Global Information Society- Term Paper

The Telecommunication Industry

of Sri Lanka

Submitted by:

Neha Rauniyar (PPE Major)

Soumya Samuel (CS Major)

Thushanthini Jeyatissa (CS Major)

Submitted to:

Professor Faheem Hussain

Table of Contents

Country Profile

Introduction

Situation Analysis

• The present status of the ICT/Telecom industry

• Telecom/Internet penetration and market players

• Status of Internet connectivity and market players in ICT industry

• Telecom and ICT regulations/Acts

• Universal service

• New and emerging technologies (i.e. 3G, WiMax, VoIP etc.)

• Status of '3A'

Challenges/Problems identified

Strategic Priorities/Recommendations

Conclusion

Country Profile

Sri Lanka

Capital : Colombo

Population : 20.4 million (2010 data)

Currency : Rupee

Literacy Rate : 91% (2008)

GDP per capita (PPP): 5026 (2010 Est.)

Political System: Republic (2010 Est.)

Source: (Legatum Institute, 2010)

Introduction:

The telecommunication industry of Sri Lanka, though started from a small basis, has

shown a significant growth in the recent years. Sri Lankan telecom sector was liberalized in 1991

and was further advanced with its part-privatized in 1997 (Sri Lanka Telecommunications

Research, 2009). Further, the monopoly status of Sri Lanka was weakened in 1996 with the

increment in fixed-line telephone service operators, reaching 60 by mid-2009 (Sri Lanka

Telecommunications Research, 2009). Also, the challenges faced by Sri Lanka of a nearly two-

decade long conflict between the government and separatist Tamil Tiger rebels facilitated

towards founding the telecom sector well positioned for dynamic growth (Sri Lanka – Key

Statistics, Telecom Market Overview & Forecasts). Today, telecom Industry sector is a $0.8

billion industry, contributing around 2% directly and 5% indirectly to the national output

(News). This paper focuses on the current situation of Sri Lanka telecommunication industry, its

problems and challenges, and suggests some strategies to enhance the present telecom industry

of Sri Lanka.

The present status of the ICT/Telecom industry:

At the present, Sri Lanka has a liberalized telecommunications market which has huge

impacts on economic and social development of the country. The Telecommunication Authority

of Sri Lanka (TASL) is the regulator of telecom industry and TASL is responsible for licensing

for any companies to provide various telecommunication services under the Telecommunication

Act of 1991 (Sri Lanka’s Information Infrastructure, n.d). There are four Fixed Access

Operators, five Cellular Mobile Operators, six Data communications and Internet service

Providers (facilities based), twenty four Data and Internet Service Providers (non facilities

based) and thirty two External Gateway Operators. Also, 7500 public phone services are spread

across the country (List of License Operators, n.d).

The Fixed Access Operators are: (List of License Operators, n.d)

• Sri Lanka Telecom Limited.

• Suntel (Private) Limited

• Lanka Bell (Pvt) Limited

• Dialog Broadband Networks (Pvt) Ltd

Cellular Mobile Operators are:

• Dialog Telekom Limited

• Hutchison Telecommunications Lanka

• Mobitel (Pvt) Limited

• Celltel Lanka Limited

• Bharti Airtel Lanka (Private) Limited

Telecom/Internet penetration and market players:

The Government of Sri Lanka owns 52% shares of Sri Lanka Telecom Limited (SLT)

which is the only fixed wire-line telecommunications service provider. In 1999, the government

divested the stakes of Sri Lanka Telecom (SLT) and assigned the company management control

to Nippon Telegraph and Telephone Corporation (NIIT) of Japan. This partial privatization of

Sri Lanka Telecom (SLT) has a greater level of penetration on fixed line and mobile phone

market (SLT / Vision & Mission, n.d). The SLT is integrated and has monopoly power in

telecommunications market for domestic services, international voice service operations until

2002. Since the privatization, the growth rate of fixed line subscribers is increased and there after

due to the rise of annual tax and marketing prices for domestic services subscriber growth is

declined. However, with this decline in the telecom environment the Code Division Multiple

Access (CDMA) and mobile phone are introduced in the telecom which is the fixed. Due to these

market diffusion the telecommunication services sector has grown significantly and it has 54.5

percent of average growth rate from 1994 to 2004 (Perera, 2010).

