TrueOnline Business Briefing
advertisement
Business Briefing July 5, 2010 at True Tower Agenda TrueOnline Overview Broadband Business Business data service International Gateway Fixed‐line Fixed line Business TrueOnline Strategy gy Overview TrueOnline: True Online: Business Structure TrueOnline service revenue Bt mn • Fixed‐line telephone • Public phone • WE PCT 26,387 3,855 5,866 7,426 9,220 9,944 10,397 Broadband & data services 11,453 10,179 8,564 2008 2009 2007 Traditional voice 25,989 New businesses, businesses convergence & others 24,528 Broadband & Data services • Dial‐up Internet • Broadband • Business Data services Traditional voice services Convergence & others • Convergence • TrueMoney • Internet & data gateway • Others (Online games, VoIP, etc.) TrueOnline: True Online: Profitability & CAPEX trend EBITDA & EBITDA margin 38.8% 38 1% 38.1% 36 4% 36.4% CAPEX Bt mn Bt mn 9,670 10,195 , 9,804 1,849 2007 2008 2009 2007 EBITDA 2,408 2,551 2008 2009 EBITDA margin EBITDA margin to stabilize after business transitioning to high growth, lower margin businesses Annual CAPEX plan for 2010 Online O li Group: G Bt3 5b Bt3.5bn Broadband: Bt2.5bn in new technology roll-out and network expansion Focus shift to BMA outskirt and high potential provinces Strong growth potential for Broadband Broadband subscribers by continent 2009 Fixed‐line Broadband Penetration 2,297 1,766 million subscribers 801 39 131 215 58 40 131 107 226 1,366 34 26 95 72 188 1,050 18 68 51 158 289 98.0% 94.0% 94 61 175 154 280 81.0% 79.0% 41.0% 14.5% 11.1% 10.7% 518 442 367 348 450 583 2009 2010 2011 762 2012 Africa Middle‐East Eastern Europe North America Western Europe Asia‐Pacific Asia Pacific 1,014 2013 Source: True Corp & Point Topic, March 2010 Thailand Broadband penetration forecast Latin America 27.2 21.5 Source: OVUM, Booz & Company analysis, Feb 2010 30% Growth From y year 2010 “Asia Pacific Growth ~33%, Higher than others ” 10.6 0.5 13.4 17.0 4.9 3.0 0.1 0.6 1.0 2006 2007 2008 2.2 3.8 6.4 2009 2010E 2011E 2012E 2013E Subscribers Source: Company 2.9 49 4.9 Penetration rate (%) Competitive advantage with superior network CSN True PSTN Network in Optic Fiber TN Bangkok Metropolitan Area (BMA) RCU RCU RCU RCU (OSP ‐ Copper) Fiber and advanced electronics = greater reliability and stability Shorter “last mile” connection improves Broadband performance – avg. within 3km Costly and difficult to replicate Fiber rich (>240,000 core Km in BMA; >300 000 nation‐wide) >300,000 nation wide) 780++ RCUs (instead of 70‐80 central offices) Broadband Broadband: Revenue growth in double digits TrueOnline Broadband service revenue Bt mn 4,932 5,495 , 4,229 2007 2008 2009 Revenue CAGR at 14% per year Broadband: Subscribers ~720k Broadband subscribers Broadband subscribers '000 subscribers Broadband Subscribers 12 % Wi-Fi Wi Fi Subscribers 187 % CAGR CAGR over 3 years over 3 years 632 548 84 691 59 718 27 632 691 2009 2010/Q1 105 443 2007 548 2008 Previous period subscribers Net adds Broadband: Subscribers by speed 2008 1Q10 2009 16% 3% 2% 95% 51% 8% 4% 68% 8% 12% 33% 2 Mbps or les s 3 Mbps 4‐5 Mbps 8 Mbps + + Subscribers migrated to higher speed, resulting in highest ARPU in the market at Bt702 in 1Q10 Broadband: Services Various packages designed to meet unique demands of each customer group g p Download Speed Upload Speed Free Wi‐Fi Monthly fee 30 Mbps – 50 Mbps 2 Mbps – 3 Mbps 4 Mbps Bt 3,600 –Bt 5,600 4 Mbps – 16 Mbps 512 kbps (Lite) – 1 Mbps (Premium) 2 Mbps Bt 599 – Bt2,199 (Online) Bt 799‐Bt2,399 (Premium) 2Mbps 256 kbps 1 Mbps Bt 399 (for 100 hrs of use) Broadband: Value share BMA Nationwide Market Value Bt 7.8 bn Market Value Bt 15.2 bn 3% 1% 1% 1% True 7% TOT 3BB 21% 70% 70 % BMA Value Share CAT Other 21% 37% 38% 37 % Nationwide Value Share Broadband: Market development Broadband Subscribers 3-16 3 16 Mbps Wi Fi Wi-Fi Upto 50 Mbps Free Modem 1-2 1 2 Mbps 256 Kbps Convergence hi-speed internet 128 Kbps Introduction TVC “Ferrari” 10,000 entrance 1,299.