Telecommunication Issue #4

1. TMI sees net profit fall in 3Q despite revenue growth

Despite increased revenues for the three-month period ending 30 September 2008, Malaysian mobile group TM International (TMI) has revealed a 26% drop in net profit for the quarter. Attributing the drop in profit to escalating financial costs and higher losses from its overseas subsidiaries, the company reported net profits for the three-month period at MYR243.9 million (USD67.6 million), compared to MYR328.4 million year-on-year, while revenues rose to MYR3.28 billion, up 28.2% from MYR2.56 billion a year earlier. Strong performance from subsidiaries Celcom in Malaysia and Excelcomindo in Indonesia boosted revenues, with the operators reporting turnover growth of 10% and 60% respectively y-o-y, thanks to increases in both subscriber numbers and usage.Commenting on the results TMI chairman Tan Sri Azman said, ‘We are generally pleased to see that TMI is still recording healthy financials despite the unprecedented volatility in the global markets. We are confident of TMI's longer term growth potential given that through its holdings, TMI addresses a target population of 1.45 billion people with an average penetration rate of 31.1%.’ TMI was listed as a separate company earlier this year after state-controlled Telekom Malaysia spun off its mobile operations.

2. StarHub deploys world’s first commercial 3G femtocell product

Singaporean mobile and broadband service provider StarHub has launched what is being touted the world’s first commercially-available 3G femtocell service, under the banner ‘Home Zone’. The operator’s portable 3G femtocell devices will connect StarHub users’ UMTS handsets directly to their MaxOnline broadband-enabled router in the home/SOHO allowing them to make voice and video calls and send text messages via their cable connection. According to ACN Newswire StarHub is making all local outgoing voice, video calls and SMS messaging free for customers using Home Zone, saving them a significant amount on their monthly bills.

3. Mobily IP network

Mobile operator Mobily has contracted Huawei to assist in the deployment of an internet protocol (IP)/multiprotocol label switching unified core network. Mr Liu Qi, chief executive officer of the Huawei Saudi Arabia Representative Office said, ‘The integration of bearer networks for voice and data is the basis for an all-service operation.’ At the begining of November Mobily paid SAR80 million (USD21.3 million) to take a 94% stake in local internet service provider Zajil as its second move into the Saudi data market, following last year’s USD400 million buy of WiMAX licensee Bayanat al-Oula.

Telecommunication Issue #3

Masalah 1515 (Dial Up)

Email from The Star online:

Patience running out with TMnet staff and service

I HAVE been a subscriber to Telekom Malaysia’s Internet service 1515 and have been having problems sending e-mails for the last six months. E-mails sent locally are bouncing back with the message that 1515’s server SPTM is rejecting my messages. I work for a foreign company with the regional office based in Sydney and have not been able to e-mail my assignments.
Dialing into the company server in Sydney is costly, so I opted to use the 1515 service. I have been complaining almost daily to TMnet by calling 1300 88 1515 and telling whoever answered my call the problems I have been experiencing.
Each time I was also asked whether my telephone number was 732 9637. It has been years since Klang Valley telephone numbers were changed to eight digits yet this question is always asked.
I was told to forward a few e-mails that have bounced back to help@tm.com.my. I did this on Monday. It was not acknowledged. I called again on Wednesday and was told that someone would call me shortly but no one did.
There is nothing wrong with the settings on my laptop. It has been checked by friends, three IT consultants and my son, a computer science Honours graduate. As a customer my patience is running out and I have written this letter out of frustration.

This is the result of monopoly!
WILLIAM DENNIS,
Subang Jaya

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Komen: Come on lah bro, Monopoly apa, nowaday there is a lot of option if you want to use Internet. You may subcribe Broadband Streamix, Celcom, Maxis, Digi and Wimax services. So setakat pakai Dial Up dah ada hati nak complaint.

Memang benar kita kena layan walaubagaimana kecil mana pun bayaran yang dibayar oleh pelanggan kerana Pelanggan always right kan.. Tapi bagi aku nak layan pelanggan nie biarlah bertempat dan realistik. Kalau setakat dial Up takle access dah bising sampai masuk paper aku rasa mesti ada masalah dengan mamat nie.

