Myanmar awards licences to Telenor and Ooredoo

Norway's Telenor and Qatari operator Ooredoo have fended off competition from nine other groups to win hotly contested telecoms licences in Myanmar, paving the way for the entry of foreign companies into the sector for the first time there.

In its announcement, the Telecommunications Operator Tender Evaluation and Selection Committee, which was charged with selecting the licence winners, also said a consortium of France Telecom Orange and Marubeni Corporation was named as the back-up applicant in the event that one of the two successful applicants does not fulfill the post-selection requirements.

The two licence winners now face the task of developing the Southeast Asian country's nascent but potentially lucrative telecoms industry, alongside the country's two existing telecoms operators. Myanmar is one of the world's last remaining untapped telecoms markets with mobile penetration believed to be around 9 per cent, according to Bloomberg.

It had initially appeared that the licence awards would be delayed after the country's parliament voted to delay awarding the licences until a new telecoms law had been passed. However, the chairman of the committee, Set Aung, told Dow Jones that he was sticking to the original plan.

"Parliament cannot delay the process, only instructions from the presidential office can," he added.

The 15-year licences will be finalised in September, and the operators are then bound to launch services within nine months. Under the licence terms, they have to provide voice services across three-quarters of the country within five years and data services across half of it, Reuters reported.

Telenor confirmed the licence win and said it expected to offer a full range of voice and data services in the second quarter of 2014 based on HSPA and "LTE-ready" technology. The Norwegian incumbent added that it expected to achieve nationwide coverage within five years.

"Myanmar will be an important pillar in our growth strategy and we are fully committed to responsibly leverage our group competencies to provide access to mobile communications services for the people of Myanmar," Telenor CEO Jon Fredrik Baksaas said in a statement. "We now look forward to working with the authorities in Myanmar on the final steps in the licence process."

Other bidders included SingTel, billionaire George Soros, Bharti Airtel, Malaysia's Axiata Group, Millicom International Cellular SA and Vietnam's Viettel Group, as well as consortia led by Jamaica-based Digicel, MTN Dubai and Japan's KDDI and Sumitomo Corp. A consortium consisting of Vodafone and China Mobile had been included on the original shortlist of 12, but withdrew saying that the opportunity did not meet their internal investment criteria.

The selection committee also noted that one of the 11 pre-qualified applicants was disqualified "because its proposed coverage commitments fell short of the minimum requirements contained in the invitation to tender," meaning that only 10 of the applicants were assessed.

For more:
- see this Bloomberg article
- see this Reuters article
- see this WSJ article (sub. req.)
- see this release (PDF)

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