KUALA LUMPUR: Tricubes Bhd, which launched the 1Malaysia email project last month, is approaching four government agencies to use its email service to send bills, notices and statements to end users.

Its CEO Khairun Zainal Mokhtar said the company was in talks with Polis Diraja Malaysia (PDRM), Dewan Bandaraya Kuala Lumpur (DBKL), Jabatan Pengangkutan Jalan (JPJ) and the Employees’ Provident Fund (EPF) about the project, and would begin pilot trials with two agencies this month.

“These agencies are our existing clients that are currently using our biometric systems. This is on our best effort basis as we have to sell and market to them without any help from the government,” he said at the media briefing of the 1Malaysia email project or myemail yesterday.

However, he declined to reveal the identity of the two agencies.

Khairun said agencies should use the myemail service as it would cut down costs by 48% to 80%, compared to traditional delivery via snail mail.

“Agencies would save on their printing, distribution and storage costs. Apart from expediency in collecting details, their cash flow would also improve and there will be less wastage of paper,” he said.

Khairun said 50 sen would be charged to agencies when statements, notices and bills are delivered to myemail users. He clarified that there are no charges when agencies send ordinary emails.

To recap, the 1Malaysia email project was first announced by Prime Minister Datuk Seri Najib Razak under the Economic Transformation Programme (ETP) in April. It is expected to generate a gross national income of RM39 million by 2015 and was awarded to Tricubes.

The email project is intended to become the digital channel for government-linked organisations to communicate with the public.

Under the key performance index (KPI) set by the Performance Management and Delivery Unit (Pemandu), Tricubes is supposed to have 5.4 million users by year-end. It also has a target of 50% take-up rate for those aged above 18 years by 2012 and 100% by 2015.

However, Khairun said the 5.4 million target is a tall order as it has only 3,000 subscribers since its official launch on Sept 14.

“We told Pemandu that we started late,” said Khairun, adding that Tricubes has a much lower internal target.

Khairun said the 3,000 users were signed up during the trial period of myemail and only half of them are authenticated with a biometric device. He said Tricubes plans to begin marketing next month to get more subscribers for the myemail.

Founded in 1997 and listed on the ACE Market in 2004, Tricubes is an IT-based company focused on developing identity authentication solutions.

It has been involved in the deployment of the MyKad systems and has supplied 500,000 biometrics software to government bodies and private companies nationwide. Tricubes has 60% share of the local biometrics market.

“However, the market has become competitive which began to affect our margins. This is why we decided to diversify and came up with the myemail project as we saw potential for growth,” he said.

Tricubes will invest RM50 million in the myemail project over the next 10 years.

The email project is seen as a lifeline for Tricubes as it has been categorised as a Guidance Note 3 (GN3) company and is required to submit its regularisation plan by Oct 28.

“We have appointed M&A Securities Sdn Bhd adviser and we will be submitting the plan by then. We have some new business in the pipeline which we are looking forward to,” said Khairun.

He said the new business will not be related to myemail but is technology-based and will be a new revenue stream for the group.

Khairun added that Tricubes is expected to record minimal profits for FY12 ending March 31, after making a net loss of RM719,300 in FY11.

Tricubes expects the email project to only contribute to group revenue from FY13 onwards. Apart from charging agencies for sending documents, Tricubes will also rent out advertising space on the email portal to generate income.

Tricubes has already signed up with four partners — JackCow, WeddingKami, Allscript and Tutor.com — to offer value-added services on the email site. Myemail uses the Microsoft Windows live platform and cloud technology.

For the first quarter ended June 30, 2011, Tricubes posted a net loss of RM1.2 million on RM1.14 million in revenue. It rose half sen to close at 14 sen yesterday.

This article appeared in The Edge Financial Daily, October 6, 2011.