at Company level, with Dialog Axiata PLC featuring the Group's mobile business, posting a Q3 and nine months profit of Rs 1.90 billion and Rs 4.99 billion respectively, up 162 percent YoY.

Subsidiaries DTV and DBN delivered robust growth in terms of enhanced profitability at Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and NPAT levels.

Enhanced profitability at subsidiary level was underpinned by significant performance improvements in the Fixed Line, Broadband, and Television businesses of the Group. On an adjacent QoQ basis EBITDA (positive) and NPAT (negative) improved by 173 percent and 48 percent for DTV and 432 percent and 57 percent for DBN respectively.

Dialog Group revenues were recorded at Rs 30.67 billion for the nine months ended September 30, 2010, up 16 percent YoY and 4 percent QoQ.

Similar growth was delivered in terms of Group EBITDA which was recorded at Rs 11,151 million, up 5 percent QoQ and 74 percent YoY. The Group EBITDA margin improved by 12 percentage points YoY, to reach 36 percent. The positive growth trajectory in terms of EBITDA underpinned robust growth in Group NPAT of 138 percent YoY and 23 percent QoQ.

Driven by robust performance in the mobile market, the company recorded revenues of Rs 9,671 million in Q3 2010 and Rs 28,068 million for the first nine months.

Company revenue grew by 16 percent compared to the first nine months of 2009 and 4 percent relative to the previous quarter.

Dialog's Mobile subscriber base stood at 6.7 million as at end of September 2010, recording a 6 percent growth YoY.

The third Quarter of 2010 featured the transient impact of downward tariff adjustments in the mobile market, immediately following the introduction of floor rate regulations in July 2010.

Accordingly, Core Mobile revenues (excluding interconnection income) which exhibited 13 percent growth YoY, declined marginally by 1.5 percent on an adjacent QoQ basis. Notwithstanding the transient impact of tariff adjustments across the sector, total revenues were bolstered by increased consumption of mobile voice and mobile broadband services, as well by interconnection income, resulting overall in a 4 percent growth in revenue on an adjacent QoQ basis.

Sri Lanka Farmers Earn a Premium for Produce by Mobile Use

27th October 2010, www.lankabusinessonline.com

Use of mobile phones has helped Sri Lankan farmers get better prices for their produce and the technology can help reduce poverty, according to a new United Nations study, officials said.

"There is an informational dimension to poverty - poor people need lots of information for their livelihoods such as on market prices, inputs, weather," said Sriganesh Lokanathan of LIRNEasia, a think tank which helped prepare the report by United Nations Conference on Trade and Development.

A study done by LIRNEasia on small farmers in Dambulla, an agricultural centre in central Sri Lanka, found that 11 percent of their cost of production goes towards information search, "quite a high percentage," Lokanathan said.

"Information communications technologies (ICTs) have a role in trying to bridge this information gap," he told a news conference held to launch the UNCTAD report called 'Information Economy Report 2010: ICTs, Enterprise and Poverty Alleviation'.

"Without it the vulnerability of poor people increases. ICT can give them pertinent information in time and as accurately as possible."

A study by LIRNEasia this year found that farmers with access to 'Tradenet', a local service that gives prices through mobile phones, are able to earn a premium for their produce.

"By just having market price information several times a day they get premium of 23.4 percent on the average price," said Lokanathan. "So there are real impacts ICTs are having."

The increased access to information through mobile phones has enabled farmers to explore cultivation of different crops and to grow higher value ones that increase incomes and get crop advisory services.

Lokanathan said the potential for ICTs like mobile phones to alleviate poverty in the least developing countries was high as in most LDCs half the rural population is not covered.

But he said it was important to ensure such ICTs were affordable and the experience of South Asia, which has the lowest mobile phone rates, could be useful for other countries.

The UNCTAD report suggests encouraging improving mobile coverage in rural areas and making them more affordable, Lokanathan said.

The report focussed on ICT adoption by poor people, or what's known as BOP - bottom of the pyramid.

"More demand-driven intervention is needed. Policymakers need to better understand local needs," he said. "They need to be aware of what works and what does not in the local context."

