KUALA LUMPUR: Rising broadband competition appears to be halting the growth for incumbent Telekom Malaysia Bhd’s (TM) broadband segment, which expanded a mere 6% in the third quarter ended Sept 30 compared with over 40% a year ago.
In addition to fast-growing 4G WiMAX operator Packet One Networks (M) Sdn Bhd (P1), TM also faces strong competition from Celcom (M) Bhd, Maxis Bhd and DiGi.Com Bhd which continue to aggressively promote their mobile broadband high-speed downlink packet access offerings.
The broadband landscape has intensified where it isn’t just the 3G cellular players like Celcom, DiGi and Maxis that are growing their mobile broadband share. 4G WiMAX operators such as P1 are also giving the celcos a run for their market shares.
Celcom has been doing exceptionally well, with its mobile broadband attracting 114,000 net additions in its second quarter ended June 30. Analysts expect it will report the addition of 300,000 subscribers when it announces its third quarter results next week.
Keen to grab market share from the mobile broadband segment, with the same tenacity it displayed in the fixed broadband segment, P1 is now bundling fixed and nomadic broadband services for users.
The company recently launched a promotional package that comes with a free modem for nomadic broadband services (Wiggy) to subscribers of any of its existing fixed broadband packages now that it has expanded its network to cover 35% of the population.
By the end of the year, P1 targets to deploy an additional 250 base stations, or 50% of its 503 sites as at end-September, as well as to further improve its network quality and expand population coverage to 40%.
P1’s prospects of growing broadband market share is expected to rise with the onset of WiMAX-enabled devices in 2011.
Meanwhile, TM is not resting on its laurels and is now offering most users an upgrade of their speeds at a lower subscription rate than its normal plans but is locking them into a 24-month contract.
Analysts say this should help reduce TM’s churn rate and raise its average revenue per user.
Other WiMAX players such as Asiaspace Sdn Bhd have yet to offer significant competition. In September, Asiaspace garnered a total of 669 subscribers after its inaugural launch.
REDtone International Bhd is presently in the midst of expanding its WiMAX coverage and services in Sabah and Sarawak.
YTL-E Solutions Bhd is the only one of the four 2.3GHz WiMAX licensees that has yet to commercially launch its service. It will be spending RM2.5bil for the rollout.
Needless to say, the broadband pie will only get bigger with the Government’s target to double the country’s current low broadband penetration levels by end of next year.
TM : [Stock Watch] [News]
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