Telekom Malaysia Bhd (TM) plans to spend up to RM3bil in capital expenditure (capex) this year as it continues to roll out high speed broadband (HSBB) access to more areas and expand its Internet access beyond homes and offices via WiFi hotspots.

“We are looking to invest RM2.7bil to RM3bil in capex this year to provide access, build our core network and support systems. We will continue to invest in HSBB but increasingly our expansion would be based on a demand driven model,” TM group chief executive officer Datuk Seri Zamzamzairani Md Isa said in an interview.

As at third-quarter 2011, the telco had invested RM1.4bil but Zamzamzairani would not say what the final figure was for the full-year capex. TM’s capex is normally internally-funded.

“The capex for HSBB will slowly taper off since a lot has been spent on building the access for the supply driven model,” he said.
The investment in HSBB has been going on for the past few years and the telco has wired up 1.1 million of the 1.3 million premises it was supposed to provide with HSBB under the first phase.

The 1.3 million premises were based on a supply driven model but any roll out after the 1.3 million would be based on demand roll-out.

TM now has 200,000 Unifi subscribers.

On WiFi services, he said: “Previously our focus has been on providing access via fixed lines to homes and offices but the minute our customer walks out of the home or office building, he stops being our user. Eighty per cent of the time the user is in offices or shopping malls and that means we can still provide network access to him.

“We see this as an area of opportunity for us to have TM WiFi in different locations to cater for our nomadic users. It is a segment of the market that we can tap into going forward,” he said.

“We want to add more hotspots in the country, especially in the cities and major towns and we will bundle WiFi with our Unifi offering for our high-end users.

“We also want to have a prepaid WiFi offering to capture more users onto our network,” he added.

TM has about 17,000 hotspots in the country and while he did not say how many more would be added this year, any move in that direction would be aimed at supplementing coverage of its Unifi so as to provide its customers “ease of use”.

“The key places where users are most likely to be needing WiFi is in the shopping malls and universities more so since all smart devices are WiFi enabled,” he said.

There are 448 shopping malls in the country, of which 183 are TM WiFi enabled hotspots.

By April, Kuala Lumpur City Hall has mandated that all eateries in the city which has a floor space of 120 sq m or more to provide WiFi at their premises.

It is the growth in demand for data services that is forcing operators like TM to expand into providing WiFi services and if it does not focus on this area, it would be a loss of opportunity for the telco.

Having a fibre-based backhaul also allows it to carry more traffic than others although TM would be up against its wireless and cellular rivals which can provide mobility to their users.

“A lot of users get logged out when there is an overload in data traffic in a particular hotspot but we have the advantage as our backhaul is controlled by us.

“So user experience really depends on the backhaul, and we are also in talks with other players that want to ride on our network to offer WiFi services,” Zamzamzairani said.