In a while, new, faster and more efficient technologies are introduced to the Sri Lankan

telecommunication sector. The telecommunication environment is established by second

generation digital communication systems (2G), automatic international roaming, short

messaging services (SMS), wireless application, protocol mobile internet (WAP) general packet

radio service (GPRS) and band and multimedia messaging services (MMS). In 2004, the

participation of private sectors expands the mobile marketing with new technologies and

enhanced network coverage (Sri Lanka’s Information Infrastructure, n.d). In addition, the access

of Sea Me-We 4 international fiber optic submarine cable is launched on 2005 and that connects

South East Asia to European Countries through Indian Subcontinent and Middle East. Then, SLT

has signed an agreement with Bharat Sanchar Nigam Ltd (BSNL) of India for an under

submarine cable system to connect South India to Colombo (SLT:Our History, n.d). Also Sri

Lanka’s largest mobile operator, Dialog Telekom Limited, become as a shareholder of Telekom

Malaysia in order to have the access of this new cable system (Perera, 2010).

Furthermore, Wireless Internet (WiMAX) network is launched within two years by SLT

and SLT also offers mobile broadband access and internet protocol television (IPTV). The

Telecommunication Regulatory Commission allocates 3.5 gigahertz frequency broadband for

WiMAX and also a test of frequency was allocated to SLT for the rollout of WiMAX project in

Colombo, Kandy, and Galle (Category, n.d). Additionally, Indian’s Bharti Airtel Ltd enters into

Sri Lankan telecommunication market as a fifth mobile phone operator in 2008 and offers 2G

and 3G services (Perera, 2010). In 2008, Nippon Telegraph and Telephone Corporation (NIIT) of

Japan, the shareholder of SLT, sold its entire holding to Global Telecommunications Holdings

N.V. of Netherlands (SLT:Our History, n.d). Overall, expandability of telecom services

providers improves telecommunication’s market penetration.

Status of Internet connectivity and market players in ICT industry:

Sri Lanka telecom industry is established by fixed and wireless local loop operators, and

mobile and public phone operators. ICT industry of Sri Lanka focuses on IT and

telecommunication sectors, such as PC, internet, mobile and fixed telephone services, and

broadband market. However, the broadband penetration level is very low and its cost is high in

Sri Lanka. Sri Lanka has developed the available technology for internet connectivity such as

ADSL (Asymmetric Digital Subscriber Line) fixed wire-line services to WiMAX fixed wireless

broadband access, and GPRS (General packet radio service) mobile telephony internet to HSPA

(High Speed Packet Access) mobile broadband internet to the consumers. As the result, usage

of internet has a significant growth which is shown by the table in next page (Local Industry

News, n.d).

Table: 01:- Statistic of Internet users and Population of Sri Lanka

Year Users Population %Pen. GDP (US$)2000 121,500 19,630,230 0.5% N/A2007 428,000 19,796,874 2.2% 1,6232008 771,700 21,128,773 3.7% 1,9722009 1,163,500 21,324,791 5.5% 2,0412010 1,776,200 21,513,990 8.3% 1,807

Source: International Monetary Fund (Internet Stats, 2010).

Within 10 years number of Internet users throughout Sri Lanka has increased almost 8%.

Table 01 shows in 2000, there is only 0.5% of population have used internet. However, in 2010,

the usage of internet among the country’s population is 8.3% (Internet Stats, 2010).

SLT is fixed wired broadband provider who offers ADSL internet service in the country

and also owns WiMAX broadband network. Besides, Lanka Bell is also a fixed broadband

internet provider in Sri Lanka (Sri Lanka’s Information Infrastructure, n.d). Then, Dialog

provides WiMAX fixed wireless internet access and HSPA mobile broadband internet

connectivity. Moreover, Mobitel provides mobile 3G broadband internet connections under

HSPA and Airtel operator also provides HSPA mobile broadband internet access only (Perera,

2010). However, still now there are only 5 market players and providers for internet service in

the ICT industry of Sri Lanka. Presently the country has the lack of competition within the

internet service market which reflects on the cost.

Telecom and ICT regulations/Acts:

The Telecommunications Regulatory Commission of Sri Lanka (TRCSL) is responsible

for regulating and monitoring the development of the telecommunications sector. Also TRCSL

ensures the competition in the telecommunication industry as open, fair, and effective as

possible. In order to satisfy the public interest in terms of quality, choice and worth for money

there have to be a better relationship between the public and service providers (Legislation, n.d).

Though the TRCSL encouraged private sector investments in telecommunication market, makes

sure that the market players have the resources to fulfill the public’s needs.

