Afzal needs better arsenal to fight the fibre-optic war
IN four days Afzal Abdul Rahim covered all the booths that he could find in six halls at the recently concluded Mobile World Congress (MWC).
You may wonder what was the head honco of a fixed line company doing at a mobile congress?
Spying, would be the obvious answer.
Others from the fixed world were also there but he stopped at every booth, found out what he wanted before moving to the next. This is the congress where geeks, vendors and techo guys meet every year to craft the future of the industry.
It is also a showcase of future technology, applications and devices. MWC is also the base where jobs are negotiated as a lot of CVs are circulated.
I guess he had to pay for excess baggage for carrying nearly 20 kilos of brochures he brought back. But knowing him, and his witty self, he may have gotten across for free.
And after getting around through the halls he had time to find some Indian restaurants for thosai and tandoori.
I am talking about Barcelona and he is the CEO of Time dotCom Bhd (TDC). This man can't resist mamak, Indian food and teh tarik.
He was there to find out what the future trends were so that TDC could arm itself to tap the areas of opportunities.
From the congress it is clear that data rules, and voice is down.
Data is growing and will grow at a faster pace as more people become comfortable with socialising, buying, selling and doing transactions online.
Since fibre can carry a lot more data, it will play a bigger role going forward and that is why the two bigger celcos are already working closely with Telekom Malaysia Bhd (TM).
To recap, TDC was a company with big ambitions, big plans, but nothing materialised. It was bleeding for years since its listing in 2001 and many people lost a lot of money investing in this stock.
Its balance sheet had been flawed with red ink and in 2007 it reported RM160mil net loss. Afzal joins the group in late 2008.
Today TDC is a different creature.
From merely owning fibre, TDC has shaped up to have a data centre, a global IPT network, an equity in the Trans Pacific Cable System - running from Singapore to Japan and onto the United States in which Google is also a partner. It now carries some traffic from Thailand to Malaysia and onto the US.
It is carrying digital TV content for Astro and has 30,000 buildings wired up. It is fiberalising DiGi's network.
After Barcelona he sprang a surprised - TDC delivered triple growth in net profit to RM107mil for FY10. Revenue was up 27% - percentages never heard of previously - to RM317mil.
All this was led by higher contributions from data, particularly wholesale and global bandwidth segment. But its market share is only a meagre 5%, incumbent TM has the rest.
He is tough and results-orientated and wants the market share to rise to 10% and his aim is for TDC to be a regional wholesale player. This is another big ambition!
It will be tough as he is up against TM, and also the mobile boys, which are beefing up operations to ride the big data boom and they are all out for the same small and medium enterprises and corporate market.
TDC also has its share of problems. Deployment is its biggest issue, bureaucracy a hurdle, it is a capital intensive business and there is no common utility planning.
It is also not on analyst radar screens and by market capitalisation it is no where near TM, whose market cap is seven times bigger than that of TDC. It is RM14.2bil versus RM1.92bil.
Afzal is the 14th CEO of TDC. Perhaps TDC has finally gotten its acts right.
And no doubt Afzal has delivered seven quarters of profit, the journey is far from over as the war of fibre has yet to be fought. Its advantage - being small it has control over cost and pricing and can be as competitive as the bigger boys.
With the better results, Afzal has already waved his magic wand, perhaps he now needs a better instrument to fight the fibre war.
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