Instacom sees Sarawak adding to future income stream

KUCHING: Soon-to-be relisted Instacom Group Bhd (Instacom) sees Sarawak as one of its future potential revenue generators given that the market is still lacking in advanced telecommunications infrastructure.

“There is still a lot to be done here (East Malaysia) if compared with what has been done in West Malaysia. New technology has evolved to provide solutions where the cost of traditional infrastructure is much more expensive than what we have now,” Instacom chief executive officer Anne Kung told The Borneo Post recently.

“The government needs to recognise that telecommunication infrastructure is no longer a luxury but it is a necessity,” she stressed.

Going forward, Instacom is currently working on new solutions to overcome the need of electricity to power telecommunication stations in rural areas. “We are actively looking into green technology such as wind turbine power and solar power to see if the energy generated is sufficient to ‘start’ the project or not,” said Kung.

Kung further pointed out that one of the biggest challenges in Sarawak was to get to a destination whereby the only mode of transportation was by boat. However, Instacom had successfully carried out several projects along the path.

On the other hand, she also said that Sarawak should get its biggest share under the Malaysian Communications and Multimedia Commission (MCMC) Universal Service Provision (USP) fund.

The USP fund is aimed at providing telecoms facilities and Internet access to under-served areas, which are essentially areas where telecommunication operators have not ventured into due to insufficient demand.

“The beauty of infrastructure in telecommunication is that it does not require even a penny from the government. All this is industry driven by the private sector,” she said.

Under the USP-funded projects, Instacom had successfully built 17 towers in Sabah state in a record of six months time. “Some of these locations are as challenging as it is in Sarawak, whereby we have to transport our equipment by boats.

“We believe West Malaysian industry players will face tremendous challenges if they happen to come over here principally because they do not understand the cost of logistics to be able to transport and build infrastructure,” she stated.

Instacom further strengthens its income stream through portfolio expansion of ‘turnkey build and finance’, where it procures financing for the capital expenditure and customers assign the rental proceeds from the sites to Instacom over a period of time.

Addressing the new structure design, she pointed out that Instacom had been doing ‘in-building’ infrastructure as well as fibre optic work for universities and also currently doing it (in-building infrastructure) for Plaza Merdeka.

“We took the model of the tower and proposed it to the telco, so they need not worry about the capital expenditure. We will build it and we will collect rental fees from them,” Kung explained.

Leveraging on the nationwide presence in both East and West Malaysia, Instacom Group would have competitive advantages in bidding for the major projects that were expected to be constructed over the next five to 10 years.

The group is scheduled for relisting on the ACE Market on Bursa Malaysia on October 8, 2012.