Sunday, 28 November 2010

Further notes on the 700 MHz spectrum issue

In 1977, I was an undergraduate at UM. In one session of the GED- Great Economic Debate later termed Debat Ekonomi Agung, one of the speakers was Lim Kit Siang. I haven't been to UM for a long time, so I wouldn't know whether there is still the GED sponsored by the FEA.
Somebody from the floor asked him a question concerning Chinese economic predominance in Malaysia. The other speakers were the late Dato Asri and the other one was Dr. Ganapathy ( I can't tell whether this name is correct) I think from UMBC.
His answer was the standard stock in his trade. Yes he said- the Chinese dominate the economy, but who allowed this state of affairs to exist? In other words, he places the blame on the Malay leadership. Malays just can't win.
Today almost 50 years later, the same standard response persists. This state of affairs is the result of those in power (mostly Malays) giving Chinese hongs the opportunities. But there's the added twist. In the hands on these people, so claimed the triumphalist, they can become more competitive etc. The Chinese triumphalist is so over sensitive when criticized.
You are wrong. If YTL is headed by an UMNO feller, I would still write the same way I did. I did so when I wrote about Syabas. I did the same when writing about the construction of the 100 story building. It doesn't matter to me if the 2-3% within the 65% group did the decision making. It was wrong and unjust.
I spoke to a very senior former UMNO minister on a certain subject. I was complaining the ease by which GLCs such as MRCB and UEM buy into non Malay owned property companies under the pretext of achieving economies of scale etc. these are fairly textbook explanations as to why they are doing it. That's bull. Here at this website we have dedicated ourselves at exposing all bulls.
One of the remarks which the former very senior Minister said- the unfortunate truth is that it is the Malays in power who are destroying us. The government didn't bat an eyelid when they went on to save The Mines and Tycoon Lim Kim Siew, the Lion Group and any other Chinese owned business entities. But they threw in all sorts of spanners preventing people like Halim Saad from exercising his put option. Nor Mohamad Yaakob the man who blew away lots of our money in the FOREX market was instrumental in blocking the put option.
What's wrong with those Malays in power? Maybe they have forgotten to be Malays. I see the same futility and hopelessness in the formation of Equinas. In order to help Malays, the Equinas executives have to relearn what it means to be Malays. The main problem with these people is that, having accomplished their stations, they talked themselves into believing, they got there entirely on meritorious grounds. As a result, they expect the other Malays at large to proceed through the same route as they did. They have to get rid of this pompous self-righteousness first.
Look at what is happening to the communications industry. It was once dominated by Telekom Malaysia. Celcom was shaved off and resold time and time again. Other operators applied for cellular license only to flip deals here and there. The Communications Industry it seems is the new battlefield where privileged combatants get to flip deals.
There is some uneasiness in the way MCMC does its job. To achieve a certain level of broad band penetration, we have to give out 1 million laptops. Voila, somebody got to supply the 1 million laptops. In order to be ahead in the market we need the LTE- Long Term Evolution framework in which the 700 MHz spectrum is an integral ingredient. Voila, somebody gets the 700 MHz spectrum.
SPRM or MACC the commission charged eradication corruption should be sending in their troops to study the various cartels like machinations now.
The MACC should also now set its sights on the possible shadowy practices and decision making regarding the award of a monopoly on the 700 MHz spectrum to YTL Communications. Effectively they are giving a head start to YTL for 5 years. The public isn't aware of this goings on and the 4 TELCOS in Malaysia were caught holding nothing but their shrinking testicles.
Sure everyone has to have a national regulating agency. USA has its FCC and Malaysia has our MCMC. Maybe we should be investigating how the decision to award the rights to operate the spectrum is given to YTL only. Sorry but we can't be made to believe that it will be used to offer pay for view TV programs.
Then why the yahooed launching of YES recently offering the cheapest rate for mobile telecom services if there isn't a plan in the future to tap into the spectrum? Sorry YTL, gua takda caya sama lu.
Let us learn from the American experience. Look at what Google did. Even if it did so because of enlightened self-interest. Prior to the bidding process, Google asked that the spectrum be free to lease wholesale and the devices operating under the spectrum be open. Currently many providers such as Verizon and AT&T use technological measures to block external applications.
In return Google guaranteed a minimum bid of $4.6 billion. What has YTL guaranteed the government?
What did the FCC do? The FCC ruled in favor of Google's requests. Only two of the four requirements were put in place. Google had wanted the purchaser to allow 'rental' of the blocks to different providers.
The spectrum, currently owned by broadcasters, has been used for analog television. But it is set to be turned over to the government. Due to its broadcast-attractive physics (like its ability to penetrate walls), this spectrum is desirable for both broadband communications in general and public-safety uses in particular.
The FCC has described the 700 MHz as beachfront property, and has talked up the broadband capabilities of this spectrum swath. About 60 MHz of the former UHF (TV) spectrum is going to be reclaimed by the U.S. government and will be reallocated for public safety and commercial broadband networks.
Without access to the (700MHz) spectrum, the other TELCOs won't be able to expand. With this stranglehold, YTL can either shut out other telcos, or resell bandwidth to them. The other WIMAX provider is P1 but the new spectrum could give YTL total control over the next wave of new technologies in the telco sector.

