Some thoughts post the announcement by PM last Friday where MCMC is scheduling a briefing later today. Most of what was announced weren’t new (littered with JENDELA). Except for conditional approvals to build hyperscale DCs (including TM) and submarine cable investments, details were very sketchy on the 5G model proposed which have raised more questions. - Queries are on the SPV (owed by the government)- structure, funding and operational issues. More specifically, the policy deviation from the single entity/consortium approach mooted by the PH government with spectrum parked under a SPV which will then undertake the 5G network rollout. The consortium approach, we understand, has never been practiced by any market and elicited severe backlash from the industry then as it would stymie rollout efforts with concerns on who will lead the rollout (TM ??). There were also concerns that if TM was to be assigned the 5G spectrum (as a NetCo), wholesale arrangements would be lopsided as this would favour the incumbent. In our view, the government may have settled for a middle ground with the independent SPV owing the spectrum and rolling out the infrastructure with wholesale access granted to telcos (with explicit conditions). This however does not address the issue of red-tape and the fact that spectrum will dominated by a SPV (not via a competitive tender), a hybrid model of sorts. - In our view, a government-owned SPV undertaking the rollout does not encourage facility/network-based competition and innovation as telcos are not incentivised to rollout their own networks. Mobile operators would then compete on service levels/product differentiation. - We believe infrastructure sharing/collaboration among the mobile operators will remain key as telcos are already doing this as part of their 5G demonstration projects (5GDP) projects - We continue to like the wireline/integrated/infrastructure-backed players- TM and OCK Group.
MyDigital Blueprint (extending the tech value chain)
We believe there will be more opportunities in the e-government space where 6 clusters – economy, society, emerging technology, digital talent, digital infrastructure, and data & government – have been identified. Under the ‘Cloud First’ strategy, the government has targeted the migration of 80% of public data to hybrid cloud systems by the end of 2022, in a bid to reduce government costs and improve efficiency in information technology management in the long run.
Separately, cashless transactions would be the preferred method of payment in Federal and State-level agencies, as well as local councils by 2022. Between MYR12bn to MYR15bn will be invested by four cloud service providers (CSP) in Microsoft, Google, Amazon and Telekom Malaysia (Huawei) to build and manage hyper-scale data centres and cloud services. Three local ICT (information communication technology) companies have been identified as managed service providers (MSP) to work with the CSPs to manage their services to agencies in the public sector.
We believe that this will be a structural change for the IT-related procurement process in government sector, moving towards an opex model from current capex model currently, where most of the storage, server and productivity suites are purchased outright. It will be fee-based or subscription-based model for the software/productivity tools in cloud services. The master procurement will be centralised under master licensing models between the government and the respective CSPs and MSPs. Meanwhile the MSPs will be tasked to promote the cloud adoption and obtain the buy-off from respective agencies alongside system integrator(s), which are yet to be identified.
While the overall size of cloud services for MSPs is yet to identified, it will largely depends on overall government’s budget in relation to cloud storage and cloud computing, ultimately. The direct beneficiary in this space would be AwanBiru Technology, which offers a full suite of cloud-based products from Google is one of the appointed MSPs. Other potential beneficiaries include, Censof Holdings, Omesti, HeiTech Padu and Dagang NeXchange. For cashless transaction initiatives, payment gateway, acquirer and solution provider alongside e-wallet players may be benefiting from the adoption of cashless transactions among government agencies. These include GHL Systems, ManagePAY Systems, Revenue Group, Censof Holdings Green Packet (Kipple Pay), Axiata Group (Boost) and CIMB Group (TnG).
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Algorithm_trading
80 posts
Posted by Algorithm_trading > 2021-02-20 19:11 | Report Abuse
Sure gonna goreng this one next week. Good to enter first thing monday to ride