XL Axis Axiata Forum Axiata Sees Data as Key Growth..
Axiata Sees Data as Key Growth Driver, Various Developments Underway to Improve Axiata Sees Data as Key Growth Driver, Various Developments Underway t9 Years AgoKUCHING: Axiata Group Bhd
(Axiata) sees its data business segment as a key growth driver for the group as
its core business in voice and SMS have been declining. In its annual report, it said
that data growth has been strong across all its markets and is currently a
material part of its revenue, particularly in more mature markets. Celcom, XL,
and Dialog in particular, have seen continuous growth in data contribution to
revenue now at 17, 23 and nine per cent respectively, it said, and noted that
Celcom’s data revenue for smartphones and tablets saw a 35 per cent growth in
2013. “We have been proactively making significant
investments and enhancements to our networks, support systems, organization
structure and business models to strengthen our data capabilities. “We have modernized our networks
in Celcom, XL and Dialog to be optimized for data via the conversion of our
core networks from all ‘switch based’ network to ‘IP-based’ network, including
transmission backhaul. “The new networks are not only
more efficient for data, but also for voice, and will require significantly
lower operating costs,” said Axiata’s managing director and chief executive
officer (CEO) Datuk Seri Jamaludin Ibrahim. He added that as such, the group
is constantly investing in new technologies, and technology migration from 2G
to 3G, and 3G to 4G LTE will provide better user experience with a much
improved cost efficiency. “Celcom and Dialog are already
expanding their 4G LTE networks to enhance ultra-high speed broadband network
reach. XL is preparing to merge with the recently acquired Axis network and at
the same time upgrade their network to capitalize on the newly acquired
spectrum.” On a regional basis, in 2013, the
groups have invested more than US$2 billion to acquire new spectrums in
Bangladesh, Sri Lanka and India for 2G, 3G and 4G services. Robi in Bangladesh acquired five
megahertz (MHz) of paired 2,100MHz spectrum, Dialog acquired 10MHz of paired
1,800MHz spectrum while in India, its associate Idea acquired five MHz (on average)
of paired 1,800MHz spectrum in 11 circles (out of 22) and five MHz of 900MHz
paired spectrum in the Delhi metropolitan circle. In Indonesia, XL’s acquisition of
Axis provided XL with an additional 15MHz of paired 1800MHz spectrum and the
new spectrum will facilitate further growth at a lower incremental cost. The group CEO further highlighted
that the company have also set up two new business units to spearhead its
ventures in to new revenue streams, one of which was the company; edotco group,
to own and manage Axiata’s group-wide passive network infrastructure. The
edotco group would unlock the value of its assets by driving new levels of
operational efficiency in passive infrastructure management while diversifying
its revenue streams with the construction of 13,000 towers in Malaysia, he
outlined .edotco Group is also one of the largest tower companies in Southeast
Asia and internationally, with towers built in Bangladesh, Sri Lanka and
Cambodia. Axiata has also developed the Axiata Digital
Services unit to focus on digital entertainment, digital commerce, digital
payment, and digital advertising services. Aside from that, Jamaludin have also
expanded its digital platform with the launch of various digital services. He said, “We have launched ‘Escape’,
the digital OTT entertainment service in Malaysia via Celcom; acquired a stake
in ‘Anything.lk’, the biggest digital commerce company in Sri Lanka; and
launched ‘Elevenia’ in Indonesia (in March 2014), a digital commerce business
in partnership with SK Planet, a subsidiary of SK Telecom. “Our investments in these digital
service businesses are important to strategically position the group in the
‘digital world’, in providing synergies and complementing our core business,
whilst building Internet and digital skills within the group. “The group has
also reorganized its procurement and treasury operations into centralized
business operations for the group. “The Axiata Procurement Centre (APC) focuses
on optimizing our network and IT expenditure, which is the majority of group
spend. By standardizing and aggregating our demand across our OpCos, and
implementing common systems and processes, we will increase value from our
suppliers such that all OpCos will be in a position to benefit from Axiata’s
scale,” he explained. Meanwhile, the newly setup Axiata
Treasury Centre (ATC), expected to be group wide by 2014, are expected to
improve the group’s managing cash, strengthen operation balance sheet, ensure
efficient capital management and strengthen financial risk mitigation, which
includes interest rates and foreign exchange (forex). In a note, Axiata added that the
group spends about RM4 billion in network capital expenditure (capex) and more
than RM1.5 billion in network operational expenditure (opex) yearly, it has
reviewed the cost structure of our operations to reduce its cost further. “In-country network sharing with other local
players, from cell sites to fiber and microwaves, and in the future active
network elements, will also substantially alter the cost structure of our
networks. “Our operating entities are already
collaborating with other operators in their respective markets to share and
reduce spend in passive infrastructure and transmission,” Jamaludin commented. Source: |