25 comments:

OneMalaysian,  28 November 2010 at 21:21  

Dear Sakmongkol

Let’s cut to the chase and ask this fundamental question: Why does the government keep allowing private monopolies (such as this YTL deal), and also allowing public monopolies such as water companies to go private (e.g. to Puncak Niaga)?

The simple answer in both cases is that they were awarded to cronies, whether Malay or non-Malay. These deals won’t improve the services to the public or result in lower prices; they will merely make these cronies richer by reducing competition or by encouraging complacency. Why then is this being still done? Do we imagine that those in authority has never studied basic economics, or they truly believe monopolies confer more benefits to the public than costs?

No, the short answer is that those who made the decisions personally benefited through bribery, and they could get away with it because they also control the political process, can render the police powerless, and can defang the ineffectual MACC. This stealing is done in the name of sustaining Malay supremacy and ensuring that UMNO stays in power to protect the Malay interest. Who dares challenge this claim? No one doubts for a moment – and anyone in politics and had run for public office should know this – that vast sums of money are needed (and not officially accounted for) to run an election campaign (both party, state and national). The election machinery has to be oiled and the electorate bribed to vote in a certain way. And money is also needed to buy frogs to maintain power. Those who walk the corridors of power know this, and those who know them also know this. This is the worse kept secret.

And of course the cronies know this too. That is why they are so useful because they can be trusted to “lu tolong wa, wa tolong lu” – you scratch my back, I scratch yours. Notice that the cronies are extremely well connected Malays (Halim Saad is one of them), and so are the non-Malays (e.g. the Yeohs of YTL). Notice also that the cronies are always the same people – you can only trust those you know well, and have done “business” with before. Remember, in this game, they must not talk, and that you must trust them absolutely to deliver their part of the bargain (i.e. part of the loot) once they have got the licence or deal. You cannot sue in court if after they got the deal they renege on it and play you out.

Now, where does the Malay interest come in, not to mention those of the other Malaysians? Keep UMNO and we keep this corrupt system. The Malays will always get the crumbs whilst their leaders steal what is due to them and blame the non-Malays.

Anonymous,  28 November 2010 at 22:13  

ETP? Transform what? buzzword means nothing coz its the same cronyism at the end of the day. look at sweetheart deal to Naza family. Its no ethnicity, its just the right networking and the fatcat politician is reaping the dirty rewards too.
dato', i marvel at your tenacity and unwavering belief in UMNO. No, it aint gonna change until UMNO is removed from power. rejuvenation may truly start after that. Until then, the fatcats will continue to grow fatter and you, Dato' will continue at the fringe finger-pointing the wrongs of UMNO. This is the reality, Dato'.

