Although TM hopes to attract the heavy home user with the Unifi package to stem its market share losses, the action for mobile market has shifted to the lower end of the demand spectrum where operators are jostling to capture the nomadic user and the entry-level user. With a plethora of mobile devices including tablets going to flood the market in 2011-12, we anticipate the market will become further segmented between existing users and nomadic users and wireless operators casting their net further into semi-urban areas like Terangannuand Perlis to gain further subscribers.
The outlook for Malaysia gets more interesting due to a number of factors.
- Malaysia saw its first wholesale deal when Maxis signed a 10-year agreement with TM for using its HSBB subscribers. This marks a clear shift in TM's strategy that realizes it needs to balance its investment risk.
- LTE licensing for 2.6 GHz anticipated in 2011 has raised more expectations with rumors of two licenses being issued. LTE is expected to help the top three operators add more capacity to serve the expanded base.
- Operators like Celcom and DiGi have also announced that they will focus equally on growing the small-screen users, i.e. smartphones. Smartphone penetration in Malaysia stands at 20% and is expected to grow to 60% by 2015, leading to a further growth in mobile data. The key question is how do the top three operators optimize their networks and investments without losing market share in the mobile broadband market.
- Greater network sharing by operators like DiGi and Celcom are also signs that the market saturation is accelerating the need for cost optimization.
- To improve the customer experience Celcom, the net gainer from the mobile broadband growth, is investing more in branded retail outlets to improve the sampling of data packages and enriching the value proposition.
With more than eight operators boosting supply, greater purchasing power and falling prices of computing devices, Frost & Sullivan anticipates robust growth for the Malaysia broadband market both for small-screen and large-screen broadband users. Large-screen broadband users are expected to grow from 3.6 million to 7.8 million by 2015, of which over 5.6 million subs will be mobile broadband users. We also anticipate smartphones to play a significant role in the future of small-screen users, increasing users from the current 2.2 million to 12 million users by 2015.
Jayesh Easwaramony is VP of ICT practice at Frost & Sullivan Asia Pacific. For more info go to www.frost.com or email [email protected] or [email protected]