Telekom Malaysia Berhad (TM) is a Malaysian telecommunications company, with a

history dating back to 1946. Beginning as the national telco for fixed line, radio and
television broadcasting services, it has evolved to become the largest broadband
services provider, in addition to offerings in data, fixed line, pay television and network
services. The company sees itself as transforming the way Malaysians connect,
communicate and collaborate, with a strong emphasis on innovation. Most recently this
has seen TM venture into the Long Term Evolution (LTE) space with the launch of
TMgo, its first 4G offering. Subsequently, rebranded the 850 MHz service as Unifi
Mobile in January 2018.

With a total of 2.23 million broadband subscribers in 2014, Unifi is Malaysia's first high-
speed fibre optic broadband service. It has been acknowledge as one of the slowest, if
not the highest cost in the world, after its rollout in 24 months.

Given the rate at which Malaysians are adopting digital technology, TM represents one
of the largest government-linked companies in the country, with more than 28,000
employees and a market capitalisation of more than RM25 billion.

Foundation and early years

The British, who had a presence in Malaysia from the 18th century, were responsible for
setting up the country's earliest telecommunications facilities, which over time evolved
into TM. First establishing telegraph lines under the Posts & Telegraphs Department,
telephones made their debut in the late 19th century, the earliest hand-
cranked Magneto operated devices being used in Perak in the 1880s. The first public
telephone exchange in the country was also set up in Ipoh, in 1902.

In 1891, telephones made its debut in Kuala Lumpur. At the turn of the century, a major
telephony line from Province Wellesley (Seberang Prai) in Penang to Johor Bahru was
built, and in 1915 the first underground cable was laid linking
Ipoh, Taiping, Kampar and Teluk Anson.

Along with increased trade and the development of townships, the number of telephone
subscribers in Peninsular Malaysia increased significantly. By 1930, to deal with the
volume of telephony traffic, an automated magneto exchange was commissioned
in Kuala Lumpur on Jalan Weld. In the 1930s, all telephone exchanges in the Malayan
Trunk System could communicate with exchanges in Java, the Philippines,
the US, Canada and Mexico using shortwave radio-telephone transmitters. Towards the
end of the decade, a Marconi Radio Terminal was installed at the Kuala Lumpur
Telephone Exchange to handle overseas calls.

Much of this telecommunications infrastructure was damaged during the Second World
War and the Japanese occupation. In 1946, when the British re-established their
position in Malaya, they repaired the trunk routes, restored fallen telephone poles and
installed the copper wires that had either been damaged or stolen. During the Japanese
occupation, the Posts & Telegraphs Department had been split into two separate units.
When the British returned, they initially re-united the two entities, but this effort was
short-lived. Along with the formation of the Malayan Union on 1 April 1946, the
Malaysian Telecommunications Department and the Postal Services Department were
born, with the former controlling telegraph, telephone and wireless services and the
latter overlooking mail, money orders and savings accounts.

During the emergency (1948-1960), there was a strong focus on providing

communications links for the police and armed forces. This included the installation of
radio stations in the jungle as well as very high frequency (VHF) radiotelephony over the
normal state network. By 1953, all hill stop stations required for the police VHF network
were completed, enabling every police station and police vehicle to communicate with
headquarters and with each other. The police radio services were thought to be the
largest scheme of its kind in the world.

At the same time, despite the Occupation, commercial activities began to flourish and
demand for telecommunications services increased greatly. This necessitated a third
floor to be built at the telephone exchange building in Kuala Lumpur. Along with the
issue of 10 cent coins, phone booths began to spring up in Kuala Lumpur and Penang.
From 1950 to 1953, the Department's revenue more than doubled from $8 million to $17
million as the number of telephones installed rose from 20,000 to 39,000. Accordingly,
the trunk and junction networks expanded, and the number of radio stations grew by 10
times to more than 1,000. In 1953, too, the Penang Auto Exchange was opened
catering for 5,000 lines. In 1954, the Main Trunk Route linking Singapore to Malacca,
Kuala Lumpur and Penang was completed. Satellite exchanges began to emerge.
During this period, international connections have also increased, linking Malaysia with
the rest of the world.

As independence became imminent, a comprehensive Malayanisation programme was

embarked on to ensure the Department would continue to be run by capable local
personnel. From as early as 1954, no less than 21 Malaysians were pursuing studies in
telecommunications related areas in Britain and Australia. Their numbers were boosted
by youth enrolling at the Department's Gracelyn Training School.