Anonymous,  28 November 2010 at 22:18  

Dato, why is it umno is so sensitive about this ketuanan melayu thing. I for one working as a division one government officer product of the nep meluat about you umno people talking over and over about this ketuanan thing. It's been spelt out in the 153 udah le tu,, no need to hoohah about it.What say you a liberal umno, Dato. What's in it if we are called the tuans when the truth is the other way round Dato.Lets move on la..you umno people

sakmongkol AK47 28 November 2010 at 22:23  

anon 22:18

you a division one officer respond like this? very sorry for you.

Anonymous,  28 November 2010 at 22:36  

Thank you,I 'll take from you dato.Should i be sorry for being so naive about this ketuanan thing.We the goverment officers are always been made at the disposal of the political masters.Yes we are called the tuans day in day out but what's in it when these political masters called the shots and we are seen as the bad guys.

Anonymous,  28 November 2010 at 23:34  

Dato' Sak

When people talk about Malay entrepreneurs, I bet none of them would mention Ramly Moknin of Ramly Burger. I personally would rate him as the greatest. Think of the thousands he has indirectly nurtured and inspired. Who else has singlehandedly created an industry? This is a true rags-to-riches story, an absolute Malaysian Dream epic. The best part is he could have kept everything to himself, created a Ramly Burger chain and get rich to all his heart's content. But he didn't, he shared his masterpiece with all the little peddlers everywhere. And with all their creativity thrown in, not even one burger joint taste the same. Amazing!. He didn't need fake PhD's, 'eight-ball' scams, fat government contracts or AP's to get rich and 'motivate' others along the way. He did it the old fashioned way. And I would think he did not have to 'hulur' a few small change to get a door opened for him.

Anonymous,  28 November 2010 at 23:53  

That is nothing, compared to this Dato'.

On 8 August 2009, P. Gunasegaram wrote in the STAR “As at Dec 31, 2008, the airline had RM4.62bil in cash, reducing by a huge RM850mil to RM3.77bil as at March 31, 2009 and by a further RM830mil to RM2.94bil as at end-June 2009. That’s a rapid rate of cash depletion of almost RM1.7bil in a mere six months.”

On 25 Nov 2010, MAS said “For the nine months ended Sept 30, MAS reported a net operating profit of RM127mil against an operating loss of RM644mil from a year earlier. For the same period, its net profit was RM9mil against a loss of RM120mil before. Its balance sheet with cash and negotiable deposits was RM2.26bil as at Sept 30.”
Summary:

End 2007 cash was RM5.2 bil
End 2008 cash was RM4.62bil
End 2009 cash was RM2.94bil
¾ 2010 cash now RM 2.26 bil

20000 staff getting gaji buta.

Sleepyhead.

dua sen,  29 November 2010 at 00:00  

Dato, IMHO it is not that the power that be favours the chinese. I think it is more of giving preferences to select few. (Malays (Naza's - melayu asli ?, Chinese, Indians).

I think we are too engrossed with equity percentages rather than focusing empowering every rakyat to move up to higher income ie providing good education. Government role should always be to make sure that there is fair competition and no monopoly by any quarters. NEP has indeed been 'bastardised' to favour the select few. A simple analogy would be that if you have a family of 7 and you have a loaf of bread and a jar of kaya. What happens if you feed your favoured child more bread and kaya ? Or would you rather tell all your children that each one is entitled to 2 pieces of bread with kaya and if you want more then you have to go out and get it.

So I don't think it is correct to generalise that all Chinese receive durian runtuh treatment. It is only select few, those that in carcosa with cigars !

Anonymous,  29 November 2010 at 00:07  

one before the bed ...... you people of umno better change but i don't see it coming soon

Anonymous,  29 November 2010 at 00:50  

the first president for Singapore is a Malay.. that's how it start.. the rest of that you need to think and I know you will understand. all about cronies with no more benefit to rakyat asal. More worst risk for Malay in Malaysia to take. Country with a sad majority is a real 'poor' country..


