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Foreign Investors choose to exit U Mobile

U Mobile is reshaping again, probably the fourth time.

In April 2009, I made a blog post titled “Complications in U Mobile?” which reveals part of the issues that U Mobile is facing, even now, however the post was removed at the request of U Mobile with promise that they will respond to me. If you had been following my blog, you know that they never responded.

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This time their two foreign investors are saying “Goodbye” to U Mobile. KTF in April 2009 said that it will be selling all its 16.5% stake in U Mobile, while last week DoCoMo also decided to do the same thing. It is reported that the departure of KTF and DoCoMo is because of their “disagreement with other shareholders over management”, however there could be more reasons, but I guess I won’t be able to share it here.

There has been talks/rumours that the new management team that has been put together by Tan Sri Vincent Tan involves an appointment of a CEO who was previously with Axiata. However this remains a possibility until U Mobile announce the new management team.

What U Mobile needs to do?

Here’s a simple conclusion on the company:

Pricing: Not the lowest
Free Phones: Competitors has better offer
3G Coverage: Expanding but like a turtle
Advantage: None
Mistakes: Killing DVB-H, losing a number of good staffs, Kenneth Chang (Executive Director of U Mobile) is no longer running the day-to-day business at the company, foreign investors leaving, failed business plans.

First up, it needs to be different from the other telcos. When it first started, the company was shouting about its 1-second billing, apparently it is not working since the company only has close to a couple hundreds of thousand customers(not even 1% of the mobile market), plus their mobile plans has been the same for a very long time if compared to competitors.

On top of all these, I can confidently say that they have no advantage at all over their competitors. The question here is, what are the goals of U Mobile? Does it plan to capture the voice & sms market in Malaysia with their 3G spectrum?

As a 3G operator, what type of 3G services do they have? The last time I met one of the person in the content development team, they were still trying to learn about mobile contents! U Mobile has to re-look at their business plans- Who’s their target of subscribers? What do these subscribers want?

In comparison to Tune Talk, the new MVNO company had 10,000 subscribers way before launching their service! If U Mobile wants to remain in the industry, it has to be aggressive, find the right people to run the company, and look above voice, SMS and even 3G! But right now, it is no where close to that.

Why should you use U Mobile when DiGi, Maxis and Celcom are better in all aspects (management, offering, investment)?

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About Kugan

Kugan is the founder of MalaysianWireless. He has been observing the mobile industry since 2003. Connect with him on Twitter: @scamboy