The Sri Lanka Telecommunications Act, No. 25 of 1991

The Sri Lanka Telecommunications Act, No. 25 of 1991 amended by Sri lank a

Telecommunications (Amendment) Act, No. 27of 1996. This Act states that for the rights and

responsibilities of the sectors of telecommunication there have to be a commission which is

called Telecommunications Regulatory Commission of Sri Lanka (TRCSL). As the regulator,

TRCSL has the power of decision making of regulation for the telecommunication industry

(Legislation, n.d).

The responsibilities of the Commission include the following:

• Proper creation of a competitive environment

• Encourage Competition for consumer interest

• Facilitate interconnection

• Establish a general framework of taxing, non discriminatory and transparent licensing

for a new entry

• Regulate joint projects, unions and achievements

• Price regulation

• Consumer protection

• Regulation of traffic facilities and scarce resources

• Ensure Universal Access

• Preparation and management for Emergency disaster

• Enforcement of provisions in the Act

Licensing:

The section 17 of Telecommunication Act 1996 is required to obtain a license from

applicable minister to operate a telecommunication system in Sri Lanka. The process of licensing

is non discriminatory, and transparent to encourage the competition and participation in the

market. TRCSL makes the final decision of granting any licenses, and in order to grant a license,

the applied operator has to have the capable resources and skills operate the telecommunication

system. When the TRCSL has the satisfaction on applied operator only the license is granted

(Telecommunications Act Part II, 2010).

Interconnection:

The Telecommunication Regulatory Commission of Sri Lanka makes regulations for

interconnections under section 68 of the Sri Lanka Telecommunication Act, No. 25 of 1991 as

amended by Act, No. 27 of 1996. The rules are applied to all connectable operators and the

operators are allowed to connect to any interconnected telecommunication system

(Telecommunications Act Part I, 2010). The regulation required all access service providers to

be connected with each others; however, the Act stated that the interconnection is mandatory to

connectable operators in order to provide an efficient, non discriminatory and cost oriented basis

services (Hattotuwa, 2010 and ).

Market Structure and Competition:

Sri Lanka has a flexible, open, and market oriented environment, these allows private

sectors to enter and develop in response to the demand of consumers and public needs. In order

to have a liberalized environment, the traditional limitations of entering into market are

eliminated. The private sectors are allowed to provide services to encourage fair and effective

competition in market. This extension of the industry brings new technologies and development

to telecommunication industry (Quality of Service, n.d). As a result of Also the competition

between providers, new equipment, technologies and services are introduced and replaced in the

market.

Consumer Protection:

The TRCSL is responsible to protect consumer from unfair and deceptive marketing

practices and unwarranted use of provide customer information. The regulation is established for

monitoring and preventing those practices and behaviors. TRCSL requires all licensed

telecommunication operators and service providers to have their own procedures for responding

to consumer compliant regarding inappropriate behavior and violations of privacy (Hattotuwa,

2010).

Universal service:

Universal service refers to the ability of everyone to have access to the necessities,

regardless of the location, ethnicity, gender and any other type of disability (ict regulation

toolkit, n.d). Since the World War II, Sri Lankan governments have related universal service in

the context of basic health services, primary education, water and sanitation (Abeykoon, n.d).

However, as today ICT is recognized as a pillar of modern society, most of the developing

countries have integrated telecom service under universal service, including Sri Lanka as well

(ict regulation toolkit, n.d). Most of the time, there has been a strong relationship between ICT

use and economic development, meaning ICT as a crucial factor but not an adequate condition

for economic development (Samarajiva, 2004).

In the context of Sri Lanka, they refer universal service as “Vishva Grama Fund” that

ensure towards openness of modern communication services throughout Sri Lanka and

predominantly, in the villages where there is lack of telecom suppliers and policies (Samarajiva,

2008; The World Dialogue on Regulation for Network Economies, 2003).

With the term universal service, universal service fund is greatly interconnected, which is

a new form of targeted financial support to make the universal service available. Sri Lankan

government has also step ahead and started collecting tax from international calls for universal

service. Their intention was to reduce the amounts every year; however, this strategy was

unsuccessful because of some political and improper regulation (Samarajiva, 2009). The main

focus of Sri Lanka has been to utilize universal service funds as a means of stimulating

investment and service levels for rural areas. Above all, the recent key priority of Sri Lankan

government is enabling a digital society; a modern, progressive society that is an outcome of

integrating information and communication technologies at home, work, education and

recreation (TOPS.lk, 2009).

