TDC to wire up KLCC It targets to connect 300 buildings in city centre by year-end

Tuesday September 14, 2010

By B.K. SIDHU
bksidhu@thestar.com.my

SHAH ALAM: After wiring up several blocks of buildings in Kuala Lumpur’s Mont Kiara, Time dotCom Bhd (TDC) now wants to connect 300 buildings in the KL City Centre area before the year is out.

“We are looking to add 1,000 buildings by the end of next year,” said TDC chief executive officer Afzal Abdul Rahim.

With an additional 300 buildings to the 90 at Mont Kiara, TDC would provide hundreds of residential and commercial units access to fibre optic with transmission speeds of 1 megabit per second (Mbps) to 50Mbps. TDC’s network is capable of boosting speed to 100Mbps with no additional capital expenditure (capex) required.

Afzal Abdul Rahim...`The challenge forward is growth.’

But the challenge for TDC is speed in wiring up the buildings.

“One of the biggest hurdles we face in our network expansion is dealing with the local councils. Things can slow down for us if the approvals are not in place for us to dig and lay fibre (optic) in the ground,” Afzal said.

TDC is one of two major players with a fibre optic network in the country, the other being the incumbent Telekom Malaysia Bhd (TM). Other players such as Maxis Communications Bhd, Jalenas Sdn Bhd and newcomer Vasseti Bhd are also hoping to take a bite of the fibre optic business but they are still building their networks.

Afzal came on board TDC in late 2008 and the turnaround he embarked on at the company is now complete.

TDC recently reported its fifth quarter of profits, earning RM22.98mil in net profit for the second quarter ended June 30 as revenue improved 22.5% to RM83.17mil from RM67.89mil a year earlier.

Cash balances stood at RM199mil as at June 30.

“We have shifted from being a loss-making company to a sustainable one that has reported five consecutive quarters of profit. The challenge forward is growth.

“We cannot be slipping into the red. We are doing far better than in the past. A decade ago, our annual revenue was RM6mil, now it is RM300mil and we are looking at RM1bil in the future,” said Afzal.

He expects TDC’s third quarter financial results to be better than the second quarter as the expansion continues.

According to an analyst, TDC is likely to benefit from the recent reduction in interconnect rates in Malaysia.

“It is small but making an impact in the market. TM’s revenue could be vulnerable to rivalry from TDC and this could increase as TDC expands its network and fine-tunes its strategy.
“The mobile operators should benefit from TDC’s expansion as competition in wholesale leased lines should lower their network costs and allow better geographical coverage,” the analyst said in a report.

In terms of market share. Afzal said TDC had gained ground in all the areas that its services were available even though it was on a head-on battle with the incumbent.
“We are adding market share at about one percentage point every month in these areas and that gives us about 18% market share now. We would like to capture between 20% and 25% market share,” Afzal said. TDC spent RM120mil in capex last year and has the same capex this year which it plans to fund internally.

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