Boston, MA -- (SBWIRE) -- 08/21/2012 -- BMI's Q312 report on the telecoms market of Cambodia and Laos provides a comprehensive overview of the latest developments to occur within the mobile, fixed-line telephony and internet sectors of these two countries. Subscriber data for Cambodia and Laos are hard to come by, but Russia's VimpelCom publishes data on the number of subscribers and ARPU level for its operations in both countries. While the authorities also provide some subscriber data, we have our doubts about their reliability and accuracy.
There were no changes to our subscriber expectations for Cambodia and Laos, but we have adjusted the forecast scenarios for their ARPU levels in light of new data. In Laos we envisage the average ARPU to decrease to US$2.8 in 2016. This is in spite of an agreement between operators to maintain a minimum call tariff rate of LAK800 a minute.
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Swedish incumbent TeliaSonera announced in April 2012 that it will exit the Cambodian mobile market by selling its 18.6% stake in Smart Mobile. If the Swedish operator, which has operations across many difficult markets, does not choose to remain in the Cambodian market, then what prospects are there for other players? BMI believes Cambodia does offer continued opportunities for a smaller group of operators, rather than the eight that had been present. We continue to expect consolidation in the market, leaving a smaller number of larger players that are more able to compete.
Laos' Ministry of Post and Telecommunications announced that 80% of villages in the country will have mobile coverage by end-2012, up from 76% in 2011. The ministry plans to increase the number of base stations to 6,684 by building an additional 300 by end of 2012, thereby enabling people in 7,300 out of the country's 9,119 villages to access a mobile signal. Additionally, a total of 130 out of 143 districts nationwide will gain access to 3G connectivity, up by 15 districts from 2011.
Cambodia and Laos were ranked 15th and 17th respectively in BMI's Asia Pacific Telecoms Risk/Reward Ratings. We see encouraging signs in Vientiane's economic and trade policy reforms to date and maintain a relatively sanguine long-term growth outlook on the economy. It has made significant headway in its efforts to gain ascension into the World Trade Organization and is likely to gain membership by the end of this year. That said, the lack of access to credit by smaller businesses and the purported lack of the flow-on effects from investments to the local community may lead to inequitable growth in Laos' economy, which may in turn hamper its longer-term growth prospects.
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