M'sian operator bets on new tariffs for 3G growth

Latecomer to Malaysia's 3G market, DiGi unveils new service plans to appeal to wider user base. However, operator still faces tough competition, analyst says.

PETALING JAYA--In a bid to drive broadband adoption in the country, Malaysia's DiGi Telecommunications has unveiled new tariff plans it says will attract more customers to its 3G mobile service.

Launched earlier this year, the operator's 3G service then was targeted primarily at fixed broadband subscribers and delivered only via a 3G-enabled USB dongle.

Speaking to the local media Thursday, DiGi CEO Johan Dennelind said it has since garnered 30,000 3G subscribers and is now ready to extend the service to mobile phone users.

He said the company's network currently covers 59 percent of the population in the Klang Valley, ahead of the 44 percent previously targeted for deployment over the next three years.

"We believe that now is the time for us to extend our services to mobile users so that they can experience 3G on their mobiles, too. But, before we did that, we had to ensure the minimum requirements of quality and coverage were met," he said.

Dennelind reiterated that DiGi is unfazed by its late entry into the 3G market, behind main rivals, Maxis and Celcom. DiGi is the country's third largest mobile operator in terms of subscriber base.

"Being late is not necessarily a bad thing. Based on the feedback we've received, our customers are happy with the quality and coverage of our service," he said. "Also, our proposition is not about a product but rather about a lifestyle. It's about giving the best deal in terms of quality and affordability to our customers."

DiGi's new tariffs comprise five new plans, which the company said were designed for a wider variety of subscribers including prepaid and postpaid users, and specifically tailored for BlackBerry smartphone users.

Loh Keh Kiat, head of product marketing, said the new offerings give the company a competitive differentiator factor in that there is now a plan for every category of user.

"For example, our BerrySmart Plan, is designed for those wanting to use mobile data together with their voice, SMS and MMS services," Loh explained. "Customers will enjoy rebates of up to 100 percent upon the bill reaching 200 ringgit (US$59.3)."

Still an uphill climb
According to an industry analyst, as a late market entrant, DiGi faces some challenges in its bid for a share of the local 3G market.

Marc Einstein, Asia-Pacific industry manager for mobile and wireless communications at Frost & Sullivan, said this week's launch of its 3G service on mobile phones would have little impact on subscribers already using DiGi's EDGE (Enhanced Data Rates for GSM Evolution) service.

"EDGE users would experience faster speeds, which is good, but overall user experience for these customers would not be significantly better," he told ZDNet Asia in a phone interview.

And while it may now offers 3G mobile phone service, Einstein said DiGi would still have to compete with other established players for market share, including non-3G operators such as WiMax service providers.

However, he noted that introducing more competitive and innovative pricing and tariff plans can help DiGi boost its market share.

"There is a still room to grow broadband adoption in Malaysia," he said. "But, it's going to be a tough battle ahead as DiGi needs to compete not only with Maxis and Celcom, but other players such as WiMax player Packet One, and the rest."

Edwin Yapp is a freelance IT writer based in Malaysia.