3 July 2012
I touched upon the history of mobile communication in Tajikistan in my last post. Why don’t I tell how it all started in other Eurasian countries as well? I haven’t written anything about Nepal for a long time, so here it goes.
1913 is reported as the “birth date” of telecommunication in Nepal, when the first (fixed) telephone line was introduced in the capital city of Kathmandu. In 1914, a line between Kathmandu and an Indian border town was opened. Some 20 years later, the first automatic exchange for 25 lines was installed in the Royal Palace in Kathmandu (Nepal was a monarchy until 2008) and the first public exchange for 300 lines appeared again in Kathmandu in 1962. TeliaSonera was then taking the first steps towards pan-Nordic mobile telephony standard, NMT...
Major growth in the Nepalese telecom industry has occurred since 1995, following especially World Bank’s assistance. In the latter half of the 1990s, Nepal was growing as fast, if not faster, than any other country in the South Asia region – despite the absence of foreign investment. An important milestone was reached in 1999 when tele-density reached one (fixed) line per 100 inhabitants. The Telecommunication Act of 1997 established a regulatory body, the Nepal Telecommunications Authority (NTA) on March 4, 1998. Government of Nepal passed the Telecom Policy, 1999 (later replaced by the new Telecom Policy, 2004, but still there are complaints among the market players of non-sufficient regulatory base for the fast developing industry).
The state-owned Nepal Telecom (NT), the incumbent public operator, held a monopoly over all aspects of telecommunications in Nepal until mid-2000’s. In 1999, NT launched GSM services, and in 2004 a second national GSM license was awarded to Spice Nepal, the first private mobile operator with foreign investment in the country. In 2005, Spice Nepal launched its services under Mero Mobile (“My Mobile”) brand and in a couple of years won some 40% of the local GSM market. After that, a CDMA and a satellite operators came to the market, some operators received licenses for rural areas.
In 2008, TeliaSonera bought a majority stake in Spice Nepal. The local joke was that Mero Mobile became Tero Mobile (word play: Tero Kivisaari is the President of TeliaSonera Eurasia region, who signed off the deal, and “tero” means “your” in Nepali). In 2010, Mero Mobile rebranded to Ncell, where “N” stands for Nepal.
With the mobile penetration rate of about 20% and a negligible fixed line penetration back then, Ncell made a huge leap in its infrastructure expansion during 2009-11. Ncell’s network currently covers 90% of the country’s 30 million population and we are the leader of the GSM sector. We are literally driving the evolution of telecommunications in Nepal, investing in the mobile infrastructure and services development. Ncell is the biggest foreign investor and the 4th largest tax payer in the country.
Lately, Ncell has been focusing on rural and mountainous areas, where telecom services were previously available only though a satellite operator. (I keep wondering why the Nepalese people choose the highest places of the mountains to build their villages :) From the air, one can clearly see that the slopes are empty and only the summits of the hills are covered with houses.)
A traditional farmer from a Nepali village in this photo is using an Ncell mobile connection to call his son who works in Doha, Qatar, once a week. For many poor rural families it’s the only way to connect to their family members working abroad due to lack of employment opportunities in Nepal.