Three strong choices now in selecting a SL mobile network
The Sri Lankan mobile telephone-using public now has three strong choices when selecting a mobile package.
The merger between Hutch Telecommunications Lanka (Pvt) Ltd and Etisalat that was completed recently made this possible, making Hutch the third largest player in the mobile telephone spectrum … after Dialog and Mobitel.
Thirukumar Nadarasa, CEO of Hutch Telecommunications Lanka (Pvt.) Ltd (Hutch) noted that now there are three strong choices when selecting a mobile network as opposed to three weak alternatives earlier. “Earlier it was two strong choices and three weak alternatives. Now we have three strong choices and maybe one weak alternative which the Sri Lankan public can explore.”
On the sidelines of the media conference this week to announce the merger, Mr. Nadarasa told the Business Times that the discussion to merge was almost two years in the making. “We were in discussion for almost two years. We had to figure out the modalities and then obtain approval which took nearly six to eight months.” He added this merger gives Hutch a critical mass. “Enhancing the spectrum was one of the main reasons that we decided to go for a merger.”
When asked if they aim to be more than a mobile company and diversify into other related areas, Mr. Nadarasa stressed that Hutch wants to remain focused on wireless mobility. “We don’t own core competence in any other area. We want to stay close to our core competence which is wireless mobility.”
With this merger Hutch may change the font of their lettering but will not go for fresh branding, he said. On retaining Etisalat staff, Mr. Nadarasa said that Hutch will retain 100 per cent of the staff. “There won’t be a voluntary retirement scheme for Etisalat staff. Deciding to retain the staff was a major concession that we had to make. The telecom regulator decided that nearly 300 people should not be out on the street. This was appreciated by us and we decided to retain them. We accept that one of the costs of the merger is this.” He stressed that Hutch will be inheriting a lot of trained and experienced telecom professionals which is a plus. Hutch will deploy US $ 200 million over the next five years to roll out 4G networks. Now Hutch has access to the 50MHz spectrum and 15MHz of the 900MHz band.
He also noted that the telco market needs consolidation. The large operators control over 70 per cent of the market at present. With the merger where Hutch’s parent company, CK Hutchison Holdings Group will now own 85 per cent stake and Etisalat Group will own 15 per cent, Hutch will control 20 per cent in the telco space. Mr. Nadarasa noted that with the high advancement of technology the mobile industry is moving rapidly. But he stressed that the handset price has to come down in order to increase the Internet penetration of the public.