Some people can be divert with subjective issue but lot of Malay nowadays is very objective. We know what we want and what we have.

Cronies still can continuously happen with or without UMNO or ETP.. even cronies also possible can be reduce even with UMNO/BN in power. No need to go further, just watch the PR drama series.. 5 states with thousand of annoying story. More than that all individual party in PR have their own 'social network', already.

syami,  29 November 2010 at 01:23  

Dato,

Better to get your facts right before you rant. Statement form MCMC released today is below.

Media reports over the past month said it is believed that the 700Mhz spectrum band is to be given to tycoon Tan Sri Francis Yeoh’s YTL to operate its hybrid television service slated for end 2011.

The MCMC clarified that it was assessing a detailed business plan by YTL for the roll out of digital pay TV and not 4G mobile services as reported.

Further, it said, under Malaysia’s National Spectrum Plan, 700MHz spectrum band was allocated for broadcasting service and not for Long-Term Evolution (LTE) or 4G mobile services as speculated in the various media articles and reports.

“The ownership of all spectrum bands remains at all times with the Government of Malaysia,” the statement said. — Bernama

As you can see, the 800MHz band is reserved for LTE and Telcos. 700MHz is for TV broadcast. 700MHz has nothing to do with the Telcos.

This is all about Ananda protecting his monopoly at the expense of the rakyat's choice and better TV service.

Why is it that you don't question Astro's monopoly and all the other questionable things that happened when you were in Govt?

sakmongkol AK47 29 November 2010 at 02:37  

syami,
i welcome Bernama's clarification if it leads to breakup of the monopoly by Ananda's astro. many others and i have always been asking why was Ananda given a monopoly.
but then, why breakup a monopoly by creating another? wouldn't it be better to open up the 700 MHz spectrum so that more than just YTL can operate hybrid broadcasting? then we the public will have more than just 2 choices. MCMC should invite other interested parties too.

Anonymous,  29 November 2010 at 03:57  

Give me an IPP;exact same terms as YTL's and lets see whether Melayu can manage.Btw,,prior to that throw in a 50% profit direct nego hospital job.

The 700/800 Mhz spectrum..dish it out to my good friend;also a`Melayu n on an exclusive basis n no upfront fees.He is good at auctioning and I am sure he can raise minimum RM 3 billion from each of the 6 potential spectrums.

Check us out in 5 years..then decide if YTL/Anandas are really the good biz ppl or just happen to be gifted the goods.

Malaysia is so funny.Project RM 3 million ada 40 Bumi tenderers but real plum direct nego goodies are all pretty exclusive to non Bumi tycoons .

Then when RM 3 mil project fail say Malays not good.Stupid right?

When was last time Gamuda won a competitive bid in Msia?

Anonymous,  29 November 2010 at 08:17  

There are Malay and non-Malay cronies and I think UMNO can tap more moolah from the non-Malay cronies as they are more 'generous' and also more productive.
What is happening today are just symptoms of a disease that has solidly been in place for years.
Every single economic venture must ultimately benefit the UMNOputras. Never mind if the venture is given to a Chinese or Indian. The beneficiary will be an UMNO Malay.
It's personal interest above national interest.

Anonymous,  29 November 2010 at 08:31  

The 700MHz & 800MHz war heading to where? I think Najib has to answer this question.

Anonymous,  29 November 2010 at 09:12  

There is no doubt in my mind that this system of racial segregation is all about money and power. Unfortunately, most Malays are hoodwinked into it allow it to happen day in and day out. Groups like Perkasa are vehicles to allow this to continue. The funny thing is corruption knows no race and both sides play the game equally well.