My 2 cents

Telecommunication Issue #2

TMI WILL PAY TM MYR 4 Billion

Source: The Malaysia Reserve.

1. Azman (CEO Khazanah Nasional Bhd CEO which is Majority shareholder in TMI) Said TMI will have sufficient funds to pay TM amount MYR 4 Billion.

2. Dateline bayaran ini adalah tahun hadapan (FY2009).

3. TM juga akan membayar dividen sebanyak RM 700m or up to 90% of its normalised after-tax profit and minority interest whichever higher.

4. Mempersoalkan kekuatan kewangan TMI, Khazanah akan akan sentiasa kekal komitmen dengan TMI dan menyediakan struktur pembiayaan jangka panjang untuk TMI.

TM Q3 FY2008 NET PROFIT DECLINE

Source from The Star online

KUALA LUMPUR: Telekom Malaysia Bhd posted net loss of RM165.82mil in the third quarter ended Sept 30, weighed down by foreign exchange losses of RM195.7mil. Announcing a weaker set of results on Tuesday, the net loss was in sharp contrast of the net profit of RM658.51mil year ago. Revenue was RM2.06bil compared with TM2.13bil year ago. Loss per share was 4.8 sen compared with earnings per share of 19.2 sen.
TM said its profitability was affected by ssignificant non-recurring items/exceptional costs. These included unrealised forex translation loss and realisation of foreign translation loss on disposal of Societe Des Telecommunications De Guinee S.A. (Sotelgui).
“Excluding these significant non-recurring items/exceptional costs, the normalised profit after tax and minority interests would have been RM176.4mil for the current quarter,” it said.

TM said the group recognised RM68mil charge arising from volume commitment with foreign carriers for prior years based on final settlement. It added that upon completion of disposal of Sotelgui, the group realised foreign translation loss of RM88.8mil in the current quarter, arising from the translation of the net assets in Sotelgui.

Telecommunication Issue #1

APABILA MAHFUZ OMAR BERBICARA TENTANG HSBB

Dalam Harakah bertarikh Rabu 12 November 2008, MP Pokok Sena mempertikaikan pemberian kontrak bernilai RM11B project HSBB kepada TM dan alasan yang diberikan adalah pemberian tersebut adalah tinggi dan boleh dijimatkan kepada RM5B dengan menggunakan teknologi 'Digital Power Line' (DPL) iaitu menggunakan cable power TNB yang ada. Pandangan tersebut memang ada kekuatannya tetapi adalah lebih baik jika kita lebih memahami apa itu DPL. Ini bukan kontrak tetapi Public Partnership (Joint Investment).

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KUALA LUMPUR, 12 Nov (Hrkh) - Kos perbelanjaan Projek 'High Speed Broadband' yang dijalankan Telekom Malaysia lebih mahal iaitu melebihi RM11 bilion, sedangkan terdapat kaedah lain yang jauh lebih murah dari itu. Mahfuz Omar (PAS-Pokok Sena) berkata terdapat kaedah yang lebih murah iaitu tidak sampai RM5 bilion, iaitu 'Digital Power Line' (DPL) yang boleh dimanfaatkan kerajaan di saat krisis kewangan melanda. Dalam masa yang sama, tambah beliau kerajaan boleh terus memberi peluang perniagaan kepada TNB agar mereka boleh menyewa kepada mana-mana syarikat komunikasi yang menggunakan DPL ini.

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- Digital Powerline (DPL) technology provides the transmission of data to users over the same lines that bring electric power to homes and businesses. Using the Internet's TCP/IP protocol, companies using DPL across the mains electricity grid plan to deliver data at speeds up to 100 Mbps (for download). DPL would allow a user to get Web pages and other Internet information over power lines with a 24-hour continuous connection (since your power lines are always connected). This would free your telephone for voice use. In addition, since many home appliances are attached to the power system, they could easily be addressed as Internet devices when plugged in. http://www.powerlinecommunications.net/

Bagi aku HSBB dan DPL ini adalah sesuatu yang tidak sama jika kita melihat dari segi perkhidmatan memang benar mereka berdua memberi perkhidmatan Internet tetapi jika dari segi kelajuan adalah berbeza. DPL kelajuan adalah up to 100 Mb/s tetapi HSBB kelajuan boleh mencapai kepada 1Gb/s dan kita berkata tentang Mb/s dan juga Gb/s adalah kelajuan yang tidak sama. Contain yang ada dalam HSBB adalah tidak sama dengan contain yang akan diberikan kepada DPL (mungkin hanya terhad kepada internet access sahaja).