Sri Lankan government has initiated several projects, emphasizing the need of rural areas

and to provide unrestricted sources of information to all its citizens. The Nenasala Project is one

among several implemented under the e-Sri Lanka Initiative, which in addition to providing ICT

to rural areas also assists in poverty reduction, social and economic development, and peace

building (nanasala.org, 2007).

Some of the services provided by Nenasala are:

• Rural Knowledge Centers: It provides many ICT services (email, telephones, and

computer training classes) which is long-term and effective.

• E-Libraries: It is established at the center of villages with large e-library of books, access

to high speed internet for national, international and local information.

• Distance & e-Learning centers: It helps in providing new information, sharing and

learning opportunities through infrastructure facilities such as a video conferencing room,

multimedia and computer laboratory.

• Tsunami camp computer kiosks: It has established small computer cabin in welfare

camps for people displaced in Tsunami and are provided with free information on health,

education, vocational training in their own local language (nanasala.org, 2007).

Sri Lanka, with such an effective project is doing its level best to provide universal

services importantly, in the rural areas. However, following some other techniques such as

allowing suppliers to extend their services, opening market for competition and effective policy

to address the undersupply of services can help universal service to be achieved more efficiently

in Sri Lanka (Samarajiva, 2004). Hence, in this 21st century, with the advancement in

technological infrastructure, there is an immense need to pause and reflect on the changing

meanings and modify universal service in a way that best serve the vital needs of rural

communities.

New and emerging technologies (i.e. 3G, WiMax, VoIP etc.):

There has been an incredible growth of the telecom industry with innovative and

promising technologies every now and then. In fact, Sri Lanka is one of the first countries in the

Asian region to launch 3G, 3.5G services and High Speed Packet Access (HSPA) technology.

Introducing such technology have enabled subscribers not only to have access to voice

communications but are also provided with broad range of facilities such as video conferencing,

video streaming, mobile TV, music streaming and high speed internet (TOPS.lk, 2009).

Moreover, with the support of the University of Surrey and Surrey Technology Ltd.

situated in UK, Sri Lanka has also move ahead to build up space technology (TOPS.lk, 2009).

Through continuous research and support, Sri Lanka has include EZ Pay (m-payments), VOIP

calling, training/education and retail as well (Ssg-advisors, 2009). Technologies such as HSDPA

and WiMax has also offered high transfer data rates (>512kbps) and established a connectivity

rate structure which is less expensive (Ssg-advisors, 2009).

Project titled, “e-Sri Lanka,” launched in November 2002 is also one step forward for

providing new and emerging services to all the citizens of Sri Lanka. It focuses towards bridging

of the digital divide, meaning reducing the gap between those who have access as well as skills

to use ICT with those who have limited or no access (ifip.org, n.d.). Similarly, Sri Lanka has also

taken initiation to provide telecom facilities for people with disabilities. Payphones are been

fixed at centers where people with disabilities live, learn or work and special telephone

equipment has been installed for hearing impaired children in Sri Lanka (ifip.org, n.d).

Fig.1 The Geography of Technological Innovation and Achievement

Source: UNDP Human Development Report 2001

Chart 01:- Growth of Software Exports

Source: Sri Lanka Information and Communication Technology Association (SLICTA, 2005)

According to the UNDP Development Report 2001, a study done by Wired

Magazine, countries has been categorized according to the significance in

the digital environment. Figure.1 shows that Sri Lanka falls under

"dynamic adopters," meaning Sri Lanka is actively embracing technology

for the workplace and their own work experience. However, countries like

Argentina, Czech Republic, Hungary, and Mexico falls under “potential

leaders” (WIPO, 2001).

Sri Lanka

Sri Lankan software industry has also

shown an average annual growth rate

of around 40% during 1996 to 2001

(UNDP, 2006). Thus, Sri Lanka is

rapidly progressing in the process of

developing new and emerging

technologies.

Status of '3A':

Accessibility, affordability and availability (3A’s) of telecommunication services is a

vital and primarily steps to attain the national development goals and sustainability. Sri Lanka

has defined these three hallmarks as accessibility, connectivity and content and is handled by

Information Infrastructure Program (ICTA, 2009). Accessibility refers to all citizens can use the

services regardless of the location or gender; affordability meaning reasonable price to the

service and availability means service offered in every parts of the country (Thornton.co, 2008).

There has been a strong correlation between accessibility, affordability and availability. For

instance, anything available can only be accessible and similarly, affordability relies on the price

that we can get access to the services.

a) Accessibility:

In context of Sri Lanka, citizens have limited accessibility to telecommunication services.

