ABC Radio Australia
Cambodia has just 15 million people, and is one of the poorest countries in the region.
And yet it has nine mobile phone operators.
Presenter: Robert Carmichael
Speakers: Thomas Hundt is the CEO of Smart; Syed Azmeer is the chief marketing officer of Hello; Kay Lot, MobiTel's chief operating officer
ROBERT CARMICHAEL: Last year the number of mobile phones in use worldwide passed the 3.3 billion mark. That means that more than half the world's population has a mobile phone, making it the fastest-spreading technology in human history. Cambodia is not what you would call a major player in global telecoms. Its population is relatively small and relatively poor - 15 million people of whom around one-third live below the poverty line. Many millions live just above that line.
And yet Cambodia has nine mobile phone companies, with two more still to launch. So Khun is the Minister for Posts and Telecommunications and has been in his job since 1992. Asked what he thinks is the most important change in telecoms in his time, he answered: Liberalisation - allowing private companies to enter the mobile telecoms market. The government created the chance, and the participants came. And they've kept coming - five mobile phone companies have launched in the last 15 months.
THOMAS HUNDT: Well doubtless the market is competitive.
ROBERT CARMICHAEL: Thomas Hundt is the CEO of Smart, the latest entrant.
I asked him why Smart has started up. He says one reason is that market penetration is low - 25 percent. In other words, just one person in four owns a mobile phone. In fact, Hundt believes the real penetration rate is probably far lower since many people have more than one SIM card.
HUNDT: There are a couple of factors that are supporting the market. First of all the population growth. Secondly we have here in Cambodia 24-25 percent penetration. So looking at other countries in Asia we have a long way to go to penetrate the entire market.
ROBERT CARMICHAEL: Cambodia's telecoms market is hyper-competitive, but if the competitors agree on anything, it is that the market cannot sustain so many players.
Syed Azmeer is the chief marketing officer of Hello, which has been here in various guises since 1992.
SYED AZMEER: Basically it is a war of attrition. People are giving away free minutes and free SIM cards and there comes a certain point where they can't do that any more. Some of the not-so-serious players - once they amass a certain number of subscribers - will be up for sale. That's classic in any telco scenario.
ROBERT CARMICHAEL: Evidence of this war of attrition is widespread, with huge billboards across Phnom Penh, and advertising campaigns in most media - and even plastered on the tuk-tuk taxis that ferry people around the capital.
Azmeer says Hello doubled its subscriber base to 700,000 last year through an aggressive marketing campaign. Good though that is, it means Hello has just a third the number of subscribers of the country's dominant player, MobiTel.
MobiTel claims 60 percent of the market, and says it grew by one-third last year.
And where MobiTel leads, the others have to follow. The low-hanging fruit has been taken in the relatively well-off cities and large towns, so the next stage is for telecoms companies to expand their operations in rural areas, where more than 80 percent of the population live.
But that requires substantial investment. Despite operating in financially-straitened times, MobiTel's parent company last month signed a loan for USD$100 million.
The money will be used to expand its coverage in rural areas, says MobiTel's chief operating officer Kay Lot.
KAY LOT: Well I think the urban growth is still there, but it won't last. There are only so many target markets that are still out there in the urban. So the longer-term strategy is to go out more into the rural areas.
ROBERT CARMICHAEL: To that end, says Kay Lot, MobiTel is erecting hundreds of new base stations in the countryside each year. Its more established competitors are also focusing their efforts outside the cities as the push to capture subscribers moves away from urban Cambodia.
The dominant player, MobiTel, will doubtless continue to do well. And several of its competitors will certainly be around in two or three years time too. But the multi-million dollar question is which of the nine operators will by then have hung up on Cambodia's tough and overcrowded mobile telecoms market.
And yet it has nine mobile phone operators.
Presenter: Robert Carmichael
Speakers: Thomas Hundt is the CEO of Smart; Syed Azmeer is the chief marketing officer of Hello; Kay Lot, MobiTel's chief operating officer
ROBERT CARMICHAEL: Last year the number of mobile phones in use worldwide passed the 3.3 billion mark. That means that more than half the world's population has a mobile phone, making it the fastest-spreading technology in human history. Cambodia is not what you would call a major player in global telecoms. Its population is relatively small and relatively poor - 15 million people of whom around one-third live below the poverty line. Many millions live just above that line.
