Jun 6, 2013

Microsoft Forms Partnership in Myanmar

Microsoft Corp. on Thursday established a presence in Myanmar for the first time, forming an exclusive partnership with local firm Myanmar Information Technology as the central supplier for all of its products in the emerging market.

The move represents the "first step" in Microsoft's plans for the market, with the company focusing on distributing its products rather than any manufacturing operations, Jamie Harper, president for new markets in Southeast Asia at Microsoft, said in an interview on the sidelines of the World Economic Forum on East Asia.

"All infrastructure in the country depends on computing power," said Mr. Harper, who sees opportunities for Microsoft in Myanmar's large government sector and in business-to-business operations.

Myanmar offers rare growth opportunities for information technology firms, with an Internet penetration of just 0.4% in the country of 60 million. The government has pledged to open up the sector to foreign investments, putting two telecommunications licenses up for grabs, and aims to bump Internet penetration up to 80% in the next few years.

Bidders for the telecom-license tender include Singapore Telecommunications Ltd. and Bharti Airtel Ltd. of India. Winners will be announced by June 27.

Earlier in the year, representatives from Microsoft along with fellow U.S. tech giants Google Inc., Intel Corp., Cisco Systems Inc. and Hewlett-Packard Co. visited Myanmar, part of a joint mission looking at opportunities in the country. The technology sector is one where American companies—lagging behind their Chinese and Japanese counterparts in Myanmar—can fast get a leg up as world leaders in the field. In March, Google Executive Chairman Eric Schmidt also visited Myanmar, the first American executive to do so. He promised to lift the backward sector by partnering with telecommunications companies and other private-sector players.

Mr. Harper declined to comment on specific investments in Myanmar, but said Myanmar Information Technology—which set up the first ATMs in the country last year—has "the resources of Microsoft behind it."

The American technology company also has its eye on other emerging markets in the region, particularly tiny Laos, where it doesn't currently have a formal presence.

"We don't have the same relationship [in Laos that] we have here in Myanmar, but we are very interested in doing something like that there," Mr. Harper said.

Microsoft's announcements come on the sidelines of the World Economic Forum East Asia meetings in Myanmar's capital, Naypyitaw, which is bringing together some 900 business leaders and government representatives in a historic sign of confidence in the once-isolated nation's reform process. Other Western companies have also chosen to announce investments into the country this week. Coca-Cola Co. and Anglo-Dutch multinational Unilever PLC pledged to invest a combined sum of almost $1 billion in Myanmar over the next decade, building manufacturing plants in the first tangible signs of investor confidence in the country.

Source: The Wall Street Journal