Most of the Chinese towkays know about this system and some are pretty happy with it too but in the long term it discourages competition. We will never see the Facebook and Googles in Malaysia because of this inbred culture.

joeawk 29 November 2010 at 10:44  

I agree with Anonymous, 28 November 2010 23:34 . He is a malay hero, he nurtured so many, give so much joy to so many Malaysians.

He should be made an example for all. He is like colonel KFC.

Hooray. YTL, Halim Saad, they are blood suckers.

Anonymous,  29 November 2010 at 12:15  

Everybody at EPU knows how YTL conduct their proposals. Previously, EPU officers are subjugated by their minister (eg Effendi Norwawi)to agreeing to the sly proposals submitted by Francis Yeoh. I believe it is the same now.

For instance,YTL sponsored the money losing shows, 'Puteri Gunong Ledang' owned by Effendi Norwawi's wife, Tiara Jacquelina. That's quite some serious cash. Would be be good to find out who else benefits this time round. Doesn't take a genius to figure that one out. SPRM will be kept busy just investigating YTL's government dealings alone. Trust me!

MakYong,  29 November 2010 at 15:28  

Those powerful figures are mostly mamak or melayu celup, so they are not really interested in real melayu welfare!

Anonymous,  30 November 2010 at 22:45  

I’m wondering now if we can talk about your sites statistics – search volume, etc, I’m trying to sites I can buy adspace through – let me know if we can talk about pricing and whatnot. Cheers mate you’re doing a great job though.

Anonymous,  3 December 2010 at 00:52  

This is my first time i visit here. I found so many interesting stuff in your blog especially its discussion. From the tons of comments on your articles, I guess I am not the only one having all the enjoyment here! keep up the good work.

MCA steals for Towkays,  3 December 2010 at 17:09  

The frequency spectrum is a natural resource of Malaysia. Therefore UMNO and Rais Yatim had unconstitutionally awarded the WIMAX frequencies to Chinese gambling companies, YTL and RedTone.

Instead of 70 percent to the Malays, MCM awarded 70 percent to the Chinese.

The selling of satellite frequencies to ANanda a Malaysian
Indian by Khazanah/TM is also unconstitutional as this means the Indians control 100% of our satellite resources. TM is owned by Malaysians and Malays engineers and management run the companies.

The Chinese are jealous and put up stupid, unfair and ridiculous demands on TM because they want to monopolise communications in Malaysia.

TM is owned by the Government and whatever profit goes to the people and not make multibillionaires like Ananda or Yeoh Tiong Lay. They are not smart. They are greedy capitalists who have corrupted UMNO and MCMC management into giving them obscene wealth with monopolies while the normal people struggle to feed their families.

Perkasa or Malays NGOs must sue MCMC or the Government as has been done in Thailand or India where corrupt regulators have been sued.

SPRMourhope,  3 December 2010 at 17:20  

Anonymous Anonymous said...

" Everybody at EPU knows how YTL conduct their proposals. Previously, EPU officers are subjugated by their minister (eg Effendi Norwawi)to agreeing to the sly proposals submitted by Francis Yeoh. I believe it is the same now."

Now this is interesting. The SPRM must investigate Effendi Nawawi the stupid Sarawakian.

What is it with Sabahan/Sarawakian who come to Semenanjung and leave their wives for Malay actresses?

How did a poor boy from Sarawak managed to pay 16 million for his wives projects. He is not najib who use 211 million tax payers money in 2 years for the con permata job.

Where is the einstein? What are we getting for 210 millions on stupid boys. If its just singing and dancing then send them to AFUNDI is cheaper and better!

Sorry I digress..anyway sent in the SPRM to check on the electric robbery of IPP by YTL and Effendi Nawawi!

Anonymous,  4 December 2010 at 01:06  

Easy. Broken promises over and over again. Minyak naik. Kaya bertambah kaya. What to do except to register protest vote next GE.

Anonymous,  10 December 2010 at 00:57  

Just want to say what a great blog you got here!I’ve been around for quite a lot of time, but finally decided to show my appreciation of your work! Thumbs up, and keep it going!

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