Google's Eric Schmidt Heads To Another Isolated Asian Nation

Eric Schmidt, Google's executive chairman and former CEO, stands near a statue of the late North Korean leader Kim Il Sung in Pyongyang in January. He's headed now to Myanmar, another largely untapped market. i i

hide captionEric Schmidt, Google's executive chairman and former CEO, stands near a statue of the late North Korean leader Kim Il Sung in Pyongyang in January. He's headed now to Myanmar, another largely untapped market.

David Guttenfelder/AP
Eric Schmidt, Google's executive chairman and former CEO, stands near a statue of the late North Korean leader Kim Il Sung in Pyongyang in January. He's headed now to Myanmar, another largely untapped market.

Eric Schmidt, Google's executive chairman and former CEO, stands near a statue of the late North Korean leader Kim Il Sung in Pyongyang in January. He's headed now to Myanmar, another largely untapped market.

David Guttenfelder/AP

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?

Customers at an Internet and multimedia services store in Yangon, Myanmar. The country is working to expand and improve Internet and mobile phone networks nationwide. i i

hide captionCustomers at an Internet and multimedia services store in Yangon, Myanmar. The country is working to expand and improve Internet and mobile phone networks nationwide.

Dario Pignatelli/Bloomberg via Getty Images
Customers at an Internet and multimedia services store in Yangon, Myanmar. The country is working to expand and improve Internet and mobile phone networks nationwide.

Customers at an Internet and multimedia services store in Yangon, Myanmar. The country is working to expand and improve Internet and mobile phone networks nationwide.

Dario Pignatelli/Bloomberg via Getty Images

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.

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