No plans to exit DiGi: Telenor

On rumours that Telenor is looking to sell down its stake in DiGi, Brekke said Telenor is a long-term investor and there are no plans to exit DiGi.


“Since our entry into DiGi, it has continued to perform well and has grown in its market position. We are happy with how DiGi continues to operate. Moving forward, DiGi is well-positioned to take part in the growing demand for data and we want to be there,” he said.


DiGi rose to a recent high of RM32 on Sept 9 and ended lower at RM29.38 yesterday.


The allocation of 20MHz to the nine players was received with much criticism as the capacity is too small to provide satisfactory services to customers.
There is also the question of new players such as Puncak Semangat which does not own any network infrastructure or has any experience running a telco business.


The companies submitted their business plans to MCMC last year and were asked to re-submit in June as the regulators wanted more clarification on their proposals for the spectrum.


Market talk has surfaced that results of the allocation are expected to be announced at the end of this month. However, market observers said the allocation of 20MHz per company is insufficient to provide meaningful services to customers. It is said that at least a capacity of 40MHz is required to provide good LTE services.


DiGi CEO Henrik Clausen said the group has submitted its plan and that it could leverage on Telenor’s experience in rolling out LTE services.


“We have updated MCMC with our business plans and hope the process would be concluded soon. We have a network that has the ability to roll out LTE and we would be able to learn from Telenor’s LTE implementation in the Scandinavian countries to build a strong network and offer competitive pricing,” he said.


Apart from Malaysia, Telenor also has presence in the Nordic region, Pakistan, Bangladesh, Thailand and India. Telenor launched 4G in Sweden last November and  expects to roll out the services in Norway and Denmark by early 2012.


Clausen noted that demand for data services is the next growth engine for DiGi and the telco industry and as such, the right allocation of spectrum is essential to maximise benefits for the masses.


Currently, only 14% of the 9.3 million DiGi subscribers are Internet users, but the number is expected to grow exponentially when 4G services are available to the public.


Clausen said the network collaboration with Axiata is going well with the initial phase of 200 consolidation sites in Perak nearing completion.


“We are close to completing the consolidation and renegotiation of 200 sites in the initial phase. We are now deciding on the next batch and we hope to complete the consolidation of all 2,000 sites in two to three years,” he said.


He added that the collaboration is expected to achieve a combined savings of RM2.2 billion over the next few years for DiGi and Axiata.


 


 

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