Project ini akan memberikan satu lagi peluang/menjana pendapatan kepada Syarikat yang satu - satunya memberikan peluang pekerjaan kepada hampir 80% Bumiputera.

TM set to increase backbone internet capacity

Telekom Malaysia (TM) has revealed plans to increase its broadband infrastructure capacity by 30% to 130Gbps in 2009, citing a rise in demand for online services as the main driving factor. Malaysian news source The Star Online also reports that the telco plans to increase its bandwidth to 100Gbps by the end of 2008, up from the 90Gbps it presently offers. Rozaimy Rahman, COO of TM Global, a subsidiary of TM, noted that rising demand has been driven by an increase in the number of voice calls, the growing number of home offices and the rise of high definition TV content.

Telecommunication Trend #2

TMI may sell additional stake to Khazanah

Reuters is reporting that TM International (TMI), recently spun-off from Telekom Malaysia, is considering a stake sale to state investment vehicle Khazanah to finance an acquisition in India, citing local press reports. It is understood that the company is considering the sale in place of a loan to finance the USD1.8 billion loan it took to acquire a 19% holding in Indian cellco Idea Cellular. Khazanah already holds a 44.51% stake in TMI. Additionally, the report suggests that TMI has looked at selling a 10% stake in its Indonesian unit Excelcomindo, although it is believed that current weak market conditions have forced the sale to be reconsidered.

Mobily buys another ISP

The Saudi cellular operator Mobily has paid SAR80 million (USD21.3 million) to take a 94% stake in local internet service provider Zajil. The deal, which was first announced back in July, is Mobily’s second move into the Saudi data market, following last year’s USD400 million buy of WiMAX licensee Bayanat al-Oula. The country’s internet sector is currently dominated by Saudi Telecom Company (STC), with more competition on the horizon in the form of three new wireline licensees led by PCCW, Verizon and Batelco.

XL secures USD140m loan to fund CAPEX plans

Indonesian mobile operator PT Excelcomindo (XL) has secured a USD140 million syndicated loan from four international banks to help fund its capital expenditure plans. XL, an 83.79%-owned unit of Telekom Malaysia, was granted the funding facility by DBS Bank, Economic Development Canada, The Bank of Tokyo-Mitsubishi UJF and Chinatrust Commercial Bank, reports Reuters. The mobile operator has increased its CAPEX target for 2008 from USD1 billion to USD1.25 billion, a significant portion of which will be used to upgrade its networks as subscriber numbers rise sharply. XL had 22.9 million mobile subscribers at the end of June 2008, up 124% year-on-year.

Telecommunication Trend #1

Jakarta limits Qtel In Indosat ownership to 65%:

Indonesia’s Ministry for Communications today announced it intends to limit Qatar Telecom’s (Qtel’s) ownership of the country’s second largest telecoms group Indosat to 65%. The decision comes, writes Reuters, as Qtel prepares to conduct a tender offer for the rest of Indosat's shares after increasing its control over the Indonesian company to 40.8% earlier this year in a USD1.35-billion deal.

DiGi revenues up 10%, profit down 1% on marketing spend:
Malaysian cellco DiGi has reported that its third-quarter net profit fell by 1% year-on-year to MYR269.9 million (USD74.9 million) on higher advertising spending. During the three months ending 30 September 2008, the country’s third largest mobile operator said that revenues rose nearly 10% y-o-y to MYR1.22 billion, while the EBITDA margin fell to 45.6%, against 47.9% in the same period last year, due to pressure from higher traffic and network operating costs. The company added 166,000 net new customers during the quarter, comprising 126,000 new post-paid and 40,000 pre-paid users. At end-September it had 5.83 million pre-paid customers and 976,000 contract subscribers; a total of 6.8 million. CEO Johan Dennelind said in a statement, ‘We believe that over time, higher voice and advanced data usage will lead to continued revenue growth…We also see opportunities to further generate revenues in the medium to long-term with the newly-introduced mobile number portability and the impending launch of our 3G mobile broadband offerings in early 2009.’ DiGi Telecommunications is wholly owned by holding company DiGi.Com, which is itself 49% owned by Norway’s Telenor.

