Downturn Not Slowing Wireless Broadband Growth

The sluggish economic environment won't drag down growing demand for wireless broadband services in Southeast Asia, according to the chief executive of Malaysian WiMax operator Packet One Networks.

"Broadband is no longer a luxury, it's a necessity; and it's no longer a privilege, it's a right," said Michael Lai, CEO of Packet One, speaking during a panel discussion at the CommunicAsia exhibition in Singapore.

WiMax is a wireless broadband technology that offers greater range and throughput than Wi-Fi networks, allowing operators to make high-speed Internet access available over a wider area. The technology is seen as a way to quickly expand broadband access in emerging markets and bring new players into telecommunications market.

Packet One began offering WiMax services in Malaysia last year, giving subscribers fixed-wireless broadband access in their homes. The operator's coverage remains limited even in Kuala Lumpur, where the service was first rolled out. But the company continues to expand its reach, adding coverage in more cities and filling in gaps where its network doesn't yet reach.

"We always believe the best time to invest is when [the economy] is down," Lai said.

Broadband Internet penetration in Malaysia -- 21.1 percent of households at the end of 2008 -- lags other Asian countries, such as Singapore and South Korea. But the Malaysian government wants to see that figure increase to 50 percent by the end of 2010.

Whether WiMax plays an important role in extending the reach of broadband Internet services remains to be seen.

WiMax will have to compete for wireless broadband market share with Malaysian cellular operators, offering Internet access over their 3G networks, market research firm IDC said in a report issued earlier this month. WiMax is hampered by limited coverage in Malaysia and established cellular operators will move aggressively to defend their market position from new entrants, it said.

"The introduction of WiMax services has also received a lukewarm response from the public," the report said, estimating that PacketOne had 10,000 subscribers at the end of February 2009.

Packet One has said it expects to have more 200,000 subscribers by the end of this year.

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