- 128kbps Unlimited 2002 Take Off TVC “Pee-pee” 2 month ent. 550.- 256kbps LocalNet 2003 Leadership Growth Rebranding R b di TVC “Life “Lif iis yours” ” Free Modem 590.- 256kbps TVC “Pre Pay hi-speed” 360.’06 hi-speed WiFi pay +250.- 2004 2005 2 “Shark” “Sh k” TVCs TVC New Standard 599.- 1 Mbps/890.- 2 Mbps Convergence Wi-Fi TMV TVS 2006 2007 Metro Leader First to launched 8 &16 Mbps in the midst of high competition 2008 2009 Leader in Speed &Quality 1st to launched 30 Mbps 1Q2010 15 Broadband: 2010 Market Outlook •4-50 Mbps Speed • New Era of Technology ¾ Cloud computing ¾ Web 3.0 ¾ IPV6 ¾ Next Generation Network (NGN) ¾ Next Generation Broadband Network (NBN) ¾ Self Generated Content • Convergence Partnership in mobile broadband market • HD content championship 16 Broadband: advanced apps & HD Content drives demand for higher speed Evolution of Streaming Video and Audio Evolution of Gaming & Tele‐working 1 Gbps 100 Mbps Mb 10 Mbps 1 Mbps 100 kbps 10 kbps 1990 2000 2010 Year (indicative) Source: Booz & Company analysis, Feb 2010 2020 1990 2000 2010 Year (indicative) 2020 Broadband: Technology shift in the market True ADSL, VDSL, Cable, FTTx TOT ADSL FTTx ADSL, 3BB ADSL, VDSL Business Data S i Services Data Communication service for business customers High speed Data Communication Services ( MPLS IP VPN, Metro Ethernet ) Medium/low speed data Communication Services ( DDN DDN, IP Leased line ) CPE managed services ( customer router provisioning, operation and maintenance)) Internet services Multimedia managed services Network architect services Business data: Target customers Business or government entities who deploy data or multimedia communication infrastructure both internally and externally banking & financial institution retail & distribution government telecom provider Industrial & manufacturing services education internet service provider Business data: Market value & share Estimated market value in 2009 = Bt 13.4 bn Business data: Market trend business transaction through internet business continuity and remote office video conference and digital signage out‐tasking of non‐core business cloud computing Business data: Market overview 2007‐ 2007‐2014 2014EE 10,228 Bt mn 3,852 7,552 2007 7,420 8,655 5,125 5,760 6 532 6,532 7,862 8,197 8,646 9,122 9 669 9,669 10 555 11,707 10,555 2008 2009 2010E 2011E 2012E 2013E 4,710 Leased circuit services Source: Frost & Sullivan, Nectec&SIPA Internet access services 2014E International Gateway Int’l Gateway: Business & revenue structure Key supporting vehicle to Broadband business reduce bandwidth cost thru its own gateway leverage for lower bandwidth price from CAT Generate external revenue thru 2 key services: International Internet Bandwidth service International I i l Data D Connectivity C i i services i 2010 expected revenue to TRUE group ~ Bt 300mn Data ggatewayy service as a keyy growth g driver (100% ( ggrowth from 2009)) Revenue breakdown by service 19% 33% 43% 57% 81% 225% Growth 67% 75% Growth 2008 2009 Data Internet 2010E Int’l Gateway network utilized by True Group Phisa nulok Na kh on Sa wa n No ng Kh Udon ai Khonk aen Nakho n Ratch Ch asima a Ba S Ch Ch ng a on ug ko k Su bu k a Tr Phetch ri a Rayon e at aburi g w