Dtac on intense competition, 4G roadmap, the Internet of things

Norway’s telecom giant Telenor has release its first half year report for 2015, including Thailand and Myanmar reporting.

“Telenor continued to deliver encouraging results for the second quarter. We reported more than NOK 30 billion in revenues and organic revenue growth of 6 per cent. Profitability remained solid, with EBITDA before other items of NOK 10.6 billion and an EBITDA margin of 35 per cent,’’ said departing President and CEO of Telenor Group Jon Fredrik Baksaas.

“In Thailand, competition remained intense in the second quarter. dtac is going through a comprehensive turnaround process, which on the network side has already resulted in a significantly improved network position on both 3G and 4G. The on-going transformation of dtac’s sales and distribution model is key for future success in this competitive market,” said Baksaas.

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“In Myanmar, performance continues to exceed our expectations. In July we passed 10 million subscribers. Customers’ strong demand for voice and data services keeps driving revenues and profitability. During the quarter we further expanded the network, reaching 213 of a total of 330 townships at the end of June. The speed of our network expansion is the key challenge in a nation where approximately 70 per cent of the population lives in rural areas,’’ said Baksaas.

Its operator in Thailand, dtac, has recently announced its 4G roadmap, with a vision to invest in mobile internet infrastructure and deploying a regional clustering model to capture market value nationwide.

dtac envisions mobile internet as the mainstream services of telecommunications in Thailand. With dtac’s ambition to become the leading mobile internet provider in key geographic areas, dtac has deployed the regional clustering model as a strategic transformation journey. The model has been well received with 419,000 new subscribers in the first quarter of 2015, increasing the customer base to 28.4 million.

dtac expects to soon see a major revolution in the Thai telecommunication market, and in the coming years, Thailand must have higher-speed infrastructure ready in order to bring Internet for All and deliver dynamic digital services to new segments. Based on statistics Thailand Social media Landscape, Marketing Oops, Millennials, aged between 18 and 34, are the largest and prime segment of internet users. Photo-uploading is the most popular activity on social media of people in Thailand, with over 495.5 million photos uploaded last year, the highest in the world. 85% of 35 million Thai users watch videos on YouTube and other video streaming services. Currently, dtac customers own 14.9 million smartphones, or equivalent to 52% of its total customers. These are positive factors to the development of the telecommunication industry as well as other industries, such as finance, banking, and entertainment etc.

Lars-Åke Norling, Chief Executive Officer, Total Access Communication PLC (dtac) said, “One of Thailand’s top agenda is to unlock its 4G potential. dtac would like to see a clear and timely spectrum auction roadmap from the government. The coming auction for 900 MHz and 1800 MHz spectrum is the country’s first step in allocating spectrum, which is national resource, as a key enabler of Thailand’s digital economy. dtac looks forward to all available concessionary spectrum (unused 1800MHz, 850MHz, 2600MHz, etc) in any near future auction to ensure high quality 4G services and wide coverage throughout the country. Based on ‘Building Thailand’s Digital Economy and Society 2015’ report from GSMA, there will be 13.8 million 4G subscribers in Thailand by 2019, and mobile broadband penetration will increase from 55% in 2013 to 133% in 2020, lifting cumulative GDP to 730 billion Baht. dtac estimates that there will be over 400 million M2M devices connected across Thailand. In the digital economy, M2M business and Internet of Things will be a key enabler for business innovation, such as fleet management and logistics, as well as for consumer-centric innovation, such as child tracking, senior tracking, and healthcare.”

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dtac has recently realigned its strategy with an objective to improve sales, marketing, and distribution operation efficiency. Five regional business heads (RBHs) have been appointed and act as mini-CEOs for each of the regions.

This organizational change is to further develop the company’s understanding of customers and fulfill their requirements better. The new model also helps dtac strengthen its customer service on a local level and deliver the best experience to our customers, many of whom are not yet connected.

“The five regional business heads are responsible for business objectives for their respective regions, and their teams receive full support from other functions in the company. The cluster-based operating model has been implemented in many Telenor operations across the world. Eight months ago, dtac started its cluster project in order to radically improve the new way it understands and conducts business on a local level. This cluster model also helps strengthen the performance and work culture in dtac,” said the Swedish CEO.

“The cluster-based approach required a new approach to organizational thinking. Five regional business heads (RBHs) have been appointed, while 22 zonal business heads (ZBHs) and 95 cluster business heads (CBHs) are in the process of being appointed. Part of the objective is to create health internal competition among the regions. RBHs report to the dtac CEO and work closely with business partners and retailers. The war room methodology has also been established to, both on a daily and weekly basis, stay on top of the continuous stream of data from the regional zones, which allows the team to address issues quickly and facilitates faster execution across functions”

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