And yet Cambodia has nine mobile phone companies, with two more still to launch. So Khun is the Minister for Posts and Telecommunications and has been in his job since 1992. Asked what he thinks is the most important change in telecoms in his time, he answered: Liberalisation - allowing private companies to enter the mobile telecoms market. The government created the chance, and the participants came. And they've kept coming - five mobile phone companies have launched in the last 15 months.
THOMAS HUNDT: Well doubtless the market is competitive.
ROBERT CARMICHAEL: Thomas Hundt is the CEO of Smart, the latest entrant.
I asked him why Smart has started up. He says one reason is that market penetration is low - 25 percent. In other words, just one person in four owns a mobile phone. In fact, Hundt believes the real penetration rate is probably far lower since many people have more than one SIM card.
HUNDT: There are a couple of factors that are supporting the market. First of all the population growth. Secondly we have here in Cambodia 24-25 percent penetration. So looking at other countries in Asia we have a long way to go to penetrate the entire market.
ROBERT CARMICHAEL: Cambodia's telecoms market is hyper-competitive, but if the competitors agree on anything, it is that the market cannot sustain so many players.
Syed Azmeer is the chief marketing officer of Hello, which has been here in various guises since 1992.
SYED AZMEER: Basically it is a war of attrition. People are giving away free minutes and free SIM cards and there comes a certain point where they can't do that any more. Some of the not-so-serious players - once they amass a certain number of subscribers - will be up for sale. That's classic in any telco scenario.
ROBERT CARMICHAEL: Evidence of this war of attrition is widespread, with huge billboards across Phnom Penh, and advertising campaigns in most media - and even plastered on the tuk-tuk taxis that ferry people around the capital.
Azmeer says Hello doubled its subscriber base to 700,000 last year through an aggressive marketing campaign. Good though that is, it means Hello has just a third the number of subscribers of the country's dominant player, MobiTel.
MobiTel claims 60 percent of the market, and says it grew by one-third last year.
And where MobiTel leads, the others have to follow. The low-hanging fruit has been taken in the relatively well-off cities and large towns, so the next stage is for telecoms companies to expand their operations in rural areas, where more than 80 percent of the population live.
But that requires substantial investment. Despite operating in financially-straitened times, MobiTel's parent company last month signed a loan for USD$100 million.
The money will be used to expand its coverage in rural areas, says MobiTel's chief operating officer Kay Lot.
KAY LOT: Well I think the urban growth is still there, but it won't last. There are only so many target markets that are still out there in the urban. So the longer-term strategy is to go out more into the rural areas.
ROBERT CARMICHAEL: To that end, says Kay Lot, MobiTel is erecting hundreds of new base stations in the countryside each year. Its more established competitors are also focusing their efforts outside the cities as the push to capture subscribers moves away from urban Cambodia.
The dominant player, MobiTel, will doubtless continue to do well. And several of its competitors will certainly be around in two or three years time too. But the multi-million dollar question is which of the nine operators will by then have hung up on Cambodia's tough and overcrowded mobile telecoms market.
4 comments:
Not much mention of the fact that the network operators are restricting the possibility of users calling from one network to another i.e. 012 calling to 011.
Bad for consumers, anti-competitive, and allows the cambodian government to profiteer as mobile phone operators each have to place their own masts in the same areas as each other, no doubt at a fee....
As long as they pay corrupted government officials, they can enter the market and do as they please.
How many the real investors continue to compete on this field? Cambodia is too small but market is free every body can enter as far as they have money to pay to...
Most time very difficult for cross network so for one person may require a few numbers of SIm card for making easy to connect.
Ministry of Post & Telecom may make much profit on their selling licence..
Oh ho Cambodia market is welcome more entrant to suffer or to lundry their money...
the more of everything and anything in cambodia is the better; it's the attrition for the consumers in cambodia. in a market economy, the more the better; it drives competition and thus lower the price and good for everyone. just make sure it's not chaotic. as long as there a method of the system, cambodia will prosper indefinitely. god bless cambodia.
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