The current economic slowdown is putting more pressure on WiMAX (Worldwide Interoperability for Microwave Access) operators to raise financing, said research company IDC.
Bill Rojas, IDC’s Asia Pacific director of telecoms services, said: “Do the licensees have enough capital? Intel Corp put US$50mil (RM128mil) into Packet One Network Sdn Bhd (P1). But what about the others?”
The are three other licensees; Y-Max Networks Sdn Bhd, Asiaspace Sdn Bhd, and Redtone International Bhd.
According to Rojas, the Malaysian Government needs to do everything it can to ensure a smooth WiMAX rollout. “You can’t just hand out the licences and leave it at that,” he said during a recent press briefing here.
However, he declined to be more specific on what additional steps the Government should take.
The cost of rolling out WiMAX will be huge. But it looks like P1 is set to continue its aggressive expansion this year while the other WiMAX players seem to be taking a wait-and-see approach because of the capital involved, said IDC.
Chua Fong Yang, IDC associate market analyst, said it can cost anywhere from RM100,000 to RM1mil to set up just one WiMAX base-station. And the WiMAX licensees will need hundreds of base-stations.
Michael Lai, P1 chief executive officer, said the financial situation is not affecting P1’s WiMAX rollout plans because the company has adequate capital.
“We have already allocated and planned the funding for our network rollout since we began rolling out our operations last year.
“P1 has already planned RM1bil for its operations over the following five years (from 2008),” said Lai.
P1 was the first WiMAX licensee to launch its service. Available since last July, the service covers the Klang Valley and certain parts of Penang in the north of the peninsula and Johor in the south.
The service offers fixed WiMAX connectivity at speeds of 1.2Mbps (megabits per second) to 2.4Mbps.
Lai declined to reveal exactly how much P1 has spent on its WiMAX rollout to date. “We are a public-listed company and such information is confidential,” he said.
Zainal Amanshah, group chief executive officer of Redtone, said raising capital has been challenging in this period but claimed that due to Redtone’s track record and strong balance sheet, “we have been able to get RM20mil more.”
“We’re not going to go around putting up infrastructure and then wait for customers to sign up; this does not make sense,” he said.
“We will get the customers first, then deploy the service. This way, we’ll not suffer high capital expenditure.”
Zainal said that between now and the launch of its WiMAX trials in Sabah last August, Redtone has invested about RM6mil in its service for Sabah and Sarawak.
Another licensee, Asiaspace, has reportedly invested up to RM200mil to set up 138 base-stations to deliver its brand of wireless broadband via a WiMAX service called Amax.
Also launched last August, Amax is now available in selected areas in the Klang Valley, including Kelana Jaya, Puchong, Sri Petaling and Taman Tun Dr Ismail.
Y-Max Networks and Asiaspace declined to comment on whether their plans are being affected by the economic slowdown.
The nationwide rollout for Y-Max will begin in the fourth quarter of this year (see StarBiz, Nov 28). According to Y-Max, potential subscribers will be able to enjoy speeds of up to 2Mbps.
Asiaspace launched its WiMAX service last September.
IDC market analyst Esther Gan said another hurdle facing WiMAX licensees is acquiring permission to set up base-stations in certain areas.
In a previous interview with In.Tech, Asiaspace chairman Datuk Abdul Ghani Abdullah said delays in getting approval from local authorities and housing developers have caused Asiaspace to slow down its expansion in some areas in the Klang Valley.
P1’s Lai agreed that this was a problem. “At times there are issues with regards to obtaining the necessary approvals from certain local authorities and building owners,” he said.
“But on the other hand, there are also many local authorities that have been very helpful and supportive by speeding up the necessary approvals,” he added.
Redtone’s Zainal said that this has always been a challenge not just for WiMAX licensees but for all telecommunications companies in the country.
“This needs to be addressed if we want to see the proliferation of broadband in Malaysia,” he said.
Bill Rojas, IDC’s Asia Pacific director of telecoms services, said: “Do the licensees have enough capital? Intel Corp put US$50mil (RM128mil) into Packet One Network Sdn Bhd (P1). But what about the others?”
The are three other licensees; Y-Max Networks Sdn Bhd, Asiaspace Sdn Bhd, and Redtone International Bhd.
According to Rojas, the Malaysian Government needs to do everything it can to ensure a smooth WiMAX rollout. “You can’t just hand out the licences and leave it at that,” he said during a recent press briefing here.
However, he declined to be more specific on what additional steps the Government should take.
The cost of rolling out WiMAX will be huge. But it looks like P1 is set to continue its aggressive expansion this year while the other WiMAX players seem to be taking a wait-and-see approach because of the capital involved, said IDC.
Chua Fong Yang, IDC associate market analyst, said it can cost anywhere from RM100,000 to RM1mil to set up just one WiMAX base-station. And the WiMAX licensees will need hundreds of base-stations.
Michael Lai, P1 chief executive officer, said the financial situation is not affecting P1’s WiMAX rollout plans because the company has adequate capital.
“We have already allocated and planned the funding for our network rollout since we began rolling out our operations last year.
“P1 has already planned RM1bil for its operations over the following five years (from 2008),” said Lai.
P1 was the first WiMAX licensee to launch its service. Available since last July, the service covers the Klang Valley and certain parts of Penang in the north of the peninsula and Johor in the south.
The service offers fixed WiMAX connectivity at speeds of 1.2Mbps (megabits per second) to 2.4Mbps.
Lai declined to reveal exactly how much P1 has spent on its WiMAX rollout to date. “We are a public-listed company and such information is confidential,” he said.
Zainal Amanshah, group chief executive officer of Redtone, said raising capital has been challenging in this period but claimed that due to Redtone’s track record and strong balance sheet, “we have been able to get RM20mil more.”
“We’re not going to go around putting up infrastructure and then wait for customers to sign up; this does not make sense,” he said.
“We will get the customers first, then deploy the service. This way, we’ll not suffer high capital expenditure.”
Zainal said that between now and the launch of its WiMAX trials in Sabah last August, Redtone has invested about RM6mil in its service for Sabah and Sarawak.
Another licensee, Asiaspace, has reportedly invested up to RM200mil to set up 138 base-stations to deliver its brand of wireless broadband via a WiMAX service called Amax.
Also launched last August, Amax is now available in selected areas in the Klang Valley, including Kelana Jaya, Puchong, Sri Petaling and Taman Tun Dr Ismail.
Y-Max Networks and Asiaspace declined to comment on whether their plans are being affected by the economic slowdown.
The nationwide rollout for Y-Max will begin in the fourth quarter of this year (see StarBiz, Nov 28). According to Y-Max, potential subscribers will be able to enjoy speeds of up to 2Mbps.
Asiaspace launched its WiMAX service last September.
IDC market analyst Esther Gan said another hurdle facing WiMAX licensees is acquiring permission to set up base-stations in certain areas.
In a previous interview with In.Tech, Asiaspace chairman Datuk Abdul Ghani Abdullah said delays in getting approval from local authorities and housing developers have caused Asiaspace to slow down its expansion in some areas in the Klang Valley.
P1’s Lai agreed that this was a problem. “At times there are issues with regards to obtaining the necessary approvals from certain local authorities and building owners,” he said.
“But on the other hand, there are also many local authorities that have been very helpful and supportive by speeding up the necessary approvals,” he added.
Redtone’s Zainal said that this has always been a challenge not just for WiMAX licensees but for all telecommunications companies in the country.
“This needs to be addressed if we want to see the proliferation of broadband in Malaysia,” he said.
Source: The Star
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