4G for Brunei Darussalam

The Oxford Business Group on 15 November 2012 reported the following:

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Brunei Darussalam: 4G to target traffic jams
Asia | 15 Nov 2012

A surge in Brunei Darussalam’s mobile data traffic usage at the beginning of 2012 has heightened expectations over the impact that 4G technology will have on the telecommunications sector.

In September, telecoms firm DSTCom revealed that in the first eight months of this year, data usage increased 70% over the same period in 2011, largely due to a rise in the consumption of video streaming sites straining the Sultanate’s telecoms infrastructure.

“The existing 3G technology provides speed and performance, which is increasingly necessary as data growth expands and voice traffic stagnates,” Idris Vasi, the CEO of DST, told OBG. “Data is a big driver for 4G, or long-term evolution (LTE); a lot of operators are using 4G as a data offload strategy, because 3G networks are getting congested. New apps and services require more and more data, including more video. Therefore, it’s not really a question of how the market will accept 4G; the rise in data traffic will make it essential.”

Mobile penetration levels in the Sultanate soared to 120% in 2012 from 32% in 2001, with estimated subscriptions reaching 505,000, despite the population numbering some 406,000. This increase parallels a rapid maturing of the mobile market, illustrated by high usage of social media and the widespread adoption of SMS for the delivery of several services, including school examination results.

While DSTCom boasts a 78% share of the market, Research and Markets, an Ireland-based research firm, has predicted this could narrow in coming years with principal rival B-Mobile Communications gaining a 26.7% market share by 2015. The latter was the first to offer 3G services in 2005 and now says it has around 100,000 subscribers.

“We know that we are still considered a small company, but we want to set ourselves apart from the competitors,” Faadzilah Raheemah Safri Mohdzar, a marketing executive at B-Mobile, said in February, adding that the company plans to focus on quality over quantity.

However, DSTCom appears set to further improve its position through the introduction of 4G internet, which offers much faster speeds. The firm said in September that 4G could be rolled out as soon as the first quarter of 2013, and that it plans to offer bundled packages in the form of USB dongles, tablets and other devices, following successful 4G trials in June.

Swedish firm Ericsson estimated earlier this year that up to 80% of new activations in the Sultanate are smartphones, each of which is likely accompanied by a mobile broadband service package.

Given the additional speeds offered by 4G, which can be up to 50 Mbps, or three times current 3G speeds, the telecoms operator wants to move away from flat-rate pricing to a model that better reflects the maturity and demands of the local market. In 2011, DST’s 3G network was upgraded to 14.4 Mbps and is set to be further improved to 21 Mbps by 2013.

There are likely to be wider financial benefits from 4G for the country, which under its national development plan, Wawasan 2035, hopes to shift to a knowledge-based economy by encouraging emerging industries, such as information and communications technology. Recent research into the potential of 4G in the UK economy by Capital Economics estimated that the UK’s adoption of the new technology could unlock $8.83bn of direct private investment and boost economic growth by 0.5% of GDP.

The introduction of 4G is also likely to raise social issues, given the spate of controversies that have hit the global mobile market in recent months. Incidents ranging from viruses and scams suggesting that subscribers can earn $20 for forwarding SMS messages to hoax kidnappings spread through Twitter underline that the country’s regulators will need to develop firmer legislation for the local market in the coming years.

Likely in response to challenges raised by 4G, the popularity of smartphones and increasing social media usage, the Authority for Info-communication Technology Industry (AITI) has targeted improved regulation of the sector. In April, the AITI called for the development of a “one-stop shop” telecommunications and broadcasting regulatory regime.

Technology convergence represented by the “blurring” of mobile services, fixed-line telephony services, radio and internet-based broadcasts, “requires that Brunei’s regulatory framework for telecom firms and the broadcasting sector evolves to accommodate trends and opportunities,” said AITI.

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