Healthy growth for cellular and outsourcing

  • Business
  • Wednesday, 29 Dec 2004

CELCOM (Malaysia) Bhd has come up with a powerful and dynamic proposition following the successful completion of its integration programme, says group CEO Datuk Ramli Abbas. 

Aiming for further integration of services, Celcom has ambitions to regain its pole position in the country's telecommunications industry. 

Ramli sees a major challenge in 3G near-future developments in personal and business wireless technology, especially mobile telecommunications. 

Datuk Jamaludin Ibrahim, CEO of Maxis Communications Bhd, expects a healthy growth in the industry, which will see new trends and usages for handsets. More SMS users will be getting information and other services, while handsets will be used for camera, MP3 and PDA functions. 

At Mesdaq-listed Symphony House Bhd, business process outsourcing will be the next growth area, supported by Government policies and a growing list of multinational clients. 

Executive director Abdul Hamid Sheikh Mohamed expects IT spending to continue strongly in tandem with the economic growth.


DATUK RAMLI ABBAS Group Chief Executive Officer Celcom (Malaysia) Bhd 

How do you see revenue growth in 2005? 

Very positively. The successful on-time completion of our integration programme has given Celcom a very powerful and dynamic competitive proposition. We now have the economies of scale to compete in the marketplace and win customers on all fronts - voice, data, and multimedia including e-mail and beyond services, anywhere, anytime. 

Our value is the integration of our services, the things our customers want to experience – our helpful customer care team, our new interactive voice response (IVR) system, our open platform that’s flexible with over 9,000 business application partners, our versatile wireless mobility that is more process-centric than technology-centric which makes deployment easy. 

With the networks 019 and 013 fully integrated, we are consolidating a lot of our products, solutions and services. It is now easier for our customers to experience our similarities and new phases. 

This integration is a major rollout to our customers and the marketplace to use our services. At the same time, our focus on nurturing our customers from younger to older age profiles by providing relevant and useful services and exceptional Celcom brand experience is delighting our customers and starting to generate excitement in the marketplace. All these in turn should enhance our average revenue per user (ARPU) results.  

How is your company positioning itself to stay ahead of the competition? 

Our commitment to innovation is to position Celcom as the country’s premier total mobile telecommunications company, which empowers our customers to have technology in their hands – connecting people to people, people to devices to machines, devices to devices and machines to machines, anywhere, anytime. 

Moving ahead, we are widening our reach and increasing our depth in broadband access technologies, data and content and third-generation mobile technologies to lead the business enterprise sector while widening creative innovations to excite and delight the consumer marketplace. 

Our value ultimately resides in our ability to deliver a superior end-to-end mobile connectivity service to our customers at anytime, anywhere. 

We monitor our performance internally and suggest that our customers and other stakeholders track us against performance metrics such as subscriber growth, revenue and operational efficiency. 

Nationally, we now have the most comprehensive network coverage covering 95% of the populated areas in the country. Internationally, Celcom is already offering global roaming services in more than 90 countries over almost 200 networks worldwide.  

What do you see as some interesting trends next year? 

If you look at it today, I would say “wireless” would set new and interesting trends in our environment. 

You may begin to see more and more individuals and business people just regularly walking around with multiple devices on their bodies. They are all connected almost full time to the Internet, the Intranet, their desktops, and you can see transactions flowing through those networks and so forth.  

I think we are now at the onset of wireless data really being the key driver of demand. It will be a very crucial part of the communications industry moving into 2005. At Celcom, we will be a significant part of that. 

We plan to enable these new technologies to deliver innovative integrated solutions and services to our customers, but more importantly we plan to work closely with our enterprise customers to help them develop the right business case to contribute to their success. 

We are not strangers to business application; we already have what is called Celcom Integrated Business Solution (CIBS). Recently, we introduced E-mail & Beyond in association with Microsoft Malaysia, a world-class solution provider. E-mail & Beyond enables Celcom mobile customers to access e-mail anytime, anywhere via Microsoft Windows Mobile devices and WAP/GPRS-enabled phones. 

Together with TM Net, our associate company, we introduced the Celcom WiFi Service, which allows customers to enjoy wireless broadband Internet access via SMS.  

This takes us back to our business strategy of positioning Celcom as the premier total mobile telecommunications company – connecting not only people to people but also people to devices and devices to devices. This is the future for Celcom to win and regain pole position in the country’s communications industry. 

What would you say are the challenges for the sector in 2005? 

The challenge would be 3G near-future developments in personal and business wireless technology, especially mobile communications. 

Capabilities such as enhanced multimedia (voice, data, video and remote control); their useability on all popular modes – mobile phones, e-mail, paging, fax, video-conferencing, and Web-browsing; broad bandwidth and high speed from 2 megabits-per-second (Mbps) upwards; routing flexibility (repeater, satellite, local area network/LAN); operation at about 2 giga hertz (GHz) transmit and receive roaming capability throughout Europe, Asia and North America. 

We are already advancing our work in exploring the market potential in 3G and in line with this, we have expanded and enhanced our mobile data services. On the infrastructure aspect, we are in the midst of evolving our network and technology from a 2G/2.5G to 3G or other related technologies. 

In this respect, the assignment of the 3G spectrum to our parent company, Telekom Malaysia Bhd, has conveniently given us the edge to adopt 3G technology. 

