Kyrgyzstan - Telecoms, Mobile and Internet - New Report Available

Kyrgyzstan continues to see strong growth in the mobile market

The telecommunications sector in Kyrgyzstan has been generally characterised by an open market that welcomes both foreign and domestic investors. This has been effectively done in accordance with the requirements set down by the WTO. Despite the market being 'fully competitive' there remained more to be done on the regulatory front to take full advantage of the reforms already in place. There also remains a culture of poor transparency in some aspects of corporate behaviour; this needs to be addressed if the telecom market is to reach its full potential.

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The telecom sector has been part of the final phase of a large scale privatisation program that has been steadily progressing in the country since 1992.

The start of market reforms saw the state telecommunications agency, Kyrgyztelecom, begin to expand and upgrade its legacy telecom network, which at the time was out-dated and poorly distributed. With the expansion of the telecoms sector, upgraded standards have been adopted. At the same time, a new regulatory authority - the National Communications Agency which later became known as the National Agency for Information Resources, Technologies and Communication - was set up to oversee the sector. At an early stage, Kyrgyztelecom was restructured as a public corporation and the government moved towards a partial sale of the operator to the private sector. Around 10% of the company quickly passed into private hands. After a series of failed attempts to sell off the government shareholding, the government continued to hold almost 78% of Kyrgyztelecom.

In the meantime, private operators, which actively function in the mobile market and in the provision of internet services, have been actively investing in the necessary infrastructure. The two big GSM operators - Sky Mobile (Beeline) and MegaCom - have continued to dominate the market, claiming around 75% of the total mobile subscriber base between them. They have been joined by Nur Telecom;

Growth in the country's mobile market was continuing to moderate compared with the general growth in recent years. With positive indications that the market will continue to steadily expand for some time yet, there is growing interest in the development of mobile broadband and data services.

As for fixed-line services, the country's national teledensity continues to gradually decline. Growth in this market segment had effectively stalled. Apart from the lack of growth, there was concern over the imbalance in the market place.

In 2015 the government proposed the construction of a national cellular network. The deployment of the project is expected to take place over the next three years. Approximately 500 base stations will be deployed, to support CDMA, UMTS and Long Term Evolution (LTE) platforms.

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