Saturday May 7, 2011
A QUESTION OF BUSINESS By P. GUNASEGARAM
p.guna@thestar.com.my
We must not kid ourselves that the journey towards this is going to be an easy one
The figures may be impressive at first glance but closer examination indicates that not all's well with Telekom Malaysia's plans to implement high speed broadband (HSBB) across the country and even in urban areas in and around Kuala Lumpur (see our cover story this week).
In its first year, TM's broadband service, Unifi, garnered 60,000 subscribers (as at March 24), not particularly impressive. But TM claims that 800,000 premises in 61 exchange areas can access the service that is impressive. The target is 1.3 million premises by 2012.
Question: Why have just a mere 7.5% who could have Unifi services subscribed to it? At this rate, broadband penetration rates for Malaysia, already very low, will continue to be so for many more years to come.
Next question: Doesn't TM have actual subscription targets for Unifi and if it does, what are they? It's easy to claim coverage, but difficult to verify. It's the number of people who use the service that counts. If there is no take-up, service availability is of no consequence.
Bear in mind that TM has 1.7 million broadband customers and just 60,000 Unifi users (as at March 24). At the current rate of take-up of Unifi, it will take 30 years before TM can convert all its current broadband users to Unifi! That's alarming.
Sometimes anecdotal evidence helps where statistics seem to be claiming too much. Residents of Damansara Heights in Kuala Lumpur would be more than aware that their roads have undergone constant digging for some months now (at least four months).
The reason is that a major telecommunications company is laying fibre in the ground and soon the houses in that area will have HSBB access. Question is how soon? If it takes six months to a year to fibre up an area as small as Damansara Heights, how long will it take for the whole of Kuala Lumpur?
Next, folks will remember that TM started its Unifi service in March 2009 in four areas in the Klang Valley - Shah Alam, Subang Jaya, Taman Tun Dr Ismail and Bangsar.
But residents at the relatively new housing area of Setia Eco Park in Shah Alam will testify that there is no Unifi service there until today. How come when Shah Alam was supposed to have Unifi service more than a year ago? It just does not figure.
We should be clear about certain things when it comes to HSBB. First, we are way behind time and have lost many years and lag very far behind major countries in the world. Even in urban areas, we have not been able to provide adequate services comparable to major cities.
Second, we need to accelerate the take-up rate for HSBB by providing services in all urban areas at least at a very rapid rate and at affordable prices. Third, we need to put plans in place for the next generation systems now and plans for implementation.
HSBB is major infrastructure sorely needed to push our knowledge base, communications, competitiveness and productivity up. As a relatively small country we need to maximise resources and avoid duplication the way we did when we granted a slew of licences for telecommunications companies and saw a proliferation of fibre optic networks with no ability to deliver the last mile to homes and offices.
The development of such infrastructure should not be left to a single company, and one too which is not particularly noted for either its innovation or excellence in planning, formulation and execution.
The Government should seriously consider putting all resources for this important backbone of communication into a single new company to be headed by an independent and competent management team with ownership by the Government and all major users, especially the telecommunications companies.
The devil will be in the details but that is something that has to be worked out. Otherwise, the cost will be too great in the long term. Remember, we are way behind as it is.
Managing editor P Gunasegaram says that critical situations call for bold solutions.
http://biz.thestar.com.my/news/story.asp?file=/2011/5/7/business/8634202
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