KUALA LUMPUR: An industry executive has suggested that the potential Celcom Axiata Bhd-Digi.com Bhd merger as a result of Axiata Group Bhd and Telenor ASA’s rationalising their Asian businesses will not really benefit consumers.
Johor Bahru Internet Exchange chief peering officer Weng Yew Wong said the product rationalisation from the potential merger may lead to reduction of choices and available packages for consumers.
Weng said the potential merger was nothing but a financial rationalisation exercise.
He explained that given the upcoming 5G capital expenditure and the fact that many of the operating markets are fast becoming mature and saturated, the fastest way to deliver shareholder value was to cut cost by merging operation and combining forces.
“Usually price drop will only be realised when a new player is introduced into the market. It is unlikely that there will be any drastic change in the broadband pricing as a result of the reduction in the number of player in the market,” he told the New Straits Times today.
Weng said in terms of quality of service, there was a possibility that the broadband speed could be improved due to the fact that the MergedCo has a significantly more combined spectrum to operate.
“But it is unlikely the coverage will be significantly enhanced, as both DiGi and Celcom have been sharing infrastructure for some time, there is unlikely to have many new areas where the MergedCo can cover which is previously unserved by both parties,” he added.