Move likely a strategy to broaden the telco’s customer base and leverage on the UniFi brand

By NG MIN SHEN & RAHIMI YUNUS / Pic By TMR

Webe, the wireless mobile service arm of Telekom Malaysia Bhd (TM), has been integrated with UniFi, TM’s high-speed broadband (HSBB) service, as part of the parent company’s ongoing convergence plan.

In a blog posting last Thursday, webe said starting Sept 16, it would be taking “the next step” in its convergence journey to provide services and products to its customers.

“In the coming days, you’ll notice that the network name at the top corner (either left or right depending on models) of your mobile device — will change from webe to UniFi,” it said, adding that all services and offerings for both webe and UniFi will remain the same.

According to webe’s website, the telecommunications service provider (telco) will not change its name, while the switch in service provider name from “webe” to “UniFi” is a move to further strengthen its aspiration to provide a converged offering.

The company assured users that webe will not be closing down, with its customers remaining under webe, while UniFi will continue to provide fixed-line broadband solutions.

TM last month unveiled “Perfexe 10”, a business strategy to deliver convergence and empower digitisation through different means of execution.

The country’s oldest telco’s initiatives include brand consolidation, liberating WiFi and strengthening mobility, key execution leadership appointments and workforce segmentation to increase manpower productivity.

JF Apex Securities Bhd analyst Lee Cherng Wee said the move to integrate webe under UniFi was likely a strategy to broaden the telco’s customer base and leverage on the UniFi brand.

“I think webe has not reached out to the mass market yet, but with UniFi, the bran- ding would be stronger and

TM might extend webe’s offerings to its current UniFi customers,” Lee told The Malaysian Reserve (TMR) yesterday.

As at end-June 2017, subscribers of UniFi — launched in 2010 — surpassed the one million mark, accounting for almost half of TM’s 2.36 million broadband user base.

“Whether it would translate into a bigger subscription base for webe, that would depend on the marketing,” Lee said.

As per TM’s corporate report dated Sept 11, 2017, webe had a 5.6% household penetration rate versus 4.2% a year ago, with over 2,400 4G LTE (fourth-generation long-term evolution) sites and 66% population coverage nationwide.

The group had previously said it aims to have 8% to 10% of TM households subscribed to at least one webe line by end-2017.

On the possibility of webe’s management being dissolved under the brand consolidation effort, Lee said it was unlikely as the parent company would still require personnel to run its mobile business.

But Lee did not rule out possible changes in the organisational structure and reporting line.

Another sector analyst, who declined to be named, said the change appears to be a rebranding exercise to streamline TM’s offerings under a single brand.

“If webe is not doing well it’s because of their service, not the brand name. So, the impact of the brand change on webe would be neutral,” the analyst told TMR.

UniFi revenue grew 3.3% year-on-year (YoY) to RM1.31 billion in the second quarter ended June 30, 2017 (2Q17), from RM1.27 billion a year ago, according to TM’s report.

However, other revenue — including revenue from webe, property development, TM research and development, TM Info-Media Sdn Bhd, Universiti Telekom Sdn Bhd and Menara Kuala Lumpur Sdn Bhd — fell 9.8% YoY to RM120 million in the 2Q17 from RM133 million previously.