The UNCTAD report looks at how ICT can be used in enterprises poor people engage in like fishing and farming and how the poor can be involved in the ICT sector itself, such as selling phone reloads.

Related Info:
Dialog Tradenet - Agricultural Produce Price Information in Sinhala

Sri Lanka Mobile Users Grow by 25.4pct to 15.86mn While Wireline Use Go Down

04th October 2010, www.lankabusinessonline.com

Sri Lanka's mobile subscribers grew 25.4 percent to 15.86 million in the second quarter of 2010 from a year earlier and a wireline contraction has bottomed out, official data shows.

At the end of the second quarter of 2010 Sri Lanka had 15.86 million mobile users up from 11.49 million a year earlier.

Mobile users grew 5.1 percent from the first quarter figure of 15.04 million, according to data released by the Central Bank.

Sri Lanka's regulator imposed floor prices on mobiles after intense price competition and an economic downturn pushed operators into losses. But operators had become leaner during the period.

Wireline users, sold mainly by Sri Lanka Telecom, a affiliate of Malaysia's UT group grew 1.0 percent to 879,690 in the second quarter from a year earlier. Users were up from the first quarter number of 875,509. In the first quarter of 2010 users fell to 875,509.

Fixed wireless users grew 3.8 percent to 2.61 million in the second quarter from a year earlier. Total fixed users grew 3.1 percent to 3.4 million.

Internet and email connections grew 8.3 percent to 260,000 in the second quarter from a year earlier.

Sri Lanka Mobile Phone Payment System in Place by Year End

02nd September 2010, www.dailynews.lk, By Charumini De Silva

The Central Bank hopes to introduce mobile phone payment systems to Sri Lanka by the end of this year. The Central Bank has drafted the guidelines for mobile phone payment systems and called for public comments.

The guidelines are issued with the aim of promoting safety and effectiveness of mobile payment schemes.

These guidelines have been sent to mobile service providers, banking and financial institutions for observation, a senior Central Bank official told Daily News Business.

Through this system account holders are able to operate their own accounts via mobile phones to debit or credit to their own accounts or credit accounts of third parties within the same bank or in another network. The mobile payment system is also a retail payment system, which is much secure, safe and easy. This will support to increase the mobile usage and bank transactions more frequently.

The mobile payment system is also helpful for the rural community where they could access their bank accounts without coming to the city. The Central Bank is taking all measures to ensure the security and the safety of the transactions to build the trust of consumers.

The Central Bank has not yet finalized the prices of the registration fee, but it will be a reasonable amount where all segments of communities can afford.

They also expect a good response from the young generation who are interested in the latest technology.

Sri Lanka's Etisalat Spends $163mn on Expansion and 3G Upgrade

20th July 2010 www.dailymirror.lk

Sri Lanka's Etisalat unit said it was spending 163 million US dollars to expand its network into war ravaged north of the country and improve its broadband services in urban areas.

The expansion will see 480 new base stations taking the total to 1580, which the firm says will be the largest in the island.

"We are investing 163 million US dollars (18.5 billion rupees) to expand base stations and bring HSPA 28.8 megabits per second.

"We are bringing coverage investment, distributed all over the country with special emphasis on the North and the East," chief executive Duminda Ratnayaka said.

Ratnayaka said expansion of its broadband services will see HSPA (high speed packet access) technology with 28.8 megabits per second speeds.

Over 500 third generation (3G) base stations will be built on existing locations.

Alcatel-Lucent has been chosen as the vendor.

UAE-based Etisalat bought the Sri Lanka unit from Millicom Cellular International when it exited Asia.

The firm says the expansion will be funded by debt at 'attractive terms' as the firm was virtually debt free and its parent is rated A+ by Fitch Ratings.
"We are virtually a debt free company,' deputy chief executive Riyaz Rasheed said.

"Given our status as a debt free we have managed to finalize the funding."

The firm said its subscriber base was now close to 3.0 million.

Ratnayaka said a recent floor price set by the regulator was beneficial to "both the consumer and operator."

"The operator has to have a healthy business to ensure that good services are delivered to the consumer," Ratnayaka said.