As estimated by the International Telecommunication Union (ITU), user penetration was around

6% by end-2008, probably reaching 8% by late 2009 (BuddeComm, 2010). For Sri Lanka, rather

than a lack of demand for services, low penetration levels have been the rising problem because

of the acute supply constraints (BuddeComm, 2010). It implies that there is a lack of availability

of telecom services rather than the problem of affordability in Sri Lanka. Further, during the

Presidential election, Sri Lankan news websites were inaccessible from government owned

telecom and only accessible by the private owned telecom industry, raising the issue of

censorship (LIRNEasia, 2010).

b) Affordability:

According to the study done by Nokia, Sri Lanka has the lowest Total Cost Ownership

(TCO) for a mobile phone, which is less than US$ 5, thus making its affordability very high

(TOPS.lk, 2009). However, there has always been a difference in context of rural and urban

areas. Rural user most likely use the telephone to make essential phone calls, while urban one

use their phones as more than a basic commodity. Also, affordability is seen as a problem to

expansion in demand for broadband Internet connectivity in Sri Lanka (LankaNewspaper, 2010).

c) Availability:

There is a need for the availability of Internet, email, e-finance, e-commerce and other

services that can play an imperative role in global commercial activity. Further, high priority for

extending infrastructure to those parts of the country which has been most affected by the long-

running civil war that ended in May 2009 is vital (BuddeComm, 2009). Though Internet age

began in Sri Lanka in 1995, rural citizens still remains disconnect from internet facilities

(Wattegama, 2008). There have been very few efforts taken to benefit Internet in the rural

communities. One of the major obstacle to facilitate Internet in Sri Lanka, especially in rural

areas is lack of local language content and using own proprietary standard which limit

documents produced using one application to be accessed by only that application (ifip.org, n.d).

Table 02:- Penetration of telecom services

Category 2008 2009

Fixed-line penetration (population) 17% 17%

Internet subscriber penetration (population) 1.20% 1.30%

Mobile penetration (population) 55% 71%(Source:BuddeComm)

This graph shows that over the period of one year, mobile penetration has rapidly been

increased while there is no growth in penetration level of fixed-line and only 0.1% growth in

internet subscriber. Thus, Sri Lanka needs to improve over the internet subscriber penetration in

this age of Internet.

Challenges of Sri Lankan telecommunication industry:

Development in the technology field mainly in telecommunication sector will have a

huge impact on the country’s economic development. In Sri Lanka telecommunication industry

is the fastest growing sector with an average rate of 30% to 35% per year which mainly provides

the major telecommunication services such as telephone (both wire and wireless connection),

cellular connections, internet, and radio paging (Ratnayake,Chang,&Bimanee,2006). Among the

all telecommunication services in Sri Lanka, mobile network has a huge growth of 73% and it

plays the role of a monopoly (Ratnayake, Chang, &Bimanee, 2006). Although Sri Lanka is

having a significant growth in its telecommunication services there are some challenges that the

country is facing which hinders the development of these services. This part of the paper will be

focusing on the four major challenges that hider the telecommunication industry of Sri Lanka

are, disparity of service availability in urban and rural areas, lack of proper planning and policy

making of the government, unavailability of infrastructure and lack of awareness about the

industry, internal problems like war and natural disaster.

Urban and Rural Service Disparity:

One of the major challenges that hinder the growth of the telecommunication industry of

Sri Lanka is the disparity in the availability of the telecommunication services in urban and rural

areas. In comparison to the urban areas, the rural part of Sri Lanka is getting very less facilities

mainly in the telephone services and internet accessibility where the rural areas hold more than

half of the population (ITA, 2004). In Sri Lanka, about 70% of telephone services are

concentrated on the urban areas mainly in the capital city, Colombo which constitutes only 5% of

the whole Sri Lankan population (APDIP, 2006). Figure: 1 shows the status of telephones in the

villages of the main South-Asian villages in 2001 (ITU, 2002). According to this among all the

villages only 11% of the villages have the telephone services (ITU, 2002). One of the main

reasons behind the lack of telecommunication services in the rural parts is the high cost for

establishing and maintaining a new service (ITA, 2004). Along with that the providers are

reluctant to provide service in these area considering the cost and benefit of the establishment in

rural areas than in the cities (ITA, 2004).

