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ISP pushes into new territory

A demonstration tool containing fibre optic wires used to illustrate high speed internet. Justin tallis/Afp
A demonstration tool containing fibre optic wires used to illustrate high speed internet. Justin tallis/Afp

ISP pushes into new territory

Today Communication, Cambodia’s youngest internet service provider (ISP), is looking to gain traction in the Kingdom’s crowded fixed-line internet market with a bold move into the provinces, where mobile internet dominates the market.

Steve Miller, the company’s general manager, said yesterday that the ISP has already opened its first point of presence in Takhmao, and will expand its fibre-optic network and services to Siem Reap next month. It will also look to offer fixed-line subscriptions in Sihanoukville, Poipet and Kampong Cham within the coming year.

He said the ISP, which launched last August, would continue to focus on providing premium services to businesses, but that expansion into the provinces would require catering to homeowners as well.

“The way to get your foot through the door is with residential customers,” he said.

“We see ourselves as a premium brand, so ultimately we are trying to get into the corporate market, but we have to start with both.”

The Ministry of Posts and Telecommunications put the number of fixed-line internet subscribers at 82,926 as of June 2016, compared to more than 7 million mobile internet subscribers.

Miller said he believes the growing demand for reliable internet in the provinces, driven by wealthier homeowners and growing businesses, could allow Today Communication to find customers in a market vastly dominated by cheap mobile internet.

“Mobile internet is not nearly as reliable as fixed-line internet, so the market is different,” he said.

“There are residential customers who depend on more reliable internet, which is the market we are targeting.”

Businesses expanding into the provinces will also need reliable internet, Miller said. One of the company’s increasingly popular products is virtual private network services that link different branches of a company with a secure and fast connection, he explained.

Today Communication is attempting to differentiate itself from other ISPs through the quality of its internet, but the company faces difficulties from the low prices created by a saturated market, Miller said.

“I think the market is full, but it is growing, so our target is new businesses and disenfranchised existing businesses,” he said.

“We don’t have the budget to make a big splash in the market, so we have to compete on quality and make a name for ourselves.”

Steven Path, president of the Cambodian ICT federation, contends that the Kingdom’s ISP market is oversaturated, which has led companies into a price war to attract a limited number of customers. However, he said the demand for fixed-line internet in places like Siem Reap, Battambang and Poipet could increase as businesses develop in those areas – though mobile internet will likely continue to dominate the market.

“When you talk about internet connectivity in Cambodia, you see that 80 or 90 percent of it comes from mobile devices,” he said.

“Telecoms are rapidly expanding their 4G networks and it remains the cheapest option.”

For ISPs expanding beyond Phnom Penh, quality and price will be important factors to attract customers, but one the most important elements to gain limited market shares will be name recognition, Path explained.

“Enterprise internet usage is going to be driven by the brands people are aware of and the companies that they can name,” he said.

“The challenge is going to be branding, because if you have the best quality but no one knows about your company, it’s going to be hard for you to expand.”

“My guess is that the demand will come from cafes, hotels and guesthouses in places like Siem Reap and Sihanoukville that need to satisfy the online demands of tourists,” he added.

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