Anticipating Demand for broadband
Yeoh Tien Kiang
The Sun-10/07/00
BROADBAND is another industry buzzword that every body talks about but very few actually understand. All that we know is that broadband is hot and its something already available in the US, in Singapore and in other parts of the wired world but is not yet quite happening in Malaysia.
Strictly speaking, broadband refers to a form of data transmission in which several parallel channels pass across a single wire.
These days, though, it refers to any form of high-speed data access whether it’s through a cable modem, DSL (digital subscriber line), fibre-optics, satellite or (perhaps someday) high-speed wireless service.
In English, it refers to speedy Internet access.
Cordoda, a soon-to-be-launched local start up, provides broadband services across peninsula Malaysia and to Sabah and Sarawak.
Services
Actually, Cordoda does more than just provide broadband for data and Internet access. It also has a "server farm" where it takes care of other companies’ servers. Its core business, however, is in providing broadband. Cordoda is able to provide connections of line speeds ranging from 64kbps to 34Mbps (super fast!). To give you a yard stick, a typical Jaring or TMNet dial up service gives you at most 40kbps even when you use a 56Kbs modem.
Cordoda doesn’t lay its own cables but instead leases them from several existing local telcos. What it does do is provide value-added services to the broadband access. These include:
> Security: its virtual private network for connecting customers protects against any unauthorized intrusion by a third party.
> Reliability: a guaranteed network availability of 99.97% with monitoring and management 24 hours per day, seven days per week, 365 days per year.
> Flexible billing structures: clients are billed based on actual bandwidth used.
Key Success Factors
A major success factor to consider: is there a big enough market for broadband in Malaysia? The business of providing big fat pipelines to transfer information has been around for quite some time. There are several reasons why those caller endeavors failed. Most probably it was due to low demand and high costs - a lethal combination.
There is no question that there is a growing industrial demand for high bandwidth for transferring bulky data. But, is year 2000 the right time to introduce such a service? Or is 2001 2003 or 2005 the right time? Nobody knows for sure.
The ability to identify the market sectors that would use its services is another critical element to the viability of
this business model. Cordoda has identified that the financial services industry, insurance companies and manufacturers (especially multinational corporations) are their prime targets.
Another important factor is the determination of acceptable pricing. It could go for the masses and adopt a low-cost strategy for that or adopt a premium, niche marketing strategy instead.
It’s also crucial that Cordoda is able to differentiate itself from the others. We counted that there are at least four others in the local market who are doing more or less the same thing. Perhaps one way to differentiate itself is by identifying the value added services that its target customers may want or require. Such services may become the main differentiation between one service provider and another. It is certainly what is differentiating Cordoda from the telcos that it leases the lines from.
Suppliers and Competitors
As this business is layered on top of pipelines owned by existing local telcos, it is crucial to strike a friendly, long-term relationship with them.
This relationship could be a tricky one because the telcos are Cordoda’s suppliers and yet its competitors at the same time. Based on developments worldwide, the possibility of telcos banding together to wipe ant a competitor is very real.
Impact of this business model
As this business model (broadband service provider with value-added services) is relatively new worldwide, it is worth watching its development especially in terms of customers adoption rate. It will also be interesting to see which new services will appear once high bandwidth becomes common place. We foresee that companies will continue to increase their expectations in terms of data, rich content and active multi-media.
Company: Cordoda Corporation
Services: Broadband data access; broadband Internet access server farm
Key Success Factors:
> Is there a big enough demand for broadband in Malaysia?
> What is your target market?
> What price is suitable?
> What value-added services will you provide?
Danger: Existing telcos might team up to defeat you
Impact: Once broadband becomes commonplace, many new services will emerge.
This
news is related to Cordoda Corporation Sdn Bhd
Search
for more news relating to Cordoda Corporation Sdn Bhd
Search
for products & services relating to Cordoda Corporation Sdn Bhd
