Stream A: Investment & Asia & WTO - B) Market
Business Issues (A) Opportunities
SA4
Broader Co-Operation: The Key To Success In Asia’s
Fast Growing Telecom Market
Mr Ragnar Bäck, Executive Vice President of Ericsson Group, President of Ericsson
Asia-Pacific Ltd
Ericsson Asia-Pacific Ltd, Sweden
Good afternoon, Ladies and Gentlemen, These investments have accelerated the
economic development in these countries. At
It is a great honour for Ericsson and myself
the same time, the economic growth has
to be invited to speak at this session of the
increased the demand for telecommuni-
Telecom Asia Forum – to talk about the
cations and information – both products and
market opportunities in relation to WTO and
services. And this in turn has created
Asia.
tremendous business opportunities.
I would like to share with you – Ericsson’s
Asia is now witnessing a more and more
view on the market development of mobile
open and dynamic telecom market,
communications in the region.
supported by a steady economic growth. A
So, what’s the greatest significance of the good example is the Chinese market. I am
WTO’s Agreement on Basic Telecommuni- convinced that this will further enhance
cations in 1997? Well, it is that liberalization market opportunities, especially in mobile
becomes a fundamental principle on a global communications.
scale – among all WTO member countries –
including developing countries. Slide: Mobile Subscribers Q3 2002
Slide: WTO and Asia Take the latest mobile phone subscription
rate. In July, August and September,
In recent years, Asia has provided a number 46 million new mobile subscribers were
of good examples of the liberalization of the added world-wide. Out of these, 25 million
telecom sector. For example in countries like were signed up in Asia Pacific.
South Korea and India the liberalization has
resulted in increased competition, reduction The current 323 million mobile subscribers in
of service rates, and diversification of Asia Pacific, excluding Japan, means that still
telecom services. 90% of the population doesn’t have a mobile
phone. The potential for further market
Despite the global economic downturn in the growth is obvious.
last few years, Asia has out-performed the
rest of the world in terms of economic Slide: Subscription growth by 2007
growth. And there is a strong correlation
between economic growth and the develop- We predict that in five years’ time, 400-
ment of telecom and information industries. 500 million mobile users will be added in this
region. And by 2007, Asia Pacific is expected
As telecommunications technology converges to account for 50% of the global market.
with IT and media technologies, the
importance of the telecom industry, as the Asia is a dynamic and diversified market with
key driver of economic growth, has been all 2G, 2.5G and 3G in operation.
further recognized.
Slide: Market development in Asia
There has been a strong and continuous
investment in the telecom sector by govern- So what will drive this growth? Well, first
ments, foreign investors, and private sectors there is a huge potential for mobile voice
in several markets in Asia – such as China, market in Asia, due to its low penetration in
Malaysia, and Indonesia.
BÄ – 1
developing markets like China, India, ful. We, therefore, suggest further co-
Indonesia, and Vietnam. operation in the following areas:
Voice services will continue to be a big and Slide: Co-operation vital to success
very interesting business.
First, to enhance the co-operation among
Second, mobile data services in Asia are telecom operators, equipment vendors, ap-
growing faster than in other regions. This is plication developers and service providers in
supported by our recent research, showing order to increase revenue growth through
that 75% of world’s mobile data subscribers new applications and services.
are in Asia Pacific.
Ericsson has developed a program called
A good example of the rapid growth of Ericsson Mobility World. It is a global network
mobile data traffic is the Philippines, which is of open labs and web sites, making an effort
best known as the SMS capital of the world. to bring together all the players in the market
The telecom market in the Philippines has – operators, ISPs, content providers, enter-
over 20% of the average revenue per user prises and application developers – to work in
coming from SMS services, making it the partnership towards creating successful
highest in Asia. mobile services.
We believe that with the steady 2.5G We will continue to play the match-making
network expansion, mobile data will be the role in each local market for such co-
key driver for new mobile revenues. It is operation.
particularly true in the maturing markets, Second, to increase co-operation between
which are requiring more sophisticated mo-
advanced and developing markets, exchange
bile data products and services. expertise and share knowledge. Ericsson’s
Third, Asia is taking the lead in using mobile regional Mobile Internet Centre in Singapore
multi-service, with Japan showing a fantastic transfers our competence to different mar-
business model for new mobile services like kets in order to provide our customers with
J-Phone’s “Sha-Mail”. our best expertise and competitive solutions.
Third, to promote co-operation among
With a Sha-mail handset equipped with a
built-in camera, the user can – with just one governments for further commitment to
click – snap a digital photo, see it displayed liberalization in relation to market access and
directly on the screen, and attach it to a mail telecom policies, and by doing so, to create a
and send it off. Easy to use, and fun too. fully competitive business environment that
foster market growth and technology innova-
Today, a little more than half of J-Phone’s
roughly 13 million subscribers use Sha-mail. tion. A regulatory environment that openly
encourages such investment and competition
MMS based on the GSM’s platform, holds is of fundamental importance.
great promise for new and greater business I think the APEC ministerial meetings of tele-
opportunities, permitting broad mobile com- communications and information industries
munications with voice, data and pictures as create an excellent platform for exchange of
well. views and policies and also for development
MMS is already rolling out in a number of co-operation and business facilitation. We
markets, where operators have launched hope to see more such activities that demon-
services allowing mobile users to communi- strate government commitment to continue
cate with pictures. to liberate the telecommunications sector.
To meet the challenge of these new business Ladies and gentlemen, I hope my short
developments and to grasp the opportunities presentation will serve as a base for the
of the emerging markets, I would like to panel discussion and I am confident that
underline that co-operation and partnership more ideas and views will be generated
are vitally important in order to be success- through the discussion.
Thank you.
2 – BÄ