Often, players in respective industries need to innovate in this aspect to stay relevant and competitive by today’s standards.
BizHive Weekly explores the many advancements made in digital technology in Malaysia and highlights certain players in niche industries paving a name thanks to unique technology.
The drive for digital technology
One cannot deny the importance of technology in fuelling the growth of the world today.
Transcending levels – from personal use to professional means – technology connects us all.
One cannot progress without embracing technology and the changes that come along with it.
Simply put, technology is the application of knowledge to invent practical tools or to solve problems.
The pace of change for technology is quick and abrupt.
Machines are often made obsolete quickly, requiring entities to upgrade themselves to change assets in order to survive in this modern world.
Technology is already a major contributor to Malaysia’s economy, lumped together under the information and communication technology (ICT) sector as one of its largest components to date.
Currently, the industry represents around 10 per cent of gross domestic product (GDP), a figure the government was keen to increase as it pushed to achieve a developed nation status by the year 2020.
Breakthroughs made in technology have been applied in many ways to industry and commerce.
Several developments of these breakthroughs ultimately filtered down to provide benefits for the regular person.
With the passage of time, businesses worldwide embrace technology, following the patterns of change.
For example, corporations build their presence on the Internet via websites and personal domains.
With the birth of social media sites like Facebook and Twitter, businesses, too, take to the creation of profiles to adapt to the changing marketing and customer relationship management industry.
Thus, it can be observe how crucial technology is to the working world, helping enterprises both internationally and locally to advance forward.
According to the Multimedia Development Corporation (MDeC) earlier in July, the outlook for that industry should remain positive for the rest of the year, driven by strong domestic demand and higher consumer spending.
This prognosis was supported by a recent forecast by the National ICT Association of Malaysia, which predicted growth of eight to 10 per cent for the sector in 2012.
Developing a cohesive digital ecosystem One major advancement introduced by the government in this sector is ‘Digital Malaysia’, one of the country’s iconic flagship projects that aim to make the ICT sector one of the key pillars of its economy.
Initiated by the Prime Minister, Datuk Seri Najib Razak last October, Digital Malaysia, under the watchful eye of MDeC, will ramp up the contribution of high-value, knowledge-driven digital initiatives to 17 per cent or over RM294 billion of the gross national income (GNI) by 2020 from 12.5 per cent currently.
MDeC’s role is to transform the economy to a digital economy with emphasis on innovation, creativity and productivity.
Digital Malaysia has set a target of RM75 billion in GNI contribution from the digital transformation initiatives by 2020.
Together with the RM93 billion from the existing Information and Communications Technology (ICT) initiatives and RM126 billion expected from ICT initiatives in the Economic Transformation Programme (ETP) and Government Transformation Programme (GTP), it will bring the GNI contribution from Digital Malaysia to RM294 billion by 2020, Najib said.
According to Najib, the digital transformation initiatives would enable Malaysia to raise the ICT contribution to GNI to 17 per cent by 2020 from 9.8 per cent currently.
It would also enable Malaysia to be in the top 20 in the digital economy ranking by 2020, from its current 36th spot out of 70 countries, and also in the top 10 in the IMD World Competitiveness Scoreboard, from its current rank of 16 out of 59 nations.
Bridging the digital divide Among the initiatives under the digital transformation programme are ensuring an eco-system and culture to allow entrepreneuring skills and spirit to flourish and converting start-up companies to e-commerce and online businesses.
Other initiatives include injecting greater creativity and promotion of thinking skills throughout the education system, commercialising in stages 300 intellectual property opportunities developed by universities, and encouraging venture capital to promote the creative industry.
To date, eight of the Digital Malaysia projects have already been approved and will be rolled out in stages.
That plan was given a boost in early July this year, when one of the government’s lead agencies in its drive to develop the sector unveiled the first major projects in the Digital Malaysia programme.
The investments will be used to create 160,000 jobs, besides providing an additional US$2,300 in annual income for 350,000 citizens via digital income by 2020.
These thrusts include initiating more demand-focused activities to leverage on the supply, encouraging internet users to come up with products or services while they consume from digital technologies, and increasing the development of local talent in key industries.
Innovation remains key One of the key focuses of technological advancement is innovation, as recently advocated by SME Corporation Malaysia (SME Corp) chief executive officer, Datuk Hafsah Hashim.
