Questions over how Broadnet will fit into the national plan to roll out cost-efficient HSBB services.
Details still sketchy as the newcomer has no track record in broadband
PETALING JAYA: With the signing of a partnership agreement between Telekom Malaysia Bhd (TM) and Tenaga Nasional Bhd (TNB) on Tuesday, analysts are now raising questions over how Broadnet Network Sdn Bhd will fit into the national plan to roll out cost-efficient high-speed broadband (HSBB) services.
RHB Research said details on Broadnet’s role in the Government’s Nationwide Fiberisation Plan (NFP) were “still sketchy”, given that the company had no track record in broadband deployment.
The NFP was announced in March last year with the aim of doubling the speed of fixed broad- band and expanding the network reach into rural areas.
“It is not immediately clear if the memorandum of understanding (MoU) between TM and TNB would change anything. Broadnet has both the National Facilities Provider and National Services Provider (NSP) licences, which allow it to bid for broadband infrastructure jobs,” it said in a report.
Nevertheless, the research house does not rule out a collaboration between Broadnet, TM and TNB or other infrastructure providers to lower execution and funding risk.
To recap, on Tuesday, TM and TNB entered into a MoU to work out an implementation plan to deliver on the NFP.
The move is seen as a response to a development that took place weeks ago, in which Broadnet was reportedly appointed by the Government to enter into the broadband space by teaming up with TNB to roll out an extensive broadband network that would capitalise on the latter’s electrical cables reaching homes across the country.
Currently, several players provide broadband services but at a higher pricing compared with other countries.
Broadnet’s objective is said to provide high-speed Internet broadband connectivity to areas that are underserved and unserved currently.
The MoU is subject to a definitive agreement to be signed between the parties upon the finalisation of the commercial terms.
“At this juncture, we are not certain if this involves the earlier reports of a second fixed-broadband network player called Broadnet Network, which could be deployed on TNB’s electricity transmission lines.
“This was reported to be also under the NFP programme,” said AmInvestment Bank Research.
It reckoned that TM’s expertise in rolling out HSBB and now HSBB2 to the suburban and rural areas may expedite the rollout to underserved segments and markets.
“We can envision the collaboration to be complementary by leveraging TM’s already established fibre system to provide connectivity to Broadnet’s future network,” AmInvestment said.