Myanmar is shaping up as the next and possibly last big telecom opportunity -- but the industry is cautious, to say the least.

The South East Asian country (formerly known as Burma) has a population of around 55 million (according to the CIA World Factbook) and fixed and mobile penetration below 5 percent.

Following political reforms over the past 18 months, and the relaxation/suspension of European Union and U.S. sanctions, it is now seeking foreign telecom investment. (See this BBC reform timeline and this Reuters article for more on the country's recent political and economic developments.)

The Ministry of Post and Telecommunications plans to issue licenses to three new public-private joint ventures, and has begun a search for foreign consultants to help set up a licensing framework.

A recent report from IDC suggests the country is "one of the last untapped ICT markets in the Asia/Pacific region," with telecom infrastructure the most urgent area for investment.

"Myanmar is unquestionably a green field market for ICT investments and first-mover competitive advantage awaits foreign ICT players that are nimble enough to position themselves early in the market," states IDC Indochina Research Director Lam Nguyen in an IDC press release.

Yet this is set to be a telecom liberalization process unlike any other, with human rights just as important as networks.

"If we do go into business there it will be very much with our eyes open from a human rights point of view," says Elaine Weidman-Grunewald, vice president of sustainability and CSR (corporate social responsibility) at Ericsson AB (Nasdaq: ERIC). "We will be looking at social and economic development and hoping we can contribute."

Ericsson, which re-opened its office in Myanmar in June after a 14-year absence, has good reason to be sensitive about human rights. The Swedish firm shipped analog AMPS (advanced mobile phone system) equipment to the junta in the mid-1990s, but its presence in the country caused it to lose at least one U.S. contract and actually provoked a protest at an Ericsson-sponsored Celine Dion concert before it quit the country in 1998, according to a human rights campaign group.

Weidman-Grunewald says Ericsson is "encouraged by the suspension of sanctions," but expects foreign companies will actively monitor human rights developments and the possible return of sanctions during the next year or so.

One of the major human rights issues is the extremely limited access to telecom services and the Internet: Just 0.2 percent of the population have Internet connectivity. In its last Myanmar report, the Open Net Initiative ranked Myanmar 179th out of 181 countries in its "digital opportunity index."

Accurate statistics are hard to come by. Although a government official has recently said 3 million people have a fixed or mobile phone line, research firm Budde.com last year estimated Myanmar's mobile user base at just 550,000.

Despite the sanctions, Chinese and Thai companies have been supplying telecom equipment to Myanmar, according to IDC's Lam, with network systems based on the SCDMA ((Synchronous Code Division Multiple Access)-based broadband wireless access technology known as McWiLL (multi-carrier wireless information local loop), developed by Chinese vendor Xinwei, having been deployed. (See Cisco China Connection.)

Neither Huawei Technologies Co. Ltd. nor ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) responded to Light Reading queries regarding business in Myanmar.

Thaicom, from neighboring Thailand, is offering broadband satellite services from its IPStar satellite.

Among potential operators, Indonesian operator PT Telekomunikasi Indonesia Tbk. (Telkom) is reportedly eyeing Myanmar, while Thailand's True Corp. plc is said to be planning a cable TV service. Singapore Telecommunications Ltd. (SingTel) (OTC: SGTJY), which operates mobile businesses across South East Asia, declined to comment.

Lam said that as well as expanded mobile coverage, likely investments would be in fixed-line networks, domestic long-haul fiber and additional submarine cable connectivity.

— Robert Clark, contributing editor, special to Light Reading