Interview: Takashi Nagashima
How would you assess the development of human capital within the telecoms industry since the liberalisation of the sector?
TAKASHI NAGASHIMA: It’s well known that the telecoms industry has significantly changed since the market was liberalised, and we ourselves have undergone a major restructuring. MPT is now into its third year of joint operation with our Japanese partners, known collectively as KSGM. As with the other foreign operators, the flow of human capital and investment has transformed the industry, making it much more competitive. This competition has improved services for consumers remarkably, and MPT very much welcomes it as we strive to deliver the best for the people of Myanmar.
As an organisation that is Myanmar owned, we have recognised the need to train, invest in and develop our significant pool of local talent. We draw upon experience from overseas but then create new best practices for this market.
Moreover, MPT provides extensive training to our existing government employees, which is known as knowledge and technical transfer, expanding the overall national knowledge base and improving its competency.
RENE MEZA: I think it has been a positive journey. As an industry, we have invested a considerable amount of resources in infrastructure. Naturally, this comes with necessary investments in human capital to increase the capabilities of our business. Obviously, as a telecoms company, we have the infrastructure, the technology and so forth, but if we don’t have the know-how and the people that have the skills to help us deliver our product or our services it will be a very difficult journey forward.
Of course, human capital development is also an evolving journey as well. The good thing about the people of Myanmar is that, culturally speaking, they are very committed and hungry for growth and learning. Of course this makes our interest in building skills and human capital easier if you were to compare this to an African country, for example, where it’s very difficult to get the people engaged. From that point of view, Myanmar has many of the fundamentals to facilitate human capital growth.
From an education perspective, one of the challenges that Myanmar faces is that the education system is not so robust. To overcome this challenge, we as an industry understand the necessity of forming partnerships with universities and vocational schools so that industry-related education becomes part of the curricula. In the end, we do rely heavily on expatriate workers for the highly skilled jobs, but overall there is an upward trend in the development of human capital.
ERIK TELLMANN: Our mission in Myanmar is built around three core areas. We are firstly here to deliver mobile services to all the people of Myanmar. Looking back, as an industry we can be proud that we have made some significant progress from when the foreign operators entered a few years ago. The second and third legs of the mission relate to our desire to drive standards, both for our business and for the industry.
Through our work we also want to build solid, world-class capabilities for our employees in Myanmar, and develop the ecosystem of partners, suppliers and other players in our value chain. We were clearly aware that this journey carried with it recognisable challenges and risks – but also enormous opportunities to contribute to societal growth in the country. I can say that it has been a largely positive journey for our 600-plus employees and the more than 220 local and international partners in our supply chain.
Together we have worked to expand the availability of our network and distribution to communities residing in the lesser populated areas and border regions in the ethnic states, and have broadly set out to do things in the right way.
Access to our value chain is accelerating socio-economic growth across many levels of society. We are serving customers through more than 200 distributors and 87,000 points-of-sale today; these are local businesses that are part of our distribution network. This in turn creates employment opportunities for these communities through the companies related to our network. More than 80% of Telenor’s suppliers in our supply chain are local companies. We were largely aware of competency gaps in certain areas at the time we entered the market, but we believe we are making really promising progress in filling those gaps. We are witnessing many Myanmar staff taking over senior positions in various functions. Quite recently, for example, Telenor appointed Caroline Yin Yin Htay as chief financial officer.
How has the local market reacted to the introduction of 4G technology?
MEZA: It has been extremely well received. When you look at Myanmar, the market only opened up two years ago. Two years later, the first 4G technology was introduced, which is at about the same time as it was being implemented in developed markets such as Europe. I would characterise this market as a hungry market. Internet consumption and use on a monthly basis per customer is on par with many European countries. Anything between 600 MB to 1 GB per month, per customer, is exactly what we see both in Myanmar and in countries like the UK and France. Those numbers were not necessarily a surprise for us if you compare Myanmar to neighbouring countries such as Vietnam in terms of market penetration. However, we were happily surprised when we discovered that data usage turned out to be as high as it is here.
What unique challenges have you had to face during the roll-out phase of your network? How do these compare with other markets?
TELLMANN: One particular area that impeded our rollout was the lack of access to infrastructure sharing. Infrastructure sharing is today a key driver of growth and efficiency in many mature telecoms markets, and our steadfast engagement with the authorities concerned has resulted in having fair access to key towers and fibre infrastructure. Myanmar is prone to a number of serious weather problems including floods. Devastating flooding that occurred in 2015 had an impact on existing public infrastructure – including telecommunications infrastructure – and further rollout into areas like Rakhine and Chin states has faced delays. However, we did manage to catch up in the latter part of 2015 and in early 2016, and today Telenor’s network reaches into all of the states, regions and territories across the whole of Myanmar.
NAGASHIMA: MPT is in a very good position in this market, whereby we not only have the largest network in terms of population coverage, but we have already also met and gone beyond our licence commitments to the government.
There were some challenges in integrating the legacy network with modern towers – and each tower site must be considered on a case-by-case basis – but thanks to our unique joint operation, we are able to draw on the technological expertise of our Japanese partners combined with established local knowledge via our regional offices.
MEZA: I think that the first very unique challenge that we have as an industry is that Myanmar has more than four months of the rainy season. The monsoon brings tremendous challenges in terms of gaining access to work sites, flooding, workers being unable to access reliable transport, and so forth. This of course leads to consequences from an economic point of view. The second unique challenge we face is in terms of infrastructure. We do not always have access to commercial power, so for us to complete sites and towers in rural areas we need to rely heavily on mobile generators. This brings a disproportionately higher cost to run these sites in comparison to a major city like Yangon or Mandalay.
