February 3, 2012

4G claims seen as still 'way too early'


The Kingdom’s newest telecom firms have touted fourth-generation wireless services to set themselves apart from the crowded sector, but experts have said Cambodia is not yet ready to adopt the technology.

Both Emaxx and China’s Xinwei Technologies, which received its license from the Ministry of Posts and Telecommunications (MPTC) last August, claim they plan to deliver 4G capabilities to consumers.

And there’s speculation a third company, Alltech Telecom of Russia, which would be Cambodia’s 11th mobile provider, will utilise 4G speeds as well. However, experts have pushed back against the claims, saying most Cambodians could not yet afford the service, and that these companies are not technologically equipped to offer it.

“The business case for LTE [a 4G standard] in an emerging market like Cambodia is difficult, particularly for operations like Emaxx and Alltech who will have to spend heavily to build a nationwide network,” Shiv Putcha, a Melbourne-based telecoms analyst at international research firm Ovum, said in an email.

Emaxx announced in mid 2011 that it would be Cambodia’s first 4G provider. The company, with 40,000 subscribers, is the country’s smallest telecom, according to figures obtained by the Post. The number has remained unchanged since May.

Xinwei also recently claimed to be the vanguard of 4G technology in the country, though neither company has offered a deadline as to when these services would be available.

Analysts and insiders said Russia’s Alltech was issued a license to sell 4G services in Cambodia in December 2010, but the company has yet to make an initial investment. An official at MPTC said yesterday, however, that Alltech had not yet been issued a license.

“Frankly, I think it’s way too early for 4G services in Cambodia … it’s not economically viable or needed today,” Tokyo-based Frost and Sullivan analyst Marc Einstein said yesterday.

The technology is expensive and users would need to buy 4G-compatible phones, he added, a prospect still beyond many Cambodians.

Emaxx chief operations officer Frank May said yesterday via email that the company was carrying out network upgrades, and the service “will go online soon”. He maintained that the demand for data will drive the 4G market in Cambodia.

CMDA technologies were “core for the move to [4G]”, he said, and “lower cost for [an] operator to use”.

“Many of the current 2G-3G operators will have to upgrade to keep pace with the market,” May said.

The promise of 4G in Cambodia may be nothing more than a “marketing ploy”, Frost & Sullivan’s Einstein said. Other telecoms in the region have advertised 4G on networks, such as WiMAX, which simply don’t support the technology, he said.

Emaxx’s CDMA technology has similar problems, according to Einstein. Standard 4G cannot be provided on CDMA or GSM, which is a standard for 3G networks, he said.

MPTC issued Xinwei a license for Chinese-developed TD-SCDMA, the Post reported in January. Despite Xinwei’s 4G claim, analysts say the Chinese technology it not capable of offering the service.

“TD-SCDMA does not come close to 4G-like speeds,” Ovum’s principal analyst Daryl Schoolar said via email, adding that Chinese reports on the technology were negative.

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