Prach uap Khiri Khan Chom phon T T W M T G Surat Thani True International Gateway L o e i Hatya i Int’l Gateway: Bandwidth consumption & price trend Thailand national bandwidth Gbps Price trend Bt/Mbps/mth 30 23 Bandwidth used by True Group 17 10 7 2005 Source: NECTEC 2006 Source: Company 2007 2008 2009 5 4 3 2010E 2011E 2012E Int’l Gateway: Market share Share of Internet Gateway Bandwidth CAT 34% ~ 31% TOT 15% Source: NECTEC & Company TIG 16% Int’l BW TRUE uses via TIG Int’l BW TRUE uses via CAT Int’l Gateway: Market opportunities Internet Services Internet bandwidth exponentially grows Internet price, though , compensated by BW growth Inter Internet + Thai content traffic sales to Laos and Cambodia International Data Services International Data Opportunity as alternative in recently opened‐up monopolistic li i market k Increasing demand for Ethernet over IPLC Connectivityy to neighboring g g countries Laos,, Cambodia includingg Vietnam Exploring other source of revenue generation from submarine Fixed line Fixed line: Revenue & subscriber profile 2 customer segments: Consumer (residential) and Business Business segment is more attractive in terms of value Broadband take‐up p rises to 50‐60% of residential fixed‐line subscribers Support transformation of business from voice to non‐voice Subscriber Revenue 33% 67% Consumer As of 2009: Business 1.86 mn subscribers 58% Consumer 42% Business Bt 7,703 mn Fixed line to mobile migration continues Fixed‐line vs. mobile penetration • Fixed line to mobile penetration continues as fixed line tariff is effectively ff i l hi higher h than h mobile bil • As of Mar ’10, nationwide mobile penetration was close to 100% (132% in BMA) Per‐call promotion to slow down revenue decline Features Register via www.truecorp.co.th or dial to 02‐900‐ 8888 from Mar 24 – May 31, 2010 Validity V lidit period i d until til A Aug 31, 31 2010 Customers can make domestic calls (mobile & fixed‐ line) at a flat rate of Bt 3 per call 24/7 Promotion open to both new and existing residential customers 240 K of subscribers registered to the promotion ( ~ 20% take‐up rate) No. of calls increased >120% , no. no of minutes increased >600% Call duration tripled TrueOnline: True Online: Outlook & Strategies Broadband/Data continued to offset traditional voice declines Transformation – expect to bear fruit in the next 2‐3 years Business Data Services: Focus on differentiation through convergence convergence, service excellence Position as solution leader Leverage on partner, increase coverage areas International Gateway: Increase Internet service to sustain future revenue; Expand int’l data market by targeting enterprise customers and building relationship with int’l int l carriers for wholesale revenue Improve overall EBITDA margin through permanent, lower‐cost infrastructure Fixed‐line Tariff rebalancing (i.e., Bt3/call t3/call campaign) Maintain revenue through competitive pricing, AE approach, total solution and customization by account Continuingg negotiation g on IC TrueOnline: True Online: Outlook & Strategies (cont’d) Broadband: oadba d Speed & quality leader; Ultra Broadband positioning Competitive pricing g province p Penetratingg selected high‐demand Triple‐play & convergence Proactive & comprehensive retention Vertical market focus Create the next S‐Curve through new technologies Broadband subscribers >1mn 718k 3.7k Up to 50 Mbps 128 Kbps ADSL, VDSL 2002 2003 2004 2007 2008 2009 >800k Up to 400 Mbps DOCSIS 3.0 2010 • DOCSIS 3.0 • FTTx • WiMAX • Triple Play • HD Content • NGN/NBN FTTx Up to 1 Gbps NGN/NBN 2011 and beyond THANK YOU
