Saturday, July 18, 2015

Infrastructure development Japanese companies keen to show their commitment in Myanmar

YANGON -- Japanese telecommunications heavyweight KDDI is becoming intimately acquainted with the challenges inherent to building a mobile communications network in Myanmar. But the company is eager to prove it is up to the task. 

 The Southeast Asian country is on a modernization blitz that offers potentially huge rewards for foreign companies able to get a foothold there and ride the growth. KDDI knows this kind of opportunity doesn't come along often.  

Here to help

On a recent day in a residential area of Yangon, Myanmar's largest city, Japanese KDDI engineers clad in longyi traditional wraparound skirts were working with the local staffers to inspect base stations and fix any problems they find. "Is the antenna aimed in the right direction?" asked one engineer.

     KDDI entered the country's mobile service market in July 2014 under a partnership with Japanese trader Sumitomo Corp. It is in the process of building a network of base stations and repairing those that are not functioning well.

     "Around April last year, our mobile telephony was not working even though there were antennas," said Takashi Nagashima, head of the local joint venture between KDDI and Sumitomo.

     The problem was that many of the antennas had started to lean. Employees at the joint venture, KDDI Summit Global Myanmar, are busy straightening the steel towers one by one.

     The KDDI-Sumitomo partnership has had some hiccups in its push to enter the budding mobile service market in Myanmar, where only 10% of the country's 50 million people use cellphones.

     When the government in 2013 conducted an international bid for licenses to operate mobile services in Myanmar, about 100 players, including the KDDI-Sumitomo team, took part. However, the Japanese companies lost to an alliance between Ooredoo of Qatar and Telenor of Norway.

     Things unexpectedly brightened for the pair in 2014, when state-run telecom provider MPT, which had a monopoly on the domestic market, asked to partner with the Japanese companies to better compete against the new foreign entrants. The Japanese team proposed spending 200 billion yen ($1.6 billion) over a 10-year period to rapidly increase the number of base stations from only about 1,000 at the time.


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