“A major area of competitiveness that needs to be explored and tapped by Malaysian businesses is innovation,” she highlighted.
“Through innovation, we can produce products or services which are unique and outstanding, serve a niche market previously untapped, or even introduce a completely new segment to the market.
“These could all translate into tremendous market potential that could eventually result in a leapfrog growth, spurred by high value added activities.” Hasfah affirmed that a country’s economic value chain could be moved up to a higher level through innovation.
“Innovative approaches and methodologies will enable the generation of fresh new ideas, which can be turned into commercially viable products and services.
“Innovation is not limited to mere business operations, as practical and adaptable innovative business models and solutions need to be adopted and practised as well.” As such, BizHive Weekly takes a look at the companies in the ACE Market-listed companies REDtone International Bhd and Asia Media Group Bhd, as well as their endeavours to promote themselves as the technology companies of distinction.
Asia Media reaching new heights with advertising technology
Technology is continuously changing how humans live and work, pushing the limits of what humans thought possible and increasing the rate and pace of innovation in every industry.
Technology also has affected humanity and its surroundings in various ways.
In numerous societies, technology has helped expanding more advanced global economy.
Various implementations of technology also influence the society.
Asia Media Group Bhd (Asia Media) is Malaysia’s leading digital out-of-home Transit television (TV) company.
It is the only digital out of home player in Malaysia with a full-fl edged Content Applications Services Providers Individual License, Network Facility Provider Individual Licence, Network Service Provider Individual Licence and Application Service Provider Class Licence awarded by Malaysian Communications and Multimedia Commission (MCMC).
According to Dato’ Ricky Wong, the chief executive officer of Asia Media in an exclusive interview with the BizHive Weekly, “With these licences, Asia Media is able to operate a nationwide 24-hour non-subscription broadcasting (similar to free-to-air broadcasting), subscription broadcasting and terrestrial radio broadcasting.”
Asia Media is a media provider, offering high-quality infotainment and targeted advertising through the use of digital electronic displays installed in various outdoor premises.
Recognised as the ‘Largest Transit-TV Network’ in Malaysia, as awarded by The Malaysia Book of Records, Asia Media has 3,993 liquid crystal display (LCD) screens installed in 1,800 buses travelling in the market centric hubs of Klang Valley and Johor Bahru.
Asia Media operates using a technology called Terrestrial- Digital Multimedia Broadcasting (T-DMB).
T-DMB is a digital radio transmission technology for sending multimedia such as TV, radio and datacasting to mobile devices such as mobile phones.
This technology is also known as mobile TV.
It can operate via satellite Satellite- Digital Multimedia Broadcasting (S-DMB) or T-DMB transmission.
DMB has also some similarities to the main competing mobile TV standard, Digital Video Broadcasting – Handheld (DVB-H).
Digital Television Terrestrial Broadcasting (DTTB) is a new type of broadcasting technology that will globally transform television as we now know it.
DTTB refers to the complete digitisation of the TV signal from transmission to reception.
“By transmitting TV pictures and sounds as data bits and compressing them, a digital broadcaster can carry more information than is currently possible with analogue broadcast technology.
“This will allow for the transmission of pictures with high-definition television (HDTV) resolution for dramatically better picture and sound quality than is currently available or of several standard definition television (SDTV) programmes concurrently.
The DTTB technology can also provide high-speed data transmission, including fast Internet access,” explained Wong.
Asia Media business objective is built on a simple premise – to make mainstream advertising affordable to many by levelling the playing field for advertisers with less spending power.
According to Wong, “We achieved this by building a new media platform in Malaysia which bypasses the traditional media format (print, radio, TV) and subsequently creating the demand for it.
Challenges ahead “One of the main challenges we had was to educate and convince advertisers that Transit-TV as a medium, is more effective for reaching out to consumers.
At the same time, this can be achieved with a fraction of the cost of traditional advertising mediums,” he explained.
When asked how grasping of the T-DMB technology network help the company increased the product offerings to the industry or other industry, he said that the technology helped the company expand its coverage and the penetration rate of its Transit-TV network systems.
“Furthermore, it also helps the group to strengthen its market position, in a sense that would create barriers of entry for current and prospective competitors.