Sri Lanka's Bharti Airtel unit has petitioned courts over the move. Sri Lanka's 15 million subscriber market is shared between Dialog Axiata, Sri Lanka Telecom Mobitel, Airtel, Hutch and Etisalat.

Sri Lanka Mobile Use Grows 30pct in 1st Quarter

15th July 2010, www.lankabusinessonline.com

Sri Lanka's mobile phone subscribers grew 30 percent to 15.0 million in the first quarter of 2010, while fixed wireless users grew 4.7 percent and wireline users were flat, official data show.

Fixed wireless subscribers grew to 2.58 million users in the first quarter from 2.47 users a year earlier, while wireline subscribers fell 555 to 875,509 telecom data released by the central bank showed.

But wireline users increased from a December quarter low of 871,248 ending a contraction in the category. Wireline is sold only by Sri Lanka Telecom, which is jointly owned by Sri Lanka's government and Malaysia's UT group.

In Sri Lanka wireless access is sold mainly using CDMA technology by Sri Lanka Telecom, Lanka Bell, Suntel and a fixed access unit of the cellc Dialog Axiata.

During 2009 wireline users fell by 17,731, while fixed wireless users only grew by 2,128.

From this week Sri Lanka's telecom regulator has put floor prices of 2.0 rupees a minute for mobile calls and 50 cents for interconnection between networks.
Internet and email subscribers have grown 6.8 percent (16,000) to 250,000 in the first quarter from a year earlier.

Sri Lanka Etisalat unit says to expand 'aggressively'

25th February 2010, www.lankabusinessonline.com

Etisalat's new Sri Lankan mobile subsidiary said it plans to expand coverage to cover the entire island, offer high speed links and use its international group network to give preferential rates to win customers.

"We're here to stay in Sri Lanka," Etisalat group chief marketing officer Essa Al Haddad told a news conference held to announce the launch of services under the new brand.

"As investors and telecom service providers we're here for the long term."

Etisalat, the United Arab Emirates-based telecom firm, acquired 100 percent of the Sri Lanka operation called Tigo from Millicom International in October 2009 and has renamed it Etisalat Lanka.

The celco is the third-largest mobile telephony operator in Sri Lanka with 2.5 million customers and an estimated market share of around 20 percent.

Etisalat Lanka chief executive Dumindra Ratnayaka said the company will set up more base stations to expand coverage throughout the island, including the north and east which are recovering from a war.

The island's 30-year ethnic war ended in May 2009, resulting in an economic revival.

Etisalat Lanka has already have set up eight base stations in the north and will launch operations in the northern Jaffna peninsula on Friday, Ratnayaka told the news conference.

"We will aggressively start rolling out our base stations from March," he said.

"We will roll out 450 2G base stations, mostly in the north and east, to fill any gaps we have, increasing the number of stations to 1,500 in the next six months."

Of the new 2G base stations, 100 will be in the north and east.

The firm will also set up 500 3G base stations offering higher speeds over the same period.

Ratnayaka said the company will also promote its international roaming services making use of the group network which has 100 million subscribers in 18 countries in the Middle East, Asia and Africa.

"Our group presence helps us to give preferential rates, packages and services," Ratnayaka said.

"When roaming within the group network we will offer preferential rates, which will vary from network to network; for instances in some networks incoming calls will be free."

Etisalat Lanka also intends to capture market share by exploiting the presence of Sri Lankan migrant workers in the Middle East.

"The UAE is host to many communities and nationalities including Sri Lankans who have a lot of connections with Sri Lanka," group chief marketing officer Essa Al Haddad said.

He also said Etisalat's ownership of the company will enable it to benefit from economies of scale. "We can provide scale - such as in accessing technical resources and in buying equipment."

Double-Digit Mobile Growth in South Asia : World Bank

06th December 2009, www.nation.lk

The South Asia region has experienced a significant expansion in the reach and use of ICT networks and services over the past decade but still lags behind many other countries in overall ICT performance, say World Bank Group experts convened in Sri Lanka for the South Asia regional launch of Information and Communications for Development 2009: Extending Reach and Increasing Impact (IC4D).

This regular publication of the World Bank Group addresses the critical role that information and communication technologies (ICT) play in economic development. It found that regional improvements in ICT affordability in South Asia have led to 500 million new subscribers accessing telephone services and double digit growth in subscription to mobile telephone in each country in the region since 2004.

