15%+ annual growth for Sri Lanka’s mobile market in 2015Sri Lanka’s telecommunications sector has had to contend with a developing market in the difficult context of a nearly two-decade-long conflict between the government and separatist Tamil Tiger rebels. With the end of the war came the hope of an enduring peace and a general improvement in the country’s social and economic well-being. This also found the telecom sector well positioned for vigorous growth. A good start has already been made on expansion and provision of infrastructure that is capable of providing a sophisticated level of telecommunications service to the population throughout the whole country. Extending infrastructure into the North and Eastern provinces, those parts of the country most affected by the long-running war has also been given high priority. It is well recognised that the growth and development of any country’s telecom sector is necessary to provide, among other things, an impetus for national economic activity.
There are a range of major initiatives in place that should boost the building of national infrastructure and open the market to more competition. On the regulatory front, Sri Lanka Telecom losing its monopoly in a number of key areas earlier on led the way and since then the market has progressively been opened up to more and more competition.
While mobile penetration has historically been relatively low compared with other more developed Asian markets, it is now catching up, with penetration reaching 115% in 2015. Demand for broadband data services driven by 3G and 4G adoption and increased smartphone penetration should drive reasonably strong growth in the local market moving into 2016 and 2017. The highly competitive mobile market in Sri Lanka had been running with a healthy overall annual growth rate for some years. The market has undoubtedly benefited from its liberalisation and the competition that came with five operators continuing to battle it out for market share. However consolidation in Sri Lanka over the next few years is possible since the market is finding it increasingly difficult to sustain all five operators.
Internet access services in their various forms and associated data services are finally taking off in the country, but coverage and accessibility continue to present challenges. Internet user penetration was estimated at around 30% by 2015. However, the sophistication of the services available is only slowly improving. The early moves to offer broadband internet in the country met with limited success and it seemed that it would be some time before there is a substantial broadband market. However, by 2015 fixed broadband internet services were being supplemented by a rapidly expanding mobile broadband segment. Also during 2015 the availability of e-commerce applications including mobile banking, e-bus ticketing, and mobile points of sale (POS) continued to increase. Demand for broadband data services driven by 3G and 4G adoption and increased smartphone penetration should drive reasonably strong growth in the local market over the next few years.
In the meantime, the government has been promoting such initiatives as the e-Sri Lanka project. It has also established the National Broadband Consultative Committee (NBCC), a special committee appointed to accelerate and promote the availability of affordable high speed broadband internet in the country.
For fixed-line services, after a five-year period of strong growth the subscriber numbers flattened out and then entered into a decline. Considerable uncertainty hangs over this segment of the telecom market. The widespread application of the Wireless Local Loop (WLL) platform was for some time a positive element in this struggling sector. However, even the WLL subscriber numbers are now in decline. There is also large concentration of fixed services in the capital Colombo (penetration of 35%) which makes the national figure look better than it is.
Key developments:
The mobile subscriber base grew strongly during 2014 reaching 22.1 million subscribers.
Dialog Axiata continues to dominate the market with 42% market share.
Dialog Broadband, launched an LTE Advanced pilot network in July 2015.
IPTV services continue to grow strongly from a small base.
The WLL platform which initially drove growth in fixed subscribers is now in decline.
By 2015 fixed broadband internet services were being supplemented by a rapidly expanding mobile broadband segment.
Potential regulatory inhibitors to the existing market players include the super gains tax and the prepaid card levy imposed by the new government.
Sri Lanka’s global connectivity will be boosted by the proposed SEA-ME-WE 5 submarine cable.
Fixed internet subscribers continue to grow but at a slow rate of under 4% per annum.
The government was rolling out 1,000 WiFi hotspots in 2015.
The Information and Communications Technology Agency (ICTA) has launched the Lanka Government Cloud (LGC);
SLT claimed the launch of the first FttH network in Sri Lanka in 2015;
Also in 2015 SLT launched the first nationwide DWDM fibre-optic backbone transmission network
The second phase of the ‘e-Sri Lanka’ project was approved by government.Companies mentioned in this report:
SLT, Lanka Bell, Suntel, Dialog Axiata (formerly Dialog Telekom), Etisalat Sri Lanka (formerly Tigo), Mobitel, Hutchison Lanka, Bharti Airtel Lanka, Data Access; MTN Networks; SLTNet, SkyNet, Suntel, Lanka Bell, BellNet, Wishya Online (Pvt) Ltd, ITMIN Ltd, Eureka Online (Pvt) Ltd.