Table 03:- Status of telephones in South Asia villages (2001)

VillagesCountry Number Number with

telephone servicePercentage with telephone

service

Bangladesh 86 000 12 568 15Bhutan 6000 N/A N/AIndia 607 491 468 016 77Maldives 200 200 100Nepal 3 914 1 761 45Pakistan 125 083 12 000 10Sri Lanka 23 000 2 475 11Total 851 688 497 020 58Source: (ITU, 2002)

Lack of proper planning and policy making of the government:

Although the growth rate of the Sri Lankan telecommunication industry is high ,the major

challenges they come across is the lack of proper planning and policy making of the government

in this sector. This is explicit from the fact that the government is spending more money for the

telecommunication services like internet but the facilities that they are getting is less compare to

the money that they spend (Rajapakse& Dissanayake, nd). In addition, the problems with the

policies that the government adopts also act as a barrier for the telecommunication industry

development. For example, there are no specific competition policies which encourage the

competition in Sri Lanka resulting into the absence of a competition market and hence hinder the

quality of the services (Balasooriya, Alam & Coghill, 2006). Moreover, high rate of debt and

spending the money for war in the past rather than developing the country in terms of IT is less

(Asia Internet Plaza, nd). Additionally, the government is lacking in fulfilling the availability of

the telephone services in many parts of the country mainly in the rural areas (Asia Internet Plaza,

nd). Further the Sri Lankan government has a poor regulatory management for the spectrum

allocation for the telecommunication services (Perumal, nd). Moreover the role of debt and

favoritism in terms of spectrum allocation among the country administration also hinders the

actual growth of the telecommunication industry (Perumal, nd).

Non-availability of effective Mechanisms and awareness:

In Sri Lanka mainly in the case of the internet accessibility the major challenges that the

country faces is the high cost of the software and hardware (Business Monitor

International,2010). For example, buying software and hardware, initial cost of getting internet

connection, monthly charge for subscription is quite high in the sense that it acts as a barrier to

the customers to get connected (Business Monitor International,2010).Such expenses still remain

beyond the reach of most of the individuals in Sri Lanka (Business Monitor

International,2010).At present, affordability is the main limitation to the growth of the internet

connectivity in Sri Lanka (Business Monitor International,2010).It is mainly the urban people,

businesses and private sector corporations who use the Internet (Business Monitor

International,2010).There is also a severe urban and rural disparity related with the Internet,

telephone, and public internet facilities are also limit (Business Monitor International,2010).

Besides, the lack of trained professionals in the IT field also hinders the ICT development in the

country (Business Monitor International, 2010).

Strategic Priorities and Recommendation:

• In order to have a sustainable telecommunication industry, the Sri Lankan telecom sector

should make policies and acts regarding competition where the private sectors can

participate.

• Government should make the service more accessible in rural, urban as well as war prone

areas by providing more public phones and the tele-centers.

• In addition, the government can make surveys and analysis regarding the accessibility,

availability and affordability in different parts of the country.

• Initiatives should be taken for the private-public partnerships to ensure sustainable

growth of industry (Perumal, nd).

• Since, there is lack of trained professionals in Sri Lanka; more people should be trained

in IT fields.

• Comparing to the case of the Bell company which lacked effective policy and

government monitoring, Sri Lanka since is in its phase of IT development should

consider effective policy making and analyze the present legislation.

• Universal service meaning should be modified from time to time so that it can efficiently

meet the need of the people.

• Full participation in e-Commerce and e-Governance should be empowered to improve

access, transparency and efficiency in the telecom business (ifip.org, n.d.).

• Local ICT products and services should continue to be further promoted.

• Promoting growth of the private sector by outsourcing government services to private

sector using ICT (ifip.org, n.d.).

• If it is difficult to obtain fund from government, fund for universal service can be

collected through regulatory fees.

• Computer literacy to rural people, importance and need of internet usage, bridging the

gap between rural, encouraging people who are reluctance to attain new skills are vital.

• Creating knowledge -based society, meaning government has transparency in its action

and display important statistics about the economy in a manner that the entire citizen can

easily have access to it. This will help in brining potential strength and enhanced skills

from individuals in transforming the ICT industry with regard to greater goods of people

(ITA, 2004).

Conclusion:

Overall, the telecom industry of Sri Lanka has shown a progressive growth with its

initiation in various projects and development of market players. Telecom industry has made an

enormous impact on the daily lives of urban citizens through its influence in health, banking,

communications, research and entertainment; however, has ignored the large part of rural areas.

Thus, the real challenge for the Sri Lankan telecom industry is to deliberately organize the

telecom industry in a manner that simultaneously enhances ordinary citizens’ lives.

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