Globally, the report found that access to affordable, high quality internet and mobile phone services enables development across all levels of the economy and society. In fact, for every 10 percentage-point increase in high speed Internet connections there is an increase in economic growth of 1.3 percentage points. The report also identifies the mobile platform as the single most powerful way to reach and deliver public and private services to hundreds of millions of people in remote and rural areas across the developing world.

Broadband in particular plays an essential role in providing the basis for local IT services industries, which create youth employment, increase productivity and exports, and promote social inclusion. Report authors say that developing countries should seize this largely untapped opportunity, with less than 15 percent of the potential global market for IT services industries currently being exploited. In 2007, this market represented nearly US$500 billion.

In South Asia, reformed regulatory frameworks in the region now promote competition and private investment in the telecommunications sector. The region has also become a strong player in the global information and innovation economy. While India’s success in the information technology (IT) and IT-enabled services (ITES) sectors is well known, Pakistan and Sri Lanka have also emerged as potential destinations for offshore services. In addition, the use of ICT services continues to deepen, with governments across the region designing and implementing programmes to both automate and transform public service delivery.

However, more needs to be done to realise the development impact of ICT in the region. The report gave each of the South Asian countries scores of 3 or 4 on a scale of 1-10 in overall ICT performance, a measure that includes access, affordability, and adoption. This is because more advanced ICT services such as the Internet and converged services are not yet widely available compared to other regions. Given the low income levels in South Asia, there is still room to improve affordability and expand the addressable market. The use of ICT by governments and in businesses will have to deepen to have a lasting impact on improved transparency and service delivery.

“These technologies offer tremendous opportunities. Governments can work with the private sector to accelerate rollout of broadband networks, and to extend access to low-income consumers,” says Mohsen Khalil, World Bank Group Director for Global Information and Communication Technologies. “Governments should proactively encourage the development of local IT services industries through policies and incentives directed at entrepreneurs and the private sector, and through investments in skills and infrastructure.”

“Access to broadband completes the information foundation for a modern economy and should be a priority in national development plans.” says Katherine Sierra, World Bank Vice President for Sustainable Development. “Governments can play a key role in expanding broadband access by policies and incentives that encourage competition and private investment, she added.”

Sri Lankan Farmers Share market info on Mobiles

30h Novembr 2009, www.individual.com

A trial Sri Lankan commodity trade matching portal using mobile phones to improve marketing of farmer produce will need private sector investment to be sustainable, an official said.

Chitranganie Mubarak, a Senior Programme Head of the Information Communications Technology Agency (ICTA), said the project is part of efforts to use mobile phone and information technology to link farmers with markets.

A high proportion of farm produce in the island goes waste owing to poor post-harvest processing as well as marketing links.

Mubarak said the trial service, at present free for farmers, uses SMS (short message service) to enable farmers to link up with buyers.

Buyers and sellers must register on the SMS-enabled commodity trade matching portal.

"The system matches the farmer or seller with the buyers. Farmers can send an SMS with what they have to sell, giving their location. If a buyer also wants the same thing the portal will do the matching," Mubarak said.

The transaction is done off-line.

The system is on trial in the hill country Nuwara Eliya district through Sarvodaya, a non-governmental organisation.

"You need only a simple mobile phone to send SMS which most farmers have," said Mubarak.

Farmers have been given codes for different types of agricultural produce as well as phones under the project, funded by the ICTA's 'e-Society' project aimed at spreading the benefits of ICT.

The agency gives grants to organisations to come up with innovative applications which benefit remote rural communities.

Mubarak said private sector participation would be sought later to make the project more widely available and commercially successful.

"All e-Society projects are launched as pilot projects," Mubarak said. "Later we want the private sector to take it up more broadly. We will be looking for partners to take it up."

A fee may have to be charged for the service later to make it sustainable, she said.

"Anybody, if they seen benefits accruing directly, they are likely to pay for it," she said.

"The sustainability will come only when the farmer feels he's getting a good deal and is willing to pay for the information he gets."