“Secondly, the T-DMB technology helped the group increase their coverage.
“Our current partners are RapidKL, Causeway Link, Plusliner and nice bus operators.
“Looking forward, the group aims to increase its coverage to other public transportation systems such as KL Monorail, LRT, and KTM komuter,” said Wong.
In addition, the technology can also maximise its average revenue per hour.
He explained that the group could offer more programmes with embedded advertising such as infomercials, thus increase programme sponsorship and increase the average revenue per hour.
Going forward, when asked regarding its investment, Asia Media had invested a total of RM50 million for its Klang Valley rollout for its Digital Live Transit-TV Broadcasting.
He added that, “The other major states within Peninsular Malaysia will be rolled out in stages from 2012 onwards.” When asked regarding the future of the company’s technology for the next five to 10 years, he opined that, “The group wants to the Out-Of-Home into Asia Media TV and roll it out in the Klang Valley upon completion of the construction of the transmitter and transmission towers which is expected by the end of 2012.
“We want to deliver real-time advertising with the -time contents.
Advertising will be a lot more targeted,” Wong added.
Moving on, when asked about his thoughts for this year in terms of development and changes brought upon by external factors, he said that the advertising expenditure (adex) would elevate.
“In terms of external facts, as the country economy regains momentum, we will expect ADEX to pick up.
As digital out-of-home (DOOH) advertising is getting a larger slice of advertising budget, we expect our revenue to grow in line with our forecasts,” he explained.
According to the research team at the TA Securities Holdings Bhd (TA Securities), DOOH media advertising expenditure (adex) compound annual growth rate (CAGR) grew by 75 per cent between 2007 to 2010.
It was significantly higher than that of Out-of-Home segment of 14 per cent and the total industry adex of just 12 per cent.
“The strong growth, which is mainly due to the growing stage of the DOOH media industry, is a great opportunity for Asia Media to tap into especially given its stronghold position in the DOOH market with a 74 per cent market share,” said the research firm.
As for internal factors, Wong opined that, “It is worth noting that investing in and incubating early-stage technology is not our subject.
Strategically positioning ourselves and profiting from the probable futures of television, media and entertainment resulting from technological transition is our goal.” In terms of technology trends, he said that it was important.
“Having said that, it is the application of the technology is the key.
“Disruptive technologies and disruptive mediums such as Transit- TV will change the way our clients and advertisers approach their strategy.
“Furthermore, technology is also being used to shape consumer spending habits.
“We have integrated our transit- tv with online web 2.0 tools to offer our viewers and clients an unrivalled service,” explained Wong.
In terms of the Asean region, Malaysia is definitely one of the leaders when it comes to technology.
However, to be a true global player, he said the group needed the support and vision from the government.
“A lot of nations have already transitioned from analogue to digital transmission, with the UK for example having shut off analogue transmission completely.
“This transition is inevitable and Malaysia is only beginning to explore such option.
“We look forward to assisting the Malaysian government make this transition,” said Wong.
Asia Media have more to benefit from the government’s initiative to increase the usage of public transport by 20 to 30 per cent yearly, targeting 30 per cent of public transportation users by 2015.
REDtone embarks on plan to connect the nation
Lau Bik Soon, REDtone chief executive officer
Since its commencement of business over a decade ago, REDtone International Bhd (REDtone) has expanded and evolved from a simple voice service provider into a full-fledged international telecommunications company.
In the present day, the REDtone brand has an outstanding reputation that was built on the fundamentals of customisation, service, value, reliability and quality.
Lau Bik Soon, REDtone chief executive officer said that, “REDtone started as a discounted service provider.
We pioneered discounted calls in the country.
Voice has been our core business for more than a decade.
“Furthermore, it also continues to generate returns for the company, although on a thinner profit margin,” he said.
History in the making
Following a business transformation in 2009, REDtone expanded into data business which has been growing rapidly.
According to Lau, the potential in data was great and the company would be focussing on strengthening the data business.
REDtone is well-known for its research and development (R&D) capabilities which it has been building on since 1996 when its founding company, REDtone Telecommunications Sdn Bhd, initiated its operations.
