… to the industry’s grouses.

Timedotcom has gone ahead and launched its fibre-to-the-home (FTTH) service, nearly two months before the much publicised and much anticipated FTTH services by Telekom Malaysia and even Maxis Communications. The most memorable thing about it? The general public had no inkling whatsoever that it would do so. Certainly not I. When I met TimeDotCom’s (TdC) CEO October of last year he had squarely stated: “Consumer is not a focus for us at all. Not at this point in time.”

Who’da think three months later TdC’s CEO would be presenting a compelling argument to a room full of media and industry-types at Mont Kiara, about why the consumers’ choice should be TIME Fibre Broadband.

Talk about disruptive; which is why whenever Afzal Abdul Rahim says something, I pay attention.

Why we have the broadband pricing we do
Afzal tries to justify pricing for broadband service in Malaysia: “If Malaysia had a dense population, it’s easy to deliver to urban areas, we’re fine. But, Malaysia has a 60 to 70% rural population. We all have got to supplement bringing broadband to high-density areas and low-density areas.”

Afzal goes on to say that at the end of the day, the RM88 for entry-level consumer broadband is not enough for service providers to recoup investments. And rather than “throw our toys out of the playpen” with childish pique and compare our so-called exorbitant pricing to the peanuts our neighbours are paying, we should be demanding our money’s worth, which is more bandwidth and better quality of service.

In other words, why compound the already bad quality we are getting by denying service providers the moolah they need to provide us the quality we should be getting in the first place? After all, are we not each one of us already signed up to a broadband service?  Why complain of expensive pricing only after the fact?

Demystifying definitions
Another gripe or rather, angle which Afzal tries to introduce into our already presumptuous mentality is that net broadband subscriber additions currently are based on penetration when it could best serve our purpose if it’s based on coverage.

“Basically, we’ve gotten it all wrong because we are looking at penetration as opposed to coverage.” That’s a bummer especially from an incumbent or service provider’s point of view because when it comes to port utilisation, many of the DSL ports around the country are not utilised. Afzal says: “We have 60 to 70% port utilisation.”

But, that isn’t all. There is also the matter of the penetration levels we are “expected” to have based on our GDP per capita. If our GDP per capita dictates Malaysia is already at the Internet penetration level it’s supposed to be at, GDP=Penetration.  One of these variables; GDP or Penetration; has to change.

So, how do we get more people to buy more broadband (penetration) and boost income levels (GDP per capita) in the country? Lowering prices isn’t an option because of the way the Malaysian population is located all across this country of ours.

“We compare ourselves to Singapore and Korea, but these guys have far more disposable income than we have.  So, we end up being frustrated because broadband is not working, penetration is poor, it’s perceived expensive and so on. At end of day, it’s because we are measuring ourselves with penetration; the propensity of one to purchase service as opposed to whether it’s available. This is the quandary we’re in.”

Internet penetration is the reality we have had drilled into us that really serves not much purpose at all, except maybe make us feel frustration about a situation that needs a change in perception.

So spare a thought for our telcos. Every time they perform below par when providing a service, stick to the issue at hand – the quality of the service. Don’t bring price into it, and most especially don’t start brandishing the 100Mbps speeds, free calls and free device perks that our neighbours down south are enjoying, because at end of the day, you are still stuck with the exact same quality you started out with.

Build it and they will come
Internet coverage instead of internet penetration, should matter. Especially in a country like Malaysia with its gaping digital divide and unequal sharing of wealth.  Now, service providers are scrambling among themselves to sign up existing broadband subscribers in all the usual saturated market areas instead of breaking new ground in new geographical areas like the small towns and villages.

Mobile Number Portability might have been a boon to consumers when it was first introduced. But the novelty is starting to wear off as subscribers keep hopping from one service provider to the next; they are starting to realise that the service quality and experience might only be marginally better and ultimately still bad. Can’t service providers put their investments to better use than confusing us poor Malaysian consumers? Like going into new markets?

That’s easier said than done. Our dearly beloved Minister of Information, Communications and Culture, Dr. Rais Yatim points out during the launch of another wireless broadband service. He says: “Pricing for broadband has to vary from community to community … it can’t be a blanket rate” adding that the idea is to reduce profit in faraway, rural areas, not cause loss.

But, that’s just it isn’t it? Building out infrastructure and service in an area that does not have demand and does not want it, already is a loss. And yet, we demand no less of our esteemed service providers. And we should.

Any business person would ask you how are you going to build out infrastructure in areas where there is no guarantee of return on investment. But if you are a government-linked company, and especially if you are the incumbent, your motivations aren’t the same as a private organisation’s anymore. Profit and loss aren’t supposed to fit into the picture. Even demand shouldn’t matter because the key phrase here is “supply-driven.” Former minister of Energy, Water and Communications Tun Dr Lim Keng Yaik used to say it over and over again: “Build it and they will come.”

The right to egg the industry on

TdC itself decided to target the upscale Mont Kiara market because it has existing coverage and infrastructure in the area. Along with it, it introduced never before used concepts in the local broadband industry like Boost, a service whereby subscribers are not confined to the base speed of their specific package. For example, TdC’s 2Mbps, 5Mbps and 10Mbps packages can exceed specified package limits up to 50Mbps for at least 10 hours every month, for free.

That’s an outrageous 50Mbps piped straight into the home for you to do high-definition video streaming with (theoretically) no buffer time. But, TdC wasn’t hiding behind theoretical speeds and actually claims that the service experience with TIME Fibre Broadband would be better because “it is essentially fibre from the house all the way through our exchanges, our nodes,to our sub cables leaving the country to the international cloud.”

But the statement of the day had to be when Afzal says: “Why are we doing 50Mbps? Because we can, because we feel like it and we’d like to enjoy seeing our competition catch up with us.” Disruptive, right?

So no matter that it is an infrastructure owner “kind of” competing in the same broadband retail market as other retail telcos who seek infrastructure access from it; the TdC CEO says its relationship with access seekers is “friendly.” The main idea is that there are more entrants into the fixed line markets: HSBB will be launching, Maxis is coming into it strongly, and TdC will be doing its own thing.

“I think 2010 will be a great year for Malaysian broadband,” Afzal summarises. I couldn’t agree more.