Thursday February 17, 2011
By TEE LIN SAY
linsay@thestar.com.my
PETALING JAYA: Green PacketBhd's 4G broadband service unit, Packet One Networks (M) Sdn Bhd(P1), is confident of achieving 450,000 subscribers and expandingits base stations to more than 1,600sites to cover 55% of the populationnationwide by end-2011.
Thus, it is also deferring its target of being EBITDA (earnings before interest, taxation, depreciation and amortisation) positive to end-2011, as it focuses to aggressively acquire nomadic customers from the mobile broadband segment.
Puan Chan Cheong
The nomadic segment refers to the mobile broadband services. Prior to this, P1 was focused on capturing market share from the fixed broadband segment.
Previously, Green Packet had mentioned that it would be EBITDA positive in the first quarter of its financial year ending Dec 31, 2011.
However, with the more intense competition and lower price point in the nomadic segment which P1 plans to grow, the breakeven target needs to be delayed to year-end.
Green Pack et group managing director Puan Chan Cheong expects some short-term erosion of P1's average revenue per user (ARPU) over the short term as it embarks on this strategy.
“The major shareholders in P1 have decided to accelerate subscriber acquisition efforts with a specific short-term focus on the nomadic segment.
P1 will be introducing additional packages, devices and bundles at competitive prices to clearly differentiate it from the competition for both the fixed and nomadic segments. We will launch a new advertising campaign in the first quarter,” said Puan.
Green Packet plans to spend some RM200mil to RM250mil to increase P1's network coverage this year. It will set up a further 650 base sites, achieving a total of 1,600 sites by year-end. Currently, it has a network coverage of some 45%.
“Previously, we were targeting the fixed broadband segment. However, the growth segment is in the nomadic segment. On a compounded basis, it is expected to grow by some 70% up to 2014. We want to make an impact in the mobile segment now,” he said.
For the fourth quarter end ed Dec 31, 2010, Green Packet's revenue increased 58.08% to RM116.25mil, while net loss was reduced to RM77.68mil from RM100.71mil previously.
For the full year, the group's revenue increased by 81% year-on-year to RM394mil. Its EBITDA losses decreased 34% to RM78mil. Under P1, its 4G subscribers reached 274,000 as at end-2010, with a record 56,000 subscribers added in the fourth quarter.
This was contributed by the nomadic segment, which grew three-fold in the fourth quarter, resulting in decreased ARPU to RM72.
The total network subscribers added in P1 in 2010 was a 101% growth to 134,000.
As at end-2010, P1 had a 7% market share out of a total subscriber base of 3.8 million. On its market share extrapolated based on P1's coverage area, it had a 16% market share.
Green Packet shares ended the day unchanged at 76.5 sen.
http://biz.thestar.com.my/news/story.asp?file=/2011/2/17/business/20110217072536
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