Telenor Reshapes Its Presence in Asia, Focusing on Digital Services Amid Challenges

Telenor's Ongoing Transformation Targets Digital Services After Mergers and Myanmar Exit


Telenor, the Norwegian telecom giant, is strategically repositioning itself in the Asian market, with a renewed focus on digital services. The move comes after a series of significant developments, including mergers in Thailand and Malaysia and the challenging exit from Myanmar.

Telenor Asia CEO Jorgen Rostrup has overseen the company’s efforts to adapt and thrive in the evolving Asian telecommunications landscape. This transformation began with the merger of Telenor’s Thailand business, Total Access Communications (DTAC), with True Corporation in March—a merger that brought together a Norwegian entity with a family-owned Thai conglomerate.

Relevant Read: Jazz Invests Over PKR 13.8 Billion in Pakistan Amid Challenging Economic Landscape

The rapid consolidation continued with a second blockbuster merger in Malaysia, marking part of Telenor’s strategic restructuring to secure its long-term presence and success in the Asian market.

Rostrup described the pre-merger landscape as one of intense competition, stating, “Until the day of the amalgamation—these two companies in Malaysia and these two companies in Thailand—our employees woke up every morning thinking about how to beat the other.”

Since taking the helm of Telenor Asia in 2020, Rostrup has navigated the loss of Telenor’s Myanmar operations, heightened competition in Thailand and Malaysia, and the substantial costs associated with deploying 5G networks.

In response to these challenges, Telenor has reaffirmed its commitment to Asia, choosing to strengthen its headquarters in Singapore. This strategic move allows the company to enhance its presence, decision-making capabilities, and engagement with partners and consumers across the region.

Telenor’s mergers align with a global trend of consolidations driven by the substantial investments required for 5G deployment and the development of digital economies. Notably, capital expenditure on 5G accounts for 75% of costs in the telecom industry and is projected to reach $134 billion in the Asia-Pacific region between 2022 and 2025, according to GSMA, an association of mobile network operators.

Rostrup likened the telecom industry’s transformation to other sectors experiencing technological revolutions, such as electric vehicles and renewable energy. He emphasized that building larger entities in some Asian markets enhances financial resilience and stability, given the industry’s changing landscape.

Telenor’s journey in Asia spans three decades and reflects the evolving nature of the telecommunications sector. Initially, the company adopted a mass market strategy, followed by competition centered on network efficiency and quality. Today, the industry faces a convergence of technologies, including 5G, artificial intelligence, cloud services, and big data handling.

Rostrup acknowledged the entry of new players, notably hyper-scalers capable of offering innovative services without legacy infrastructure constraints like traditional cell towers.

Despite the challenging Asian telecommunications landscape, marked by unpredictable regulatory environments and geopolitical risks, Telenor remains one of the few Western companies to maintain its presence in the region, alongside Vodafone.

Earnings from Telenor’s Asian operations reached their peak in 2016 at 67 billion Norwegian kroner ($6 billion). However, the sale of its Indian business to Bharti Airtel in 2017 signaled the industry’s first major consolidations in the 5G era.

The loss of India was initially offset by the promising Myanmar market, where Telenor had a profitable venture since 2015. However, the situation took an unexpected turn in Myanmar when the military initiated a coup in February 2021. In response, Telenor decided to divest its Myanmar operations to Lebanon-based holding company M1 Group and its local partner for $105 million, a fraction of the $500 million license cost.

In Thailand, Telenor entered discussions to merge DTAC with True Corporation, owned by Charoen Pokphand Group, the country’s largest conglomerate. This merger aimed to level the playing field in the Thai market, where AIS held a significant lead in 5G spectrum licenses. While the merger garnered support from industry experts, it also faced opposition from consumer groups and politicians.

Following the merger, Telenor maintains a direct presence in Pakistan and Bangladesh. Bangladesh, in particular, remains a profitable venture for Telenor in Asia.

As Rostrup transitions to lead Telenor’s Nordic operations, his successor faces the challenge of preparing Asia’s emerging economies for industrial and digital competition. Maintaining a voice on the boards of newly merged entities will be essential in shaping the company’s strategic direction.

Rostrup emphasized Telenor’s commitment to consistent principles and expectations, regardless of its operating location. He stressed the importance of competition between telecom players in markets and noted that these markets compete against each other in the digital age.

Previous articleZindigi and EFU Collaborate to Digitize Insurance Landscape
Next articleGovernment Urges Vigilance in Use of Indian IT and AI Products Amid Security Concerns