Business

Friday August 14, 2009

A new mobile phone service to be launched

By B.K. SIDHU


PETALING JAYA: Tune Talk Sdn Bhd, in which Celcom (M) Bhd has a 35% equity stake, is finally set to launch a new prepaid mobile service next Wednesday after over a year’s delay.

The move could potentially spark a new round of price war in the prepaid segment of the cellular market.

Celcom has an option to raise its stake in Tune Talk to 51% within three years or when Tune Talk’s subscriber base reaches 1.5 million, whichever is sooner.

Jason Lo ... ‘We are offering voice, SMS and data services on a 2.5G platform’

Tune Talk is a mobile virtual network operator (MVNO) that rides on Celcom’s cellular infrastructure to roll out services as it does not have its own spectrum, but has operations in billings, customer care and switching systems.

“We are offering voice, SMS and data services on a 2.5G platform. A user just needs to buy a SIM card for RM5 and insert it into his mobile phone, choose the number he wants and he is connected to our network,” Tune Talk chief executive officer Jason Lo told StarBiz in an interview yesterday. “We are going to offer very low flat rates for our Tune Talk service and we offer nationwide coverage from day one.’’

Tune Talk’s prefix for its cellular service is 010.

Apart from Celcom, Tune Ventures (owned by Datuk Seri Tony Fernandes and Datuk Kamarudin Meranun) has a 37.5% stake in Tune Talk.

The remaining 27.5% in Tune Talk is held by several individuals including Datuk Seri Kalimullah Masheerul Hassan, Lim Kian Onn, Lo, Gurtaj Singh (the COO of Tune Talk) and Mark Lankaster (the CEO of Tune Hotels).

The company has a paid-up capital of RM10mil.

Lo expects the capital expenditure over the next three to five years to be between RM40mil and RM50mil, of which RM10mil will be invested in the first year.

Tune Talk is not the first to launch a service on the MVNO concept as U-Mobile, Merchantrade, XOX.An and RedTone International Bhd have all done it, but it claims to have the widest coverage.

Even so, it will have to battle it out with major players such as Maxis Communications Bhd, DiGi.Com Bhd and even Celcom which have their own networks and established subscriber bases in both the postpaid and prepaid markets where the pricing is already very competitive.

Together, these three companies control nearly 100% of the cellular market share in the country.

“We know the other players have the financial muscle but let’s see how the story develops. We are going for the under-served market, the basic users and we want to be part of the cellular industry. Celcom is very supportive of what we are doing (even though we are competitors in the market place),’’ Lo said.

What Tune Talk is about to offer may stir up competition, with entry level SIM cards reasonably priced at RM5 each, competitive rates and plans to give out 10 e-vouchers daily for a year which will cost the company RM1mil.

“Our product offering is going to be unique as every day we will be giving out 10 e-vouchers to the highest voice users. These vouchers are valued at RM200 each and can be redeemed for air tickets from AirAsia. We will also provide personal accident coverage to all our users and this is provided by our partner, Etiqa Insurance.

“I have been a user of a particular mobile company but I have not got bonus in airtime or even a free phone even though I believe I should. It really depends on where you put your customer and at Tune Talk we are putting them first,’’ Lo said, adding that the target in the first year was to get one million customers.

Tune Talk will distribute its products via 10,000 dealers in the country.


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