Third, you have challenges surrounding the issue of child labour, and we have to work very closely with our business partners to ensure that they are complying with our policies and regulations.
Lastly, at the beginning of our journey we had difficulty receiving the necessary permits for laying fibre-optic cable in our sites, but those are behind us now, and moving forward the challenge for us is to monetise the investment we have made.
In your opinion, how should spectrum allocation be most effectively prioritised?
NAGASHIMA: Spectrum is a valuable asset for the country, and it should be allocated after careful consideration and planning. I believe that the government and the regulators are working with a spectrum roadmap and a timeline for this.
All of the operators are eagerly following these developments, and looking ahead, we hope that ultimately this will provide the best outcome for the people of Myanmar and a great improvement of the country’s telecommunications sector.
For MPT, and the LTE services that we are rolling out in early 2017, we have been preparing for a full launch on the 1.8-GHz spectrum in order to deliver the best and fastest coverage. Like the other operators, we had a limited 2.1-GHz rollout in 2016 but eagerly awaited the spectrum allocation by the Posts and Telecommunications Department for 1.8 GHz, which we believe is ultimately the best for our genuine LTE-4G service. Now that this is here, MPT is able to offer another step change for consumers in Myanmar.
MEZA: The unique and key factor for success in the data explosion that is expected in Myanmar is spectrum allocation. Without the right amount of spectrum, mobile operators will be limited in what they can do to ensure the best quality of service. We are working together with the regulator to develop a spectrum roadmap that effectively establishes what the right priorities should be in terms of spectrum allocation. The worst thing that can possibly happen is that spectrum is sitting idle with its licensees. In this situation, spectrum is an extremely important issue, not only as an operator, but on an industry-level as well.
TELLMANN: In July 2016 we launched our 4G service in Naypyidaw and we are aiming to expand to other cities gradually. We are expecting to get more spectrum appropriate for 4G. The award of 1800-MHz-spectrum in Q1 2017 is crucial for delivering a quality data experience, and “real 4G”. Ideally we expect a fair and balanced allocation of spectrum. We hope to see clarity around the awarding of the spectrum roadmap, particularly with respect to timing and principles around bands, in line with international best practices.
With mobile penetration rapidly on the rise, how can the education sector capitalise on the advancement of the telecoms industry?
MEZA: I think a lot can be done. One of the things that can be accomplished from a corporate social responsibility point of view is engaging international and global organisations to work together with the government to connect institutions such as hospitals and schools to the internet.
With education in particular what we aim to do is bring in the element of e-learning. What you typically find in countries such as Myanmar is that the government does not have the budget or funds necessary to pay teachers. E-Learning enables one teacher to reach hundreds if not thousands of students throughout the country. We are also in the process of refurbishing vocational technical centres and connecting them to the internet. Ultimately, the potential for mobile connectivity to broaden the educational landscape is massive.
TELLMANN: Myanmar is finalising a new blueprint for its educational system and we believe plans to effectively utilise telecoms platforms for offering access to formal and non-formal education will be included. For our part we believe everyone has the right to an education and we are committed to eradicating child and underage labour in our supply chain, partly through creating opportunities to access non-formal education.
Towards this end, we have engaged Myanmar Mobile Education (MyME) to provide quality, non-formal education to underage workers in selected Telenor-branded teashops in Yangon and Mandalay. The MyMe Teashop Programme provides education to teashop children and their communities via mobile and teashop classrooms where these children have an opportunity to learn basic literacy, math, digital literacy, personal hygiene, English and interpersonal skills in a safe environment. Recognising the success of the MyME Teashop Programme and the widespread need for informal education nationally, MyME and Telenor Myanmar initiated a second programme in 2016 – the MyME Box. Largely funded from the profits of Telenor’s “Vanity Auction” event in Yangon, the programme aims to use ICT to deliver MyME’s non-formal educational content to over 5000 additional students by the end of 2016 in both physical and online class settings.
As part of our support for non-formal education in Myanmar, we also established Lighthouses, which are social enterprises to promote digital literacy across the country, especially in rural areas. So far we have established 61 Lighthouses in 12 states and regions and we expect to open at least 200 by the end of 2018. Our MyME and Lighthouses programmes are part of Telenor’s Corporate Responsibility Initiative in Myanmar. Other initiatives include mHealth, an app for maternal and child health information, and humanitarian relief support for disaster-affected communities.
NAGASHIMA: It is not only mobile penetration that has seen such a sharp and rapid rise, but more specifically smartphone penetration in Myanmar is taking place at an outstanding rate. As the telecoms industry rolls out connectivity in rural areas – and as speeds improve and costs come down – we expect the education sector to seize the chance to use technology in order to improve the lives of students across the nation. This can be as simple as having fast mobile Wi-Fi connections or better data packages, but also the provision of training programmes to educate the next generation of tech entrepreneurs that surely will benefit the most from Myanmar’s so-called “leapfrogging” jump forward in telecoms. As with MPT’s collaboration with the NLD Education Network, there is a fantastic opportunity to bring students closer to education, particularly for digital skills, meaning that instead of travelling great distances to access schools and training, schools can now come directly to them. In that project we donated laptops, Wi-Fi connections and provision for the training of teachers to deliver digital skills. As technology improves across the industry, the internet will become an even more important part of education – not least because free and easily accessible platforms such as Google, You-Tube and Wikipedia are openly available in Myanmar for people looking to educate curious minds.