Business
1:00 am
Fri March 22, 2013

Google's Eric Schmidt Heads To Another Isolated Asian Nation

Originally published on Fri March 22, 2013 8:55 am

Google's executive chairman, Eric Schmidt, who went to North Korea in January, is making a short visit Friday to Myanmar, also known as Burma.

Why is the senior executive of a U.S. technology powerhouse visiting some of the poorest and least wired countries in Asia?

Schmidt will be the first top U.S. executive to travel to the Southeast Asian nation since it began emerging from decades of international isolation under a military dictatorship.

Schmidt is due to talk at a technology conference. But the former Google CEO will undoubtedly explore the vast business opportunities opening now in Myanmar.

Schmidt's visit comes at a time when the country is undergoing dramatic political and economic reforms. Ernie Bower with the Center for Strategic and International Studies says this presents enormous opportunity for business, particularly in the telecommunications field.

"It's very important to understand that this is a relatively large country that is right in the middle of — it's the bull's-eye of — Asian growth for the next, probably, century," Bower says. "And you just don't find places that don't have telecommunications systems, don't have infrastructure, don't have IT systems, so it's going to be a very big market over the next couple decades."

Bower says less than 10 percent of Myanmar's 60 million people currently have a mobile phone. Myanmar is working to expand and improve Internet and mobile phone networks throughout the country and is expected to award two telecommunications licenses — potentially worth billions of dollars — to foreign companies this year.

Google's Android mobile-operating system is already well established in Asia. And Andrew Bartels, an analyst with Forrester, a global research and advisory firm, says along with its Internet service, Google can offer the whole information-technology package.

Bartels says it helps to have the company's executive chairman make the pitch. He says Schmidt has become something of an ambassador for Google.

"Schmidt has that statesman-like perspective, the ability to go and talk to heads of state or talk with business leaders, and because of his age, his experience, he has a degree of credibility that the younger executives may not have off the bat," Bartels says.

Evan Wilson, a senior research analyst at Pacific Crest Securities, says Schmidt's interest in Myanmar may be philosophical. Wilson says the Google executive is also a member of the President's Council of Advisors on Science and Technology.

"I think if you see what Eric Schmidt is trying to do, going into these countries that don't have deep Internet penetration, and that the government of those countries has really kind of held back the citizens from being online, I think that is what he's trying to break through, just to make sure everyone is online — which could benefit Google and people in general," Wilson says.

Whatever his reasons, Schmidt's visit to Myanmar doesn't guarantee success.

Bower, with the Center for Strategic and International Studies, says there is stiff competition for Myanmar's telecommunications market — from companies in Norway, Malaysia, Singapore and others. And Bower says U.S. companies are hobbled by some sanctions still in place against individuals in Myanmar.

"This is a real risk for American companies," Bower says. "You cannot do business with those people or you're breaking the law."

The problem, he says, is that some of those people hold positions in Myanmar's telecommunications sector.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

STEVE INSKEEP, HOST:

It's MORNING EDITION from NPR News. I'm Steve Inskeep.

Google's executive chairman, Eric Schmidt, has a follow-up act to his visit to North Korea. Today he is in Myanmar, the country also known as Burma. He spoke of the power of technology and is quoted telling an audience that one mobile phone in one village can record injustices. Schmidt is the first big U.S. tech executive to visit the Southeast Asian nation since it began emerging from decades of isolation.

NPR's Jackie Northam reports.

JACKIE NORTHAM, BYLINE: Eric Schmidt's visit to Myanmar comes at a time when the country is undergoing dramatic political and economic reforms. Ernie Bower, with the Center for Strategic and International Studies, says this presents enormous opportunity for business, particularly in the telecommunications field.

ERNIE BOWER: It's very important to understand that this is a relatively large country that's right in the middle of the - it's the bulls-eye of Asian growth for the next probably century. And you just don't find places that don't have telecom systems, don't have infrastructure, don't have IT systems. So this is going to be a very big market over the next couple decades.

NORTHAM: Bower says fewer than 10 percent of Myanmar's 60 million people currently have a mobile phone. Myanmar is working to expand and improve Internet and mobile phone networks throughout the country, and is expected to award two telecommunications licenses this year to foreign companies - potentially worth billions of dollars.

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NORTHAM: Google's Android mobile operating system is already well established in Asia. And Andrew Bartels, an analyst with Forrester, a global research and advisory firm, says along with its Internet service, Google can offer the whole information technology package. Bartels says it helps to have the company's executive chairman make the pitch. He says Schmidt has become something of an ambassador for Google.

ANDREW BARTELS: Schmidt has that statesman-like perspective, the ability to go and talk to heads of state or talk with business leaders. And because of his age, his experience has credibility that the younger executives may not have off the bat.

NORTHAM: Evan Wilson, a senior research analyst at Pacific Crest Securities, says Schmidt's interest in Myanmar may be philosophical. Wilson says the Google executive is also a member of the President's Council of Advisors on Science and Technology. He says Schmidt visited North Korea in January.

EVAN WILSON: And I think if you see what Eric Schmidt is trying to do - going into these countries that don't have deep Internet penetration - and that the government of those countries has really kind of held back the citizens from being online, I think that that he's trying to break through. And just to make sure that everybody's online, which could benefit Google and just people in general.

NORTHAM: Whatever his reasons, Schmidt's visit to Myanmar doesn't guarantee success. Bower, with the Center for Strategic and International Studies, says there is stiff competition for Myanmar's telecommunications market by companies in Norway, Malaysia and Singapore, among others. And Bower says U.S. companies are hobbled by some sanctions still in place against individuals in Myanmar.

BOWER: This is a real risk for American companies. There are a list, it's called the Specially Designated Nationals, or the SDN list. And you cannot do business with those people or you're breaking the law.

NORTHAM: Bower says the problem is some of those people on the list hold positions in Myanmar's telecommunications sector.

Jackie Northam NPR News Washington Transcript provided by NPR, Copyright NPR.

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