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1. Key statistics
1.1 Country Overview
1.1.1 Background
1.1.2 Economy
2. Telecommunications market
2.1 Overview
2.2 Background to development
3. Regulatory environment
3.1 Telecommunications Regulatory Commission (TRC)
3.2 National Policy on Telecommunications
3.2.1 Adoption in 1998
3.2.2 The years 2001-2005
3.2.3 Proposed Ten Year Development Plan (2006-2016)
3.3 Historical overview
3.3.1 Convergence Act
3.4 Deregulation
3.4.1 Background
3.4.2 EGO Licences – International licences
3.4.3 International Traffic Bypass Control rules
3.5 Licences
3.6 Privatisation - background
3.6.1 SLT
4. Fixed network market
4.1 Overview of operators
4.2 SLT (formerly Sri Lanka Telecom)
4.2.1 Overview
4.2.2 Statistics
4.2.3 Background
4.2.4 Financials
4.2.5 Privatisation and ownership of SLT
4.2.6 Mobitel
4.2.7 IPTV
4.2.8 WLL
4.2.9 WiFi
4.2.10 National and international networks
4.3 Suntel
4.3.1 Overview
4.3.2 Background
4.3.3 Acquisition by Dialog Axiata
4.4 Lanka Bell
4.5 Dialog Broadband Networks (DBN)
4.6 Other operators
5. Telecommunications infrastructure
5.1 Overview
5.2 National telecom network
5.3 Fixed-line statistics
5.4 Forecasts – fixed-line market – 2015; 2017; 2020
5.4.1 Scenario forecasts
5.5 Infrastructure development
5.5.1 Background
5.5.2 Wireless Local Loop (WLL)
5.5.3 Fibre optic networks
5.5.4 National Backbone Network (NBN) - background
5.5.5 Payphones
5.5.6 Numbering plan
5.5.7 Internet Protocol (IP) networks
5.6 International infrastructure
5.6.1 Background
5.6.2 Developments
6. Internet market
6.1 Overview
6.2 Internet and broadband statistics
6.3 Forecasts – Internet services – 2015; 2017; 2020
6.3.1 Scenario forecasts
6.4 Internet exchange
6.5 ISP market
6.5.1 Overview
6.5.2 SLTNet
6.5.3 Suntel wOw
6.5.4 BellNet
6.5.5 Wishya Online (Pvt) Ltd
6.5.6 ITMIN Ltd
6.5.7 Eureka Online (Pvt) Ltd
7. Broadband market
7.1 Overview
7.1.1 National Broadband Consultative Committee (NBCC)
7.1.2 Broadband monitoring
7.2 Digital Subscriber Line (DSL)
7.3 Wireless broadband/WiMAX
7.4 WiFi
7.5 Fibre to the Building (FttB)
7.6 Internet Protocol TV (IPTV)
8. Digital media
8.1 Market overview
8.2 Regulatory environment
8.3 Digital Terrestrial TV (DTT)
8.4 Internet Protocol TV (IPTV)
8.5 Cable and pay TV
8.5.1 Comet Cable
8.5.2 Dialog TV (DTV)
8.5.3 TV & Radio Network (Pvt) Ltd
8.6 Free-to-Air (FTA) TV
9. Digital economy
9.1 E-Learning
9.1.1 School Net project
9.1.2 Connect To Learn Project in Kandy
9.2 Lanka Government Cloud (LGC)
9.3 e-Sri Lanka
10. Mobile communications
10.1 Overview of Sri Lanka’s mobile market
10.2 Mobile statistics
10.3 Forecasts – mobile services – 2015; 2017; 2020
10.3.1 Scenario forecasts
10.4 Third Generation (3G) mobile
10.4.1 Background
10.4.2 Licences and service launch
10.4.3 Development of 3G
10.5 Fourth Generation (4G) / Long Term Evolution (LTE)
10.6 M-banking
10.7 Major mobile operators
10.7.1 Dialog Axiata (formerly Dialog Telekom)
10.7.2 Mobitel
10.7.3 Etisalat Sri Lanka
10.7.4 Hutchison Lanka
10.7.5 Bharti Airtel Lanka
10.7.6 Satellite mobile
Table 1 – Country statistics Sri Lanka – 2015
Table 2 – Telephone network statistics – June 2015
Table 3 – Internet user statistics – 2014
Table 4 – Mobile statistics – June 2015
Table 5 – National telecommunications authorities
Table 6 – Sri Lanka’s real GDP growth rate – 2006 - 2016
Table 7 – National network status – 2014
Table 8 – Number of telecom operator licences by category – 2014
Table 9 – Fixed-line operators and subscribers – 2011 - 2014
Table 10 – SLT fixed-line subscribers and market share – 1999 - 2014
Table 11 – SLT fixed-line subscribers – wireline and WLL – 2005 - 2014
Table 12 – SLT (Sky Network) broadband subscribers – 2009 - 2014
Table 13 – Historical - Suntel subscribers – 1999 - 2012
