“Flex”, a digital telco that will disrupt the Malaysian telecom market

Amir, Alfie Shahrein (2023) “Flex”, a digital telco that will disrupt the Malaysian telecom market. [Dissertation (University of Nottingham only)]

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Business Concept: Like how Airbnb and Uber disrupted the hospitality and the public transportation market respectively, Flex will be a digital-native telco that provides telecom services to digital-native customers or Gen-Z, without owning any assets. With a cost-focus and differentiation-focus strategy, Flex will challenge the incumbents through its flexible services and offer values that matter to Gen-Z. This includes potential savings through its usage-based billing as opposed to the volume-based plans available in the market today, end-to end digital customer lifecycle, personalised experience as well as environmental and ethical values.

Key Differentiator: While the incumbents are also expanding their digital initiatives, their offerings still lack innovations and values for Gen-Z. Flex’s value propositions will provide the company with an edge when competing in the Gen-Z segment. Underpinning Flex’s offerings is the lean operations that enable it to be more agile and efficient in adapting to the continuously shifting market demands, especially from the Gen-Z, whereas competitors are often slower to respond to a change in the industry due to the legacy telcos’ organisational processes and business workflow.

Financial Highlights: The business also has a promising outlook. Unlike other telcos that spend billions of dollars on network Capex annually, Flex will require only RM2.95 million to start and run the business for the first year. This includes an initial investment of RM0.92 which mainly comprises upfront costs for network wholesale and digital telco platforms. With a target of only 144,000 subscribers or 0.3% of the total market share in five years, Flex’s cost-plus pricing model is expected to drive its revenue and record its first profit in Q3 of the second year of its operation. Its profit margin is projected to grow to 21% at the end of the fifth year. The investment is also estimated to break even in two years and 325 days with a considerably high internal rate of return (IRR) of 14.4%.

Current Position: Flex will start as a private entity run by the founder as the CEO and a small team of nine young industry experts across key business functions who are fluent in their respective fields, but also understand Gen-Z. Flex will operate as a telecom service provider with a license from Malaysia Communications and Multimedia Commission (MCMC).

Item Type: Dissertation (University of Nottingham only)
Depositing User: Amir, Alfie
Date Deposited: 22 Feb 2023 08:15
Last Modified: 22 Feb 2023 08:15
URI: https://eprints.nottingham.ac.uk/id/eprint/71062

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