She said another approach to fund the service without having to charge farmers could be to use the platform for commercial purposes relevant to farmers such as companies sending out fertiliser ads.

UAE Etisalat Acquires Tigo Sri Lanka

17th October 2009, online.wsj.com

DUBAI (Zawya Dow Jones) - Abu Dhabi-based Emirates Telecommunications Corp. (ETISALAT.AD), or Etisalat, said Saturday it acquired a 100% stake in Tigo Sri Lanka, a wholly-owned unit of Luxembourg-based Millicom International Cellular S.A. (MICC), for $207 million as it continues its expansion into new markets.

"This new acquisition is a clear example of Etisalat's international investments strategy of seizing distinctive growth opportunities and maximizing value to shareholders," Etisalat Chairman Mohammed Hassan Omran said in an emailed statement.

Omran said Etisalat plans to invest in Tigo Sri Lanka to ensure that it has the "dynamism" to take the leading position in Sri Lanka's telecom market in the next few years.

Tigo Sri Lanka, which started operations in 1989, is Sri Lanka's second-largest mobile phone operator with a 21% market share and 2.25 million subscribers.

"The acquisition promises attractive returns as the Sri Lankan Government is increasing its effort to promote foreign investment in all sectors," Omran said. "It also offers great opportunities for synergy with our other operations in the region, particularly in the U.A.E., Saudi Arabia and India."

Etisalat last week said it is close to finalizing a bond program aimed at financing foreign acquisitions and expanding into new markets.

The bond program - under which the company will be able to sell conventional bonds and Islamic bonds, or sukuk - is in line with "foreign expansion and acquisition activities Etisalat is carrying out in regional and global markets," it said, without specifying which markets it plans to expand into.

Etisalat expects its subscriber base to expand in 2010, from a current 85 million subscribers in Etisalat companies or affiliates across 17 markets in Asia and Africa.

The company already has investments in Asia, including Pakistan, Afghanistan, Indonesia and India, markets "which are among the fastest growing in the telecommunications sector", it said Saturday.

Etisalat shares closed up 1.2% at AED12.60 on the Abu Dhabi Exchange Thursday.

By Stefania Bianchi, Dow Jones Newswires; +971 4 3644967; stefania.bianchi@dowjones.com

Copyright (c) 2009 Dow Jones & Co.

VimpelCom, Russia's second largest mobile operator may be interested in Millicom’s Asia assets in Cambodia and Sri Lanka

By Maria Ermakova, 9th July 2009, Bloomberg

OAO VimpelCom, Russia’s second- largest mobile-phone company, may be interested in Millicom International Cellular SA’s assets in Southeast Asia, said Ksenia Korneyeva, a company spokeswoman.

“Millicom’s Asian assets are potentially interesting for VimpelCom, because they are based in the region that VimpelCom views as the main strategic area for international expansion,” Korneyeva said in a telephone interview from Moscow today.

Millicom, based in Luxembourg, said last week that potential suitors had submitted “expressions of interest” for its Asian assets and that the company hired Goldman, Sachs & Co. as an adviser. Millicom is considering selling its businesses in Cambodia, Laos and Sri Lanka separately or together, Chief Financial Officer Francois-Xavier Roger said July 7, declining to name any potential bidders.

VimpelCom began operations in Cambodia in May and plans to begin operations in Vietnam this month. The Moscow-based company may expand further in Southeast Asia to tap new markets beyond Russia where the number of subscribers exceeds the population, Chief Executive Officer Boris Nemsic said June 6.

To contact the reporter on this story: Maria Ermakova in Moscow at mermakova@bloomberg.net

Axiata, second largest mobile operator in Southeast Asia may bid for Millicom Assets in Cambodia and Sri Lanka

By Soraya Permatasari, 8th July 2009, Bloomberg

Axiata Group Bhd., Southeast Asia’s second-largest mobile-phone operator, is considering an offer for Millicom International Cellular SA’s assets in Cambodia and Sri Lanka, according to two people with knowledge of the matter.

The Kuala Lumpur-based company may bid as much as $500 million for Millicom’s stake in its Cambodian unit and $200 million for the Sri Lankan operations, one of two people with knowledge of the plan said yesterday, asking to not be identified because the discussions are private.

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