Table 14 – Lanka Bell fixed-line subscribers – 1999 - 2014
Table 15 – DBN fixed-line subscribers – 2008 - 2014
Table 16 – Historical – fixed-line subscribers, annual change and teledensity – 1995 - 2005
Table 17 – Fixed-lines subscribers, annual change and teledensity – 2006 – 2015
Table 18 – Fixed subscribers – wireline and wireless (WLL) - 2009 - 2015
Table 19 – Forecast fixed line subscribers and penetration rate – 2015; 2017; 2020
Table 20 – Historical - WLL subscribers – 1996 - 2005
Table 21 – WLL subscribers – 2006 – 2015
Table 22 – Internet users, annual change and penetration – 1996 - 2015
Table 23 – Fixed internet subscribers – 1994 - 2014
Table 24 – Computer penetration by household – 2005 - 2015
Table 25 – International internet bandwidth – 1998 - 2015
Table 26 – Fixed broadband subscribers and penetration – 2002 - 2015
Table 27 – DSL subscribers – 2003 - 2013
Table 28 – Mobile broadband subscribers – 2009 - 2015
Table 29 – Broadband subscribers and households – 2014
Table 30 – Broadband subscribers – fixed and mobile – 2010 - 2014
Table 31 – Forecast fixed broadband internet subscribers and penetration – 2015; 2017; 2020
Table 32 – SLT’s DSL broadband subscribers – 2005 - 2014
Table 33 – Key broadcasting statistics – 2014
Table 34 – SLT’s PeoTV subscribers – 2009 - 2014
Table 35 – DTV’s DTH subscribers – 2008 - 2015
Table 36 – Mobile subscribers, annual change and penetration – 1995 - 2005
Table 37 – Mobile subscribers, annual change and penetration – 2006 - 2015
Table 38 – Mobile operator market share based on subscribers – 2014
Table 39 – Mobile operators, subscribers and annual change – 2014
Table 40 – Mobile broadband subscribers – 2009 - 2015
Table 41 – Forecast mobile subscribers and penetration rate – 2015; 2017; 2020
Table 42 – 3G mobile operators and subscribers – 2009; 2013
Table 43 – Dialog Axiata subscribers and market share – 2004 - 2014
Table 44 – Dialog Axiata prepaid subscribers – 2004 - 2014
Table 45 – Dialog Axiata ARPU – postpaid, prepaid and blended – 2007 - 2015
Table 46 – Dialog’s smartphone penetration – 2014 - 2015
Table 47 – Dialog Axiata: 3G mobile subscribers – 2012 - 2013
Table 48 – Mobitel subscribers and market share – 2004 - 2014
Table 49 – Mobitel: 3G mobile subscribers – 2012 - 2013
Table 50 – Etisalat Sri Lanka subscribers - 2004 - 2014
Table 51 – Etisalat: 3G mobile subscribers – 2012 - 2013
Table 52 – Hutchison Lanka subscribers and market share – 2006 - 2014
Table 53 – Hutchison: 3G mobile subscribers – 2012 - 2013
Table 54 – Bharti Airtel Lanka subscribers and market share – 2009 - 2014
Table 55 – Bharti Airtel: 3G mobile subscribers – 2012 - 2013
Chart 1 - Fixed-line operators and subscribers - 2011 - 2014
Chart 2 - SLT fixed-line subscribers and market share - 2003-2014
Chart 3 - SLT fixed-line subscribers - wireline and WLL - 2005-2014
Chart 4 - Fixed lines subscribers and annual change – 2006 - 2015
Chart 5 - Fixed subscribers - wireline and WLL - 2009-2015
Chart 6 - Internet users – 2003 – 2015
Chart 7 - Internet subscribers and penetration – 2005 - 2014
Chart 8 - Fixed broadband subscribers and penetration – 2005 – 2015
Chart 9 - Mobile subscribers and annual change – 2006 – 2015
Chart 10 - Mobile operator market share - 2014
Chart 11 - Dialog Axiata subscribers and market share - 2004-2014
Chart 12 - Mobitel subscribers and market share - 2005-2014
Chart 13 - Estisalat Sri Lanka subscribers – 2005 - 2014
Exhibit 1 – Telecommunications system operator licensees
Exhibit 2 – Major shareholders in SLT – December 2014
Exhibit 3 – Licensed Internet Service Providers (ISPs)
Exhibit 4 – Licensed Data Communications Service Providers (Facility-based)
Exhibit 5 – Licensed Data Communications Service Providers (Non-Facility based)
