Highlight: YTL’s 4G push

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KUALA LUMPUR: Nearly six months after the Malaysian Communications and Multimedia Commission (MCMC) awarded the highly sought-after 4G-LTE (long-term evolution) spectrum to eight local telco players, only two providers have rolled out services and two have expressed plans to do so in the near future.The others have kept mum on their plans, particularly Tan Sri Syed Mokhtar Al-Bukhary’s Puncak Semangat Sdn Bhd, which had received 40MHz of the 2.6GHz spectrum.Although some question the delay in the deployment of 4G-LTE services to the masses, there has been no announcement even by the MCMC on a deadline for the telcos to roll out the network.For YTL Communications Sdn Bhd CEO Wing K Lee, the decision for YES 4G to delay the rollout of 4G-LTE network is a calculated and carefully weighed one.“In my opinion, 4G-LTE is a 2014 story. If MCMC tells us that we must deploy soon, we are ready to do so on our WiMAX network. It’s just that we need the technology to be more mature,” he said in an exclusive interview with The Edge Financial Daily.“We will launch LTE when the time is right but that day is not today,” he added.The 2.6GHz frequency on which the spectrum runs is not the industry standard across the world.In fact, countries such as the US, Australia, and Thailand use the 1.8GHz band to deploy 4G-LTE, while others use either a combination of frequencies or the 2.6GHz.This poses a rather interesting challenge not only for telco providers but also for device manufacturers which supply smartphones and tablets to consumers.“Devices are simply not ready yet. In fact, there is no such thing as 4G-LTE roaming. No manufacturer can make a device which can accommodate all of these frequency bands. If they do, it will be the size of a radio.“So naturally manufacturers will build according to the most popular band as in the case of Apple’s iPhone which is built to accommodate the 1.8GHz band,” Lee said.For more devices to be made on the 2.6GHz frequency, manufacturers would have to see a compelling enough demand from the market, which is sorely lacking.China and India have said that they will run LTE services on the 2.6GHz band, but this remains to be seen as China has yet to set a date to auction or award the spectrum. India’s target to roll out services this year could be subject to delays.“Until China and India hit critical mass and have solid plans to roll out LTE in their countries, there will be a gap in devices specifically those that cater to Malaysia’s specifications,” Lee said.Although some may grumble the allocation of spectrum was unfair as unknown entrant Puncak Semangat had received the lion’s share, Lee is happy with the allocation given to YTL Communications. “We think it’s good enough and also we have the 2.3GHz to run on. So Puncak Semangat gets 40MHz, it’s starting from scratch after all,” he said.Lee was reported to have said that a key challenge for telco operators moving forward is the “all-you-can-eat data pricing”, which he said is not sustainable”.Recent Reuters reports noted that consumers in the US were not taking up 4G-LTE plans as much as operators would like them to. South Korean operators cautioned telcos in other countries that the average revenue per user was insufficient to recover the cost of investment involved in setting up the network.“The business model and cost structure are largely based on a telco’s voice network with data as an add-on, but the reality is that it is now the other way round.“Companies must embrace a data network and voice should be provided as an add-on,” Lee said. According to a report by RHB Research Institute, YTL Communications is likely to focus on implementing its RM4 billion 1Bestarinet project awarded by the government in 2011 to provide WiMAX services to 10,000 schools in Malaysia. 

This article first appeared in The Edge Financial Daily, on 13 May, 2013.KUALA LUMPUR: Nearly six months after the Malaysian Communications and Multimedia

Commission (MCMC) awarded the highly sought-after 4G-LTE (long-term evolution)

spectrum to eight local telco players, only two providers have rolled out services

and two have expressed plans to do so in the near future.The others have kept mum on their plans, particularly Tan Sri Syed Mokhtar Al-

Bukhary’s Puncak Semangat Sdn Bhd, which had received 40MHz of the 2.6GHz

spectrum.Although some question the delay in the deployment of 4G-LTE services to the

masses, there has been no announcement even by the MCMC on a deadline for the

telcos to roll out the network.For YTL Communications Sdn Bhd CEO Wing K Lee, the decision for YES 4G to delay

the rollout of 4G-LTE network is a calculated and carefully weighed one.“In my opinion, 4G-LTE is a 2014 story. If MCMC tells us that we must deploy soon,

we are ready to do so on our WiMAX network. It’s just that we need the technology

to be more mature,” he said in an exclusive interview with The Edge Financial

Daily.“We will launch LTE when the time is right but that day is not today,” he added.The 2.6GHz frequency on which the spectrum runs is not the industry standard

across the world.In fact, countries such as the US, Australia, and Thailand use the 1.8GHz band to

deploy 4G-LTE, while others use either a combination of frequencies or the 2.6GHz.This poses a rather interesting challenge not only for telco providers but also

for device manufacturers which supply smartphones and tablets to consumers.“Devices are simply not ready yet. In fact, there is no such thing as 4G-LTE

roaming. No manufacturer can make a device which can accommodate all of these

frequency bands. If they do, it will be the size of a radio.“So naturally manufacturers will build according to the most popular band as in

the case of Apple’s iPhone which is built to accommodate the 1.8GHz band,” Lee

said.For more devices to be made on the 2.6GHz frequency, manufacturers would have to

see a compelling enough demand from the market, which is sorely lacking.China and India have said that they will run LTE services on the 2.6GHz band, but

this remains to be seen as China has yet to set a date to auction or award the

spectrum. India’s target to roll out services this year could be subject to

delays.“Until China and India hit critical mass and have solid plans to roll out LTE in

their countries, there will be a gap in devices specifically those that cater to

Malaysia’s specifications,” Lee said.Although some may grumble the allocation of spectrum was unfair as unknown entrant

Puncak Semangat had received the lion’s share, Lee is happy with the allocation

given to YTL Communications. “We think it’s good enough and also we have the

2.3GHz to run on. So Puncak Semangat gets 40MHz, it’s starting from scratch after

all,” he said.Lee was reported to have said that a key challenge for telco operators moving

forward is the “all-you-can-eat data pricing”, which he said is not sustainable”.Recent Reuters reports noted that consumers in the US were not taking up 4G-LTE

plans as much as operators would like them to. South Korean operators cautioned

telcos in other countries that the average revenue per user was insufficient to

recover the cost of investment involved in setting up the network.“The business model and cost structure are largely based on a telco’s voice

network with data as an add-on, but the reality is that it is now the other way

round.“Companies must embrace a data network and voice should be provided as an add-on,”

Lee said. According to a report by RHB Research Institute, YTL Communications is likely to

focus on implementing its RM4 billion 1Bestarinet project awarded by the

government in 2011 to provide WiMAX services to 10,000 schools in Malaysia.  

This article first appeared in The Edge Financial Daily, on 13 May, 2013.