The last couple of weeks have been busy for the telco scene, particularly for one WiMax player in town.
YTL Communications launched its WiMax service, dubbed YES, but ran into problems immediately as its Web site was crippled and was not able to register users.
The latest WiMax player in town was off to a shaky start because barely an hour after its official launch on Nov. 19, it was allegedly hit by malicious attacks from unknown source or sources causing its Web portal to go down. This angered literally thousands who wanted to register their accounts but couldn't.
A lot has been said in social media channels about the missteps YTL experienced over the first 10 days of its service, so I won't reiterate those comments.
Suffice to say, launching a wireless network from scratch is actually a humongous task and instead of concentrating on beating the hype drum and taking potshots at its competitors, YTL should have just concentrated on preparing itself thoroughly and bringing whatever superior service they claim to have to the public--minus the hype.
Just as the dust settled on that, news reports emerged that the industry regulator, the Malaysian Communications and Multimedia Commission (MCMC), allegedly assigned a block of radio spectrum on a temporary basis or what is known as an "Apparatus Assignment" licence from the 700MHz range to YTL, and might have done so without the knowledge of other wireless players in the country.
Currently, a good part of 700MHz spectrum is being used for analog TV transmissions but the country is expected to move to digital terrestrial TV by 2015. This move will effectively free up a significant part of the spectrum for other usages, such as mobile broadband, given that digital TV will not require that much spectrum to carry content compared to that of analog transmissions.
This issue has therefore caused a huge furor among other wireless players. Such was the unhappiness that there were players demanding to see the prime minister over the seemingly lopsided assignment. The meeting took place last Monday, and the outcome was that the PM instructed the MCMC and the Ministry of Communications to review the whole situation and come up with proper guidelines on how to move forward by January 2011.
YTL's response to date is that it wants the 700MHz to launch its pay-TV services slated for next year and not for mobile broadband services, and has gone on record to say it has no interest in blocking others from using that band.
Pursuant to the meeting with the PM, however, YTL was asked to clarify the situation but company officials declined to comment further.
The 700MHz spectrum is crucial because it can give players using it far wider coverage and better in-building penetration. This would mean that less capital expenditure would be needed to cover a given area than if higher frequencies were used.
Despite YTL claiming it will not use the 700MHz spectrum for mobile broadband, deploying it only for TV, the industry was still antsy about its assurances because YTL could argue at a later date that its pay-TV service is part of the convergence game of voice, video and data services.
This reasoning could then be used to possibly justify its ownership of the 700MHz licence as part of a mobile broadband offering, thereby, helping it to keep it for its own use or having the option of renting it to others. Both cases would severely impair the competition from growing.
The argument that the 700MHz spectrum could be used for mobile broadband at a later date is further exacerbated by a recent study conducted by the Boston Consulting Group which suggests that "if governments were to allocate the 700MHz band for mobile broadband deployment, it would bring much greater economic and social benefits to Asia Pacific than if allocated for services such as broadcasting."
The study--commissioned by the GSM Association which covered Korea, India, Indonesia and Malaysia--suggested that an increase in Internet adoption resulting from widespread mobile broadband deployment would create more than 44,000 new jobs by 2020, with many in rural areas in Malaysia.
If indeed the assignment had really been done in a shroud of secrecy, especially if some kind of quid pro quo arrangement had been brokered behind the scenes, it begs the question as to whether it could set a precedent for other "backdoor channel arrangements" to be made in regard to spectrum allocation.
While the alleged spectrum assignment to YTL is a temporary one under the auspices of "apparatus assignment" and MCMC can indeed pull it back later, and while several press reports may have played up the issue, a wireless industry executive familiar with spectrum assignment matters has noted that the industry as a whole is most disconcerted because of the uncertainty and the non-transparency of the whole spectrum assignment process.
This executive speaking on condition of anonymity said that efforts were made before to clarify spectrum issues but no information was forthcoming from the regulator.
Expressing surprise over this issue reported in online portals, the executive noted that the industry has been caught off guard by these developments and can't but feel it has been left out of the consultation process and that there has been a lack of transparency as to how this matter has been handled.
"This is about the long-term future of the industry. At least now there is a directive to look at this matter and it can't be a white-wash anymore. The government, through the regulator must now be more forthcoming with its answer. If anything, this is the good that has come out of it."
While it remains to be seen what develops next January, the government via MCMC has to handle this issue with great delicacy and complete transparency to ensure the process of assigning spectrum is treated in the most non-partisan way possible.
This is the only way to dispel whatever miscommunications and misunderstandings which may have arisen as a result of this entire fiasco.