We believe the telecommunications industry will continue to be led by market demand and technological advancements and Celcom is well positioned to meet the challenges ahead. 

What is your view of the cellular business and how do you see the performance of the other aspects of your business? 

The cellular business will grow like the Taiwan model to 120% penetration, which translates into each person using more than one device to communicate. This is where we’re heading. 

With the completion of network integration in October 2004, Celcom is able to aggressively focus its efforts on capturing more market share and managing its distribution channels effectively as well as introducing new innovative products and services. 

We are moving forward, maintaining the growth momentum in new subscriber additions over the next few quarters. We are going to try really hard, even though we know it is not going to be easy since it is a very competitive market.  

Our challenge going forward will be to come up with more value-added products and services compared with the cash-cow business of voice and data calls. More value-added services mean more growth in “margins”.  

 CELCOM :  [Stock Watch]  [News


ABDUL HAMID SHEIKH MOHAMED Executive Director Symphony House Bhd 

How do you see growth for your business in 2005? 

We expect our businesses to continue to record reasonable growth in 2005, carrying on from where we left off in 2004. With the economy, barring any global economic shocks, expected to grow at a healthy rate in 2005, we expect IT spending to continue to grow strongly in tandem.  

On the managed services side, we are particularly bullish about our latest addition, the business process outsourcing (BPO) segment. This industry has been growing at a compounded annual growth rate of 35% in the last one year globally and is expected to be worth over US$680bil by 2008. And only 5% of the new contracts are in Asia.  

So, we expect Asia to catch up, especially as we are seeing more multinational corporations (MNCs) setting up or expanding their presence in the region. China’s spectacular growth will also contribute to Asia’s expected strong growth in this sector. 

We expect to cement our position in this segment in the region via our subsidiary, Vsource Asia, by acquiring more MNC clients. 

Whilst the take-up rate in BPO among MNCs is high, among Malaysian companies it is still negligible. The Government has also recognised this and has taken steps to promote such industry and encouraging more take-up by Malaysian companies.  

So we hope to follow suit and catalyse Malaysian companies to outsource more in the coming year. 

How challenging has it been operationally? 

2004 has been a very challenging year for us, trying to keep pace with worldwide developments and trying to make that quantum leap from a small base. We are still very young as a company - only about two years old - with a lot of catching up to do to keep pace. We have set high standards for ourselves, but the results have been pretty satisfying. 

The biggest challenge for us has been to find that niche area, the new growth area where it is less crowded, where we can position ourselves well and make a presence not just domestically but also internationally.  

At the same time, for a young group that has grown largely by acquisitions, going through the integration processes without affecting operations was crucial. We are pleased that things have gone quite smoothly. 

Operationally, we face largely the same issues as most others - pricing pressures, long sales cycle and stiff competition in some areas of our business. 

What are the steps taken to keep growth rates high? 

Our growth strategy is based on keeping the balance between organic growth and acquisitionof related and complementary businesses, to leverage on the benefits of economies of scale and productivity gain.  

As we are in the service-based industry, our people are our main asset. Thus, the focus is on ensuring our people are capable, productive, efficient and up to the mark. We achieve this by ensuring that they are well trained and properly rewarded. We also ensure that they are aligned to our shareholders’ interests. 

At the same time, we strive to continuously improve our service delivery and exceed customers' expectations by adopting technology where possible and relevant, so that our customers do not just come to us to get the cheapest products or services.  

Are there any specific products or areas where you expect to make a breakthrough? 

Our vision is to create value through innovative transformation, and to achieve that, we have to continuously improve all our products and service delivery. Where possible, we adopt technology to achieve this. We aim to do this across all our businesses. 

If I have to single out one area, we believe the BPO business has the most potential given that this is a new area yet to be exploited by Malaysian companies.  

How has listing on Mesdaq been helpful to your company? 

The listing on Mesdaq has been of tremendous help in allowing us to make that breakthrough and grow our business at an exponential rate.  

It has given us the ability to raise capital to achieve our strategic plan and grow both organically and via acquisitions. For example, we have acquired companies using our shares as currencies as well as raised capital to allow other acquisitions.  

At the same time, it has increased our profile and credibility and allowed us to acquire more clients. 

 SYMPHNY :  [Stock Watch]  [News


DATUK JAMALUDIN IBRAHIM Chief Executive Officer Maxis Communications Bhd  

How do you see revenue growth in 2005?  

We expect our revenue and subscriber growth to be in the low to mid-teens.  

How is your company positioning itself to stay ahead of the competition?  

We will continue to differentiate ourselves more through better quality network and customer services, as well as through product innovation to provide better value to our customers.  

What do you see as some interesting trends next year?  

We’ll probably see more phone users shift from using SMS just for communication to getting information and other services, from using text messaging to picture and video messaging, and buying new handsets not just to communicate, but also for other non-voice features such as the camera, MP3 and PDA functions.  

What would you say are the challenges for the sector in 2005?  

The industry will still be growing next year and will remain healthy although competition is expected to be stiffer.  

Network rollout will be challenging, as we will have to construct more sites than ever, especially in light of the Government’s call for increased coverage.  

 MAXIS :  [Stock Watch]  [News]

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