MIDF Research views telecommunication service provider Maxis Bhd's (6012)pact with Telekom Malaysia Bhd for the HSBB (high speed broadband) access services as positive.
The pact will enable the company to offer bundled services integrating IP-based offering to more than 700,000 homes and 1.3 million homes by end of 2012.The research house, however, believes the impact on Maxis will not be immediate, given that the HSBB rollout is yet to reach full swing.
Also, there are no details on the service offering by Maxis, implying there are constraints to determine its attractiveness compared to TM's UniFi.
"As we understand it, Maxis would only have the last-mile connection to the HSBB, the peripheral network that is the most tedious and expensive part of connectivity, and uses its own trunk fibre optic network for the transmission of the network - i.e backbone connection," the research firm said.
MIDF Research expects potential impact to Maxis' top and bottom line in financial year 2012. For financial year 2011, it expects the company will see a growth of up to 4 per cent.
"We have not imputed any incremental earnings coming in from this new potential for FY11. We predict the service could only have potential earnings accretion in FY12. In the short-term, Maxis may face a slight pressure on costs, as the offering of high-speed broadband under the agreement necessitates Maxis to have its own value-added service on top of the service already provided by Unifi currently," it explained.
The research house said it was not surprised with Maxis' decision to venture into the home sphere given that the mobile communication space is saturated, sitting at over 106 per cent.
Maxis is the leading service provider garnering about 40 per cent of the market total subscription.
MIDF Research said with the introduction of YES by YTL Communication, competition will intensify in the mobile Internet space.
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