Kuala Lumpur, 31 October 2006 - MiTV Corporation Sdn Bhd ("MiTV") announced today that it is at the final stage of finalizing a contract to award its 3-phase national roll-out plan after a thorough review of its existing technology platform over the last few months.
MiTV also announced today that it will adopt an open digital terrestrial broadcast technology based on the standard for digital terrestrial television known as Digital Video Broadcasting-Terrestrial (DVB-T). MiTV will also migrate from the existing video codec standard to the MPEG4/H.264 advance digital video codec standard. MiTV also said that for greater efficiency, the pay-TV operations will be co-located with MiTV Networks Sdn Bhd's 3G core network centre in Subang Hi-Tech, Shah Alam, Selangor.
The additional investment required is estimated at RM300.0 million to roll-out the new broadcast network and infrastructure, investing in the new MPEG4/H.264 set-top boxes for sales and distribution and acquisition of new content. The proposed contract for the new broadcast network and infrastructure will be on a turn key basis that will cover the Klang Valley and its fringes for phase 1. The new broadcast network and infrastructure necessary for MiTV to re-launch its services is expected to be ready within a 9 month time frame. This will include re-location of the existing broadcast facilities and network operations centre to Subang Hi-Tech, the installation of high powered transmitters and the development of the new MPEG4/H.264 set-top box.
Phases 2 and 3, which will cover the rest of Peninsular Malaysia, are expected to kick off within a year after the successful launch of phase 1. "Our business model is scaleable and this gives us the flexibility to manage the rollout of our service. Further details will be announced as soon as the contract is awarded." says Dato' Rosman Ridzwan, Chairman of MiTV.
MiTV said that the switch of technology platform would enhance its business plans as it expects the decoders or set-top box, as it is commonly called, to be cheaper. The Company also said that the additional system hardware required is not substantial and almost all of its existing equipment can be upgraded and re-deployed for the new broadcast network.
To streamline its corporate structure, MiTV has been made the holding company and will hold:
1. 100% of MiTV Networks Sdn Bhd which will operate the 3G services; and
2. 100% of MiTV Broadcast Sdn Bhd which will undertake the pay-TV business.
MiTV's CEO for pay-TV, Ho Meng was up-beat about the technology switch. Asked about the switch, he said "MiTV started with the existing video codec standard which at that time enabled MiTV to deliver more TV channels per UHF frequency for its terrestrial pay-TV service. However, to-date, we have not heard of any other adopters of the standard for terrestrial transmission".
He added that MiTV has demonstrated that its unique technology platform worked in a terrestrial environment but admitted that there had been many complaints and negative feedback on the instability of the set-top boxes sold. Ho Meng also said that MiTV had not been able to overcome these technical challenges despite their concerted efforts.
"We are very excited about the switch to MPEG4 platform as this is the latest standard that has evolved from the highly successful MPEG2 version which has been widely adopted for satellite and terrestrial transmissions" added Ho Meng. "The MPEG4 standard and the DVB-T standard will allow MiTV to transmit higher quality digital content without compromising on the capacity of our broadcast frequencies. Moreover, the MPEG4 standard can deliver high definition TV ("HDTV") viewing experience to HDTV ready TV sets" he said.
To plan for the massive relocation and change in technology platform, MiTV said that it has suspended all marketing and sales activities but will continue providing its service albeit, on a reduced scale by broadcasting 12 channels.
Consequently, the staff strength has to be reduced by around 200 through a retrenchment exercise implemented today while retaining around 110 staff to support its on-going operations.
All retrenched staff shall be paid the appropriate retrenchment benefits. "As we intend to complete the switch over and re-launch the service by the 3rd quarter of 2007, we would like to re-hire those staff who had been retrenched." said Dato' Rosman Ridzwan.
"We sincerely regret any temporary disruption viewers may experience during this transition period and we promise to be up and running delivering what we have set out to do. Existing subscribers will continue to enjoy the service at no charge until further notice." he added.
MPEG4 is a standard used primarily to compress audio and video (AV) digital data. Introduced in late 1998, it is a designation for a group of audio and video coding standards and related technology agreed upon by the Moving Picture Expert Group (MPEG). MPEG4 absorbs many of the features of the earlier MPEG-1 and MPEG2 and other related standards. The compression and decompression ("codec") component of MPEG4 is popularly referred to as Part 10 ( H.264/AVC). MiTV will adopt the H.264 Advance Video Coding codec standard to optimize bandwidth savings.
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