The telecom sector in Laos still has numerous issues to address. The rate of regulatory reform continues to be well behind wider industry development, even for a developing economy like Laos. The delays in reform have the potential to derail the good progress already made if the process is not speeded up.
The mobile sector in particular has been going through a difficult period. Following the Beeline saga back in 2011/2012, the fallout was still being felt into 2015. A cloud of uncertainty seems to be hanging over the whole market. Subscriber growth is weak after the market had gone backwards for a while. The cellcos are now operating in an environment where the regulator is keeping a tight hold on pricing and competition is in effect discouraged. A further problem emerging for the mobile operators is that network performance is deteriorating across the board. This in turn highlighted two important issues – there has been insufficient investment by the operators in the areas of network maintenance and upgrades, and, secondly, there are obvious deficiencies in the regulatory environment in how the authorities apply and manage network performance standards. It is understood that the MPT had started to address the latter problem in 2015.

The country’s accession to the WTO was finalized in early 2013. As a consequence, Laos is now required to implement its post-WTO accession agenda. Of critical importance for the country’s telecom sector, the WTO Reference Paper on telecommunications among other things calls for the setting up an independent telecom regulator. Indeed, this was required to be put in place two years after accession (ie by February 2015). By June 2015 this had not been achieved. It was understood that work was proceeding on the matter.
Internet services in Laos continue to lag. This remains a major concern in terms of the overall social and economic development of the country. The good news is that since 2011/2012 there has been a boom in mobile broadband internet services (although it has been hard to get reliable statistics on this part of the market). The expansion of internet and especially broadband into the provinces and the rural areas is high on the government’s list of development priorities.

On a positive note, the Lao economy continues to perform well and the IMF has forecast further strong growth, at least in the short term. In the last five or six years there certainly has been a noticeable shift in the economic and social outlook for Laos. After a number of decades of having to struggle with a poorly performing economy and a commercial environment that was in desperate need of reform, there is now positive news being reported on many fronts for this nation of almost seven million people. Most importantly, a significant number of hydro-electric power projects and mining ventures have become reality, with even more possible projects in the pipeline. Laos is finally moving forward in what might be described as a confident fashion.

Telekom Malaysia has reportedly arranged to establish a new PoP in Laos in collaboration with the Lao National Internet Centre (LANIC). According to Telecom Asia, as per the agreement LANIC will host and provide infrastructure for the PoP via its international data centre in Vientiane, while TM will use the PoP to provide alternative connectivity options to its customers and address growing demand for international internet bandwidth in Laos. Further, it has been claimed that the new PoP will enable services including IPVPN, IP transit and global Ethernet services.

Laotian mobile network operator Unitel, which is a joint venture between state-owned Lao Asia Telecommunication State Enterprise (51%) and Vietnam-based Viettel Group (49%), has reportedly inaugurated a 4G network. According to Vietnamnet, the cellco is initially offering access to its Long Term Evolution (LTE) network in the capital Vientiane, as well as a number of other major cities and provinces, including Savannakhet, Luang Prabang and Champasak. Looking ahead, meanwhile, Unitel plans to expand to other localities, although details of the specific locations to be covered were not revealed.

US-listed, Amsterdam-based telecoms group VimpelCom Ltd has partnered with ZTE Corporation to build a complete virtual network infrastructure providing 4G/3G/2G mobile data services to customers across five markets in 2016. ZTE’s virtual Evolved Packet Core (vEPC) network will be introduced in Kyrgyzstan and Laos in February 2016, with subsequent Network Functions Virtualisation (NFV) rollouts in Uzbekistan, Armenia and Tajikistan during the course of 2016. The reinvention of the current network to one that is software-driven and asset-light plays an important part in digital transformation and is a leap forward in bringing the digital world to each and every customer as they navigate their digital lives.

Key developments:
– Unitel launces 4G LTE in Laos in March 2016;
– The mobile market in Laos continues to be in disarray four years after the so-called Beeline crisis;
– The growth in mobile subscribers has stalled as the regulator maintains a strict policy on pricing;
– Mobile penetration had fallen back to 63% coming into 2015, this being below the 65% penetration reported four years earlier;
– A further setback for the mobile sector has been the recent decline in network performance, a problem being felt across all the mobile networks;
– Despite the difficulties in the mobile sector, mobile broadband continues to expand at a rapid rate;
– The MPT implemented compulsory SIM registration for prepaid mobile services in 2014;
– The government was moving forward to implement new internet laws/decrees which were attracting some criticism internationally;
– he MPT/LANIC was preparing to implement the government’s proposed single internet gateway policy, which will require all operators to use the government-managed facility;
– The country is on track to launch its first satellite, LaoSat-1, by December 2015.