LOWER ROAMING RATES BETWEEN MALAYSIA AND SINGAPORE MAY TAKE LONGER TO IMPLEMENT

KUALA LUMPUR, Jan 17 (Bernama) -- Following reports that mobile operators have
agreed to lower roaming rates between Malaysia and Singapore in two months, OSK
Research had elicited inconsistent responses from the telcos in both countries.

"While the mobile operators have agreed in principal to lower rates, we gather
that there would be further delays in the finalisation of individual roaming
agreements, pending directives from the respective telecom regulators," OSK
Research said, in a research note Monday.

It also maintained a "neutral" stance on the telecommunications sector.

Based on its random checks, it had elicited inconsistent responses, in
particular the statements by the Ministers on the timeline for implementation.

"A key reason cited for the long delay in wrapping up the proposal, is that,
each individual operator has to enter into separate agreements with their
roaming partners with extended discussions on rates and conditions to be
established," it explained.

According to the research house, the proposal for lower roaming rates between
both countries was mooted as far back as 2007, with a formal proposal tabled in
June 2010.

At the recently concluded Asean Telecommunications and Information
Technology Ministers Meeting, the Minister of Information, Communications and
Culture, Dr Rais Yatim and Singapore's Minister of Information, Communications and
Arts, Lui Tuck Yew had jointly announced, that both countries would be unveiling
lower roaming rates in two months.

OSK Research said Singaporean telcos may have more to lose as the proportion of
roaming revenue, as a percentage of overall mobile revenue, differs across the
telcos in Malaysia and Singapore.

"Singapore telcos like Singtel, StarHub and M1 are likely to be more affected by
the move, as they have a higher proportion of roaming revenue and have more
roamers on their networks both inbound and outbound," it added.

It said a reciprocal 30 per cent reduction in roaming tariffs between the two
countries, and assuming a third of the overall roaming revenues of the telcos
are derived from travelers in both, it would impact Singapore mobile revenues by
0.9 per cent to 2.1 per cent.

This is compared with an estimated 0.7 per cent to 0.9 per cent for
Malaysian telcos, all else being equal.

However, OSK Research said the downside on revenues, is mitigated by the telcos
who actively share and swap minutes with each other.

The lower roaming rates between both countries may be used as a template for
other Asean member countries to emulate under the Asean ICT Masterplan.

"The proposal is perhaps similar to that adopted by the European Union in which,
lower roaming tariffs, were introduced in June 2007 for the 27 member countries
following a directive by the European Commission.

"Given the different regulatory setting and challenges faced by the Malaysia and
Singapore telcos, we think an Asean collaboration would be a tall order," it
said.
-- BERNAMA