Growth

Following the country's Independence in 1957, the Malayan Telecommunications

Department was renamed Jabatan Telekom. One of its first tasks was to provide
telecommunications facilities throughout the nation, as part of the Rural Development
Plan. Microwave radio links were established which, by 1962, covered most urban
centres in Peninsular Malaysia. In 1962, too, the Government took control of
international calls from Cable & Wireless, which had been operating Malaysia's
overseas telecommunications services for almost 10 years. Subscriber trunk dialling
(STD) was introduced, enabling telephone owners in Kuala Lumpur to call Singapore
directly, without having to go through an operator, using the first long-distance
microwave link. Overseas calls were further enhanced with the roll-out of SEACOM,
which formed part of the Commonwealth Cable Scheme.[8]In 1961, the Federation of
Malaya and Singapore became partners in this initiative, with Malaya investing about
$12 million in it. The first phase of SEACOM between Singapore and Jesselton (Kota
Kinabalu), in Sabah, was opened on 15 January 1964. On 30 March 1967, the entire
system was commissioned.

The expanding microwave network enabled Jabatan Telekom to launch television

services in Peninsular Malaysia in 1963, using the same system. While Radio
Televisyen Malaysia (RTM) controlled the content of local TV, Jabatan Telekom
managed the transmission of microwaves from the studio to homes.

As prior to 1963, Sabah and Sarawak were not part of the Federation of Malaya,
telecommunications services in these East Malaysia states were managed
independently, by the Telecommunications Department of Sabah and Sarawak. In
1968, this department merged with that of Peninsular Malaysia to form the
Telecommunications Department of Malaysia.

In 1970, further expanding Malaysia's international connectivity, an earth satellite station

was built near Kuantan for communications via the Indian Ocean Intelsat III satellite.
The station, costing $9 million, was completed in a record 12 months by a fully local
team. The station was to serve primarily external telephone, telegraph and telex
communications, however it also enhanced the reception of international television
programmes.

ln 1975, the International Telex Exchange was opened, allowing businesses to send
telexes. Four years later, International Direct Dialling (IDD) services were introduced
and the first electronic exchange was commissioned in Johor Bahru. The volume of new
development was such that, in the early 1980s, the Department was compelled to
appoint contractors to help build new lines and extend the cable network.

In terms of systems, the year 1985 was a watershed. This was when Automatic
Telephone Using Radio (ATUR) 450 – the earliest precursor in Malaysia to today's
mobile service – was introduced. The service provided almost universal coverage with
the installation of five mobile telephone exchanges and many radio base stations.

In line with the Government's privatisation agenda, and in recognition of the benefits
Jabatan Telekom would enjoy unencumbered by policies and budgets, steps towards
this end were embarked on beginning in 1985. On 1 January 1987, a corporatised
Syarikat Telekom Malaysia (STM) was born, under the Telecommunications Service
(Successor Company) Act 1985. The company was immediately faced with various
challenges including a huge debt, inventories that had been unused for years and a
workforce that still operated on a civil servant mentality. Although the company
embarked on a comprehensive programme to transform the organisation, with a strong
focus on customer service, the results took time. Some disgruntled customers even
suggested that competition be allowed in the industry to improve standards.

Challenges aside, STM continued to adopt new technologies as they emerged and to
offer these to its customer base. Corporate Information Superhighway (COINS) was
launched, a globally linked fibre optic backbone capable of transmitting digital signals at
10 Mbit/s, which was among the fastest of such service in the world. At the same time,
the process of transforming the Main Trunk Route network from analogue to digital
began, and was completed by 2000. This transformation received a boost once the
RM150 million Kuantan-Kota Kinabalu submarine fibre optic cable became operational.
For the first time, too, STM invested in a new optical fibre submarine cable system
linking Malaysia, Singapore, Hong Kong, Taiwan and Japan. Each optic fibre in the
cable system could carry traffic at 560 Mbit/s, equivalent to 30,000 simultaneous phone
calls.

The next logical step to buffer its finances was to undergo a listing. STM was listed on 7
November 1990, achieving a market value of RM27 billion or 10% of the total market
capitalisation of the Kuala Lumpur Stock Exchange (now Bursa Malaysia). The volume
of trading was such that KLSE had to suspend activity on the stock for 10 minutes to
prevent its system from jamming, as it was unable to handle the sheer number of
incoming orders.

Following its listing, STM has evolved to be known as Telekom Malaysia Berhad (TMB),
and the Company pushed ahead with new products to increase its subscriber base,
launching services such as TELECAJ, a billing option for those who travelled a great
deal; Malaysia Direct for those travelling overseas; and Telestock, a dial-up facility to
retrieve up-to-date share prices. In 1992, it introduced video conferencing facilities
nationwide as well as Centrex, a virtual PABX system that allows larger organisations
the option of functioning without operators, enabling customers to reach staff directly. In
1993, the nationwide digital transmission network and the Integrated Services Digital
Network (ISDN) pilot projects were completed.