(Business Strategic)
Following the nationwide launch of mobile number portability (MNP), Malaysian cellco DiGi Telecommunications (DiGi) has revealed plans to leverage the service to increase its subscriber base. According to The Star Online, DiGi intends to absorb the cost for any customer switching to its service, despite the regulations allowing operators to charge up to MYR25 (USD7.16) to change provider while retaining mobile number. The move comes as the operator looks to increase its overall market share, placing a specific emphasis on the post-paid market. According to TeleGeography’s GlobalComms database, DiGi had 26.4% market share at the end of June 2008, and DiGi CEO Johan Dennelind noted, ‘With less than 20% of the post-paid market share, MNP allows us to further tap into the space dominated by high usage users who care about their bills.’ In an effort to further drive subscriber uptake, the cellco has also announced the launch of its new ‘1 Low Flat Rate’ tariff, which offers a single flat-rate to all networks across pre- and post-paid and business numbers.

Mobily profits beat forecasts:

Saudi Arabian cellular operator Mobily has reported a 73.3% rise in profits for the three months to the end of September 2008, beating analyst forecasts. Mobily saw third quarter net profits of SAR539 million (USD143.7 million), up from SAR311 million in the same period last year. Reuters says averages of analyst predictions had put profits at SAR492 million.

Indosat's 9Month 2008 net income up 1.9%, but Q3 profit falls sharply:
Indonesia's second largest fixed line and mobile operator Indosat today reported a 1.9% year-on-year rise in its nine-month net income to IDR1.47 trillion (USD149.8 million). Reuters reports a company filing which shows the firm’s revenues in the period under review increased by 14.9% on 9M07 to IDR13.65 trillion driven by strong demand for the operator’s internet and data services. On a less positive note, the operator posted a 30.5% fall in its third-quarter net profit on higher operating expenses and declining ARPU from mobile users. According to Reuters' calculations, Indosat's net profit dropped to IDR417 billion in the three months to 30 September, compared with IDR600 billion in 3Q07.

Monitor the Vessel

AIS IMPLEMENTATION

The Automatic Identification System (AIS) is a system used by ships principally for identification and locating vessels. AIS provides a means for ships to electronically data including: identification, position, course, and speed and with other nearby ships. This information can be displayed on a screen. AIS is intended to assist the vessel's watchstanding officers and allow maritime authorities to track and monitor vessel movements. It works by integrating a standardized VHF transceiver system with an electronic navigation system, such as a LORAN-C (LOng RAnge Navigation Version C) or Global Positioning System receiver, and other navigational sensors on board ship.
This system is required and mandatory for all the ships with 300 GT (gross Tonnage) or more and all the passenger ships regardless of size as regulated by the International Maritime Organization's (IMO) International Convention for the Safety of Life at Sea (SOLAS). It is estimated that more than 40,000 ships currently carry AIS class A equipment.

AIS transponders automatically broadcast information, such as their position, speed, and navigational status, at regular intervals via a VHF transmitter built into the transponder. The information originates from the ship's navigational sensors, typically its global navigation satellite system (GNSS) receiver and gyrocompass.

Other information, such as the vessel name and VHF call sign, is programmed when installing the equipment and is also transmitted regularly. The signals are received by AIS transponders fitted on other ships or on land based systems, such as VTS systems. The received information can be displayed on a screen or chart plotter, showing the other vessels' positions in much the same manner as a radar display. The AIS standard describes two major classes of AIS units:
Class A - mandated for use on SOLAS Chapter V vessels (and others in some countries).
Class B - a low power, lower cost derivative for leisure and non-SOLAS markets.

Other variants are under development specifically for base stations, aids to navigation and search and rescue, though they will all be derived from one of the existing standards and inter-operate with them.