M1 to increase focus on enterprises

The mobile operator closes fiscal 2005 on a positive note, and is now eyeing the 3G, wireless broadband and enterprise markets.

SINGAPORE--Boosted by positive growth figures last year, MobileOne (M1) has set its sights on strengthening its footprints in the 3G, wireless broadband and enterprise market segments.

Speaking at a briefing to announce the company's fiscal 2005 (ended Dec.) results, M1 CEO Neil Montefiore, is bullish about the prospects of 3G this year. About 2 percent of M1's total customer base are currently 3G subscribers, he said.

As telecommunication operators face declining revenues from low-cost voice calls, many are looking at ways to boost mobile data usage through 3G (Third Generation) services and multimedia messaging service (MMS). Indeed, the launch of M1's 3G services last year had increased mobile data usage among its customers by 32 percent, to more than 2,000GB (gigabytes).

"We'll see 3G continue to grow, and we hope revenues for 3G services will become more significant in 2006," Montefiore said, noting that the uptake of such services is largely driven by the design of 3G phones. "The ones you saw over last Christmas were reasonable, but they would get even better this quarter."

Business sense
The CEO also singled out enterprise customers as a source of growth for M1 this year, as 3G can stimulate data usage and expand the scope for new enterprise applications.

"We'll invest our resources significantly to provide services in that market," Montefiore said, and added that M1 will build on its relationship with Vodafone to address the needs of enterprise customers. Currently, M1 has exclusive rights to sell a "BlackBerry from Vodafone" solution to corporate, small business and individual customers in Singapore. M1 customers are also offered a single fee for data roaming across Vodafone networks.

Wireless broadband access (WBA) is also one of the company's key focus areas this year, Montefiore said. On Tuesday, M1 announced WBA trials with mesh Wi-Fi and pre-WiMax equipment, with commercial services expected to debut by the end of this year.

M1 ended last year on a cheery note, with a majority of new subscribers flocking to its prepaid cards. The company's profit after tax for fiscal 2005 went up by 4.6 percent to S$161 million (US$98.7 million), while service revenue grew by 3.5 percent to S$704.9 million (US$432 million). Its shares closed at S$2.18 (US$1.34) yesterday.

It added 83,700 new customers last year, of which prepaid customers formed the majority. Montefiore noted that postpaid subscriber numbers remained "stable" at 809,000, while the company's prepaid customer segment grew 20.4 percent to 436,000. This was largely fueled by the popularity of the "free incoming calls" prepaid card, he said, which M1 was the first among Singapore's mobile players to launch last February.

Postpaid customers, however, remain the bread and butter for the company, contributing 89 percent of mobile revenues last year. M1's postpaid market share stands at 29.7 percent, behind market leader SingTel which M1 estimates to be over 40 percent.

While the company's prepaid market share is 27.8 percent, Montefiore cautioned against casting the numbers in stone as Singapore is in the midst of registering all new and existing prepaid cellphone users as part of a national security exercise. Prior to the security measure which was announced in November 2005, prepaid subscribers were not required to register and provide some form of identification.

Montefiore said there would likely be a reduction in the reported figures after prepaid cards that were not registered, and that were inactive, are terminated.