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Tuesday, August 08, 2006

Telekom Malaysia - how to reverse the slide in fixed line subscriptions?

Somehow, Telekom Malaysia or TM is mourning the loss of subscribers of its fixed line service to the mobile industry. The fixed line business is losing money since 2004 and the penetration share of fixed line availability in Malaysia is falling steadily from around 63% a couple of years back to now 58% or so. By the way, the company is not alone. Many companies, in other countries, suffer the same fate.

But at least, it is cannibalising itself, at least partially, since it also has a mobile arm. However, this mobile arm will also be threatened if the usage of free VoIP, such as Skype is becoming more widespread in Malaysia. In addition, TM's major competitor, Maxis, is aggressively promoting services at a lower cost, something, that is bound to hurt TM.

Lucky to the company, it also pushes the usage of broadband usage via its Streamyx service. Malaysia is still well underserved in broadband, even so penetration is increasing. What is missing to convince customers of its service, so, is customer orientation. So far, many customers complain about lackaistral attitude of the Telekom Group. One analyst is quoted as saying: "“Stories of Streamyx broken down and residential areas which do not have broadband are not unheard of .” Until those complaints are past, well, until then, TM better worries about its revenues.

(By Asia Business Consulting)