Its R&D efforts were given a boost when it became the first Multimedia Super Corridor (MSC)-Status Company in Malaysia to be awarded a RM3.2 million grant under the Multimedia Super Corridor Research & Development Grant Scheme (MGS) in 1998.
It received an additional grant of RM3.5 million few years later in 2001.
With more than a decade of experience working with businesses, consumer as well as government agencies, the company has the expertise, technologies and skills which are necessary to deliver the best solutions.
Spurred by this achievement, REDtone is constantly introducing innovative new products and services to keep pace with market trend.
In addition, the company was listed on the Malaysian Exchange of Securities Dealing & Automated Quotation, now known as ACE Market, in January 2004.
REDtone’s solid efforts in design, development and research of new products have yielded technological innovations which have won a series of awards in Malaysia, as well as abroad.
“These innovations had not only served the company’s business interest but have also succeeded in benefited clients and the industry as well as setting the industry standards,” said Lau.
Considered as one of REDtone’s strong point, its R&D expertise sets the company apart its peers in the industry and provided a unique competitive edge.
At the end 2006, the company had invested more than RM25 million in R&D.
One of the unique features by REDtone is the REDtone ODC, or known as the Optimised Discounted Call.
Its uniqueness lies in the REDtone integrated network, an end-to-end total solution with Voice & Data capability.
ODC features the advanced REDtone SIPhony Voice over Internet Protocol (VoIP) technology which allows customers to make calls via Digital Subscriber Line (DSL) or any internet connection.
Its intelligence routing system ensures that clients will always get great value for money.
It provides superior voice quality, reliability and big savings that will meet and exceed all clients’ requirements.
Additionally, with a sound reputation of successful rollouts of a range of services in Malaysia, REDtone has extended its market reach beyond Malaysia by replicating its proven telecommunications service business model in China.
Lau further elaborated that, “REDtone has been in China for five years.
“Our operations in China which is REDtone Asia Inc, is listed in National Association of Securities Dealers Automated Quotation (Nasdaq) and is growing and healthy.
“In Shanghai, where we are currently operating, we have our voice business with about two million clients.”
Unique collaboration
When asked regarding the current Malaysian market in sustaining the increased competition, Lau opined that, “I think we can look forward to see companies collaborating with one another, as collaboration will help in bringing down the total cost of deployment.”
Recap that REDtone and Maxis Bhd (Maxis) entered into a spectrum and infrastructure sharing agreement last July that would enable both company to fast track their roll out of ultra-high speed fourth generation (4G) networks throughout the country.
This would mean that clients would have the opportunity to access the highest 4G broadband speeds in the country with up to 150 megabits per second (Mbps), with the latest 4G long term evolution (LTE) technology through the combined spectrum.
The infrastructure involvement partnership between REDtone and Maxis responded to the government’s call for telecommunication providers to reduce duplication of network assets, enabling telecommunication operators to carry out better services.
REDtone and Maxis partnership would also speed up the broadband penetration in the country, paving the way in the direction of achieving the nation’s National Broadband Initiative ambitions, in which it would further enhancing the country’s digital lifestyles and the content industry.
Infrastructure-sharing also helps to reduce capital expenditure (capex) outflow from the country and maximises usage of spectrum, a scarce and precious resource.
“We foresee that about four or five infrastructure sharing partnerships to be formed resulting in more packages being made available to clients,” said Lau.
He further added that any infrastructure sharing would definitely benefit the end users.
“This is because, it makes more sense for us to work and collaborate together with other telecommunications players to share infra and spectrum.
“This collaboration will provide us with nationwide coverage in the shortest time possible,” he explained.
In terms of execution of plans, Lau said that there are some challenges that the company might face.
Furthermore, he mentioned, that to roll out nationwide coverage, there were many steps involved, ranging from site acquisition to network planning, as well as deployment.
“There are bound to be challenges, but since we are looking to collaborate with other teleco players, we believe that the challenges that I mentioned earlier could be minimised to a manageable level,” concluded Lau.
Moving forward, REDtone will continue to solidify its data business such as the corporate Internet services, managed network, management and building of Wireless Fidelity (WiFi) networks, as well as the subsequently mobile data upon the roll out of its 4G LTE network.
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Autor(en)/Author(s): Alan Dexter
Quelle/Source: The Borneo Post, 19.08.2012
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