Maldives: Maldives Communication Profile 2013

As the fixed markets decline in the Maldives, mobile broadband services see strong ongoing request.

With its relatively small people of less than 350,000 living on a lot of islands across the archipelago, providing good communications for the Maldives has been paramount. The country has addressed this challenge with considerable success. It presently prides itself on having built one of the majority advanced telecommunications systems in the region. With the country’s well-developed national network, the capital Malé is particularly well served, as are the tourist resort islands; this was further enhanced by the provision of a submarine cable connection to Sri Lanka in 2005; at the same time the opportunity has been taken to provide undersea links between the major atolls, thereby substantially strengthening the domestic connectivity. A second submarine cable linked the archipelago to India in 2006.

Efficient telecommunications services have been established to amount inhabited islands by the national telco, Dhivehi Raajjeyge Gulhun Pvt Ltd (Dhiraagu). Dhiraagu, initially set up as a joint venture between the government and Cable & Wireless plc, has played a major role in establishing the country’s telecoms infrastructure. Despite having been criticised in the early stages of development for its high tariff structure, the company has played an undeniably significant role in building networks and delivering telephone services across the archipelago. Dhiraagu’s shareholding was opened to public investment in late 2011 at the same time as an IPO saw the government sell off some of its stake. In a somewhat surprising move, Bahrain’s Batelco acquired the whole of C&W Communications’ 52% stake in Dhiraagu in April 2013.

Dhiraagu was initially granted an exclusive licence to provide amount telecommunications services in the country. With its licence renewal in 1995, the operator was given a additional clearly stated mandate to provide telephone access to amount inhabited islands by the year 2000. The Dhiraagu monopoly was officially set to run out in 2008. However, the government moved to open up the market formerly than that. The licensing of a second ISP by the government in 2002 signalled its intention to proceed with deregulation ahead of time. A second mobile licence was issued in due course, the new operator Wataniya Telecom becoming operational in 2006.

Despite the slow start, the introduction of a level of competition quickly saw a boom in the country’s telecom market. By 2012 Wataniya had around 180,000 mobile subscribers or about one third of the mobile market. At the same time the incumbent Dhiraagu was as well continuing to vigorously grow its mobile subscriber base. Mobile penetration in the Maldives had reached a remarkable 175% by the start of 2013. However, mobile subscriber increase was finally ‘flattening out’ and the market’s attention was shifting to new generation offerings. Both operators had launched 3G and higher services, and the take up rate was particularly strong. The take up of mobile broadband internet services was running hot through 2012 and into 2013.

Market highlights:

• The Maldives continues to benefit from its newly competitive market, with in general service improving greatly since the arrival of second mobile operator Wataniya Telecom;
• Wataniya has quickly claimed around a third of the mobile market since its launch in 2006;
• Mobile penetration had reached 175% at the start of 2013;
• In general, increase in mobile subscribers had slowed substantially by 2012/13;
• At the same time, there was strong increase in Third Generation (3G) and additional advanced mobile services;
• Despite the efforts of incumbent Dhiraagu to promote fixed-line services, the number of fixed subscribers has fallen significantly in recent years;
• With the country’s strong push into broadband internet, a solid base of fixed broadband services had been established;
• Since 2010, however, virtually amount the broadband increase has been in mobile broadband services,
• An IPO in late 2011 saw the government in the Maldives sell some of its shares in Dhiraaghu, next which majority shareholder Cable & Wireless continued to hold 52% of shares following the IPO;
• In April 2013 Bahrain’s Batelco acquired the whole of C&W Communications’ 52% stake in Dhiraagu.
• An in general slowing in the Maldives national economy in 2009 had certainly affected the country’s telecom sector;
• Stronger increase in the national economy in 2011 provided encouraging signs for the next and suggesting further increase opportunities for the telecom sector; however, 2012 saw the economy slip backwards again and the forecasts for 2013 remained gloomy.

Maldives - key telecom parameters – 2012 - 2013