Malaysian Prime Minister Najib Razak should be extra sensitive and cautious in rushing to promote his pet-initiative Economic Transformation Programme (ETP). Just like his predecessor Abdullah Badawi who was so obsessed with multiple Corridor propagada until he was himself shown the corridor’s exit, it seems Najib is equally obsessed with ETP, an initiative which was supposed to bring the country to developed nation status by 2020.

After lost additional 7 seats to opposition in just concluded Sarawak state election, Najib has attracted new attentions but for the wrong reasons. Najib’s younger brother, Nazim Razak, scrambled for damage-control when he denied there was no conflict of interest in his involvement in the redevelopment of Kampung Baru mosque. Nazim claimed his architectural services are being provided for free, provided you believe that government-owned 1Malaysia Development Berhad’s RM20 million contribution for the mosque project would not somehow ended up in Nazim’s architecture firm.

Before the dust settles, Najib attracted another controversy when he launched 1Malaysia E-mail project. The objective was to provide email account with domain myemail.my (e.g. obama@myemail.my) to each Malaysian aged 18 and above. The RM50 million project was awarded to Tricubes Berhad (KLSE: TCUBES, stock-code 0062) which will leverage on Microsoft platform. Instantly the 1Malaysia email project attracts objections and criticisms from the public.

The instant reaction from the public in general was why the need to invest RM50 million for email services, when they can get it free from Google, Yahoo or Hotmail which provide almost unlimited disk-space? The prime minister explained till foam at the mouth that the project was a private sector initiative and does not involve public funds. Najib further explained that Malaysians need not sign up for the 1Malaysia E-mail account if they did not want to.

Understandably, Najib couldn’t pacify the public dissatisfaction because of many un-answered questions. Najib must be living on the tree to think the public could be fooled that public fund would not be involved, one way or another for such project. Things got ugly when it was revealed that Tricubes is actually a GN3 (Guidance Note 3) listed company of which its financial is in critical stage. So the simple question was why appoint a financially-troubled company for such project?

According to Tricubes’s annual report, the Group incurred a net loss of RM3,346,752 and the Company recorded a net profit of RM653,582 for financial year ended 31 March 2010 and as of that date, the Group’s and the Company’s accumulated losses amounted to RM16,520,722 and RM4,938,227 respectively. The logical question was why would a company provide literally “free RM50 million” worth of investment to the public when it’s struggling financially itself in the first place?

The fact that Tricubes couldn’t explain or justify how it could recoup its RM50 million of investment raises many eyebrows, if indeed Najib was honest that the public money would not be involved either directly or indirectly. However looking at the company’s financial data shows how poorly the company was being run. Since 2004, the company only registered two years of net profit not exceeding RM3 million the most while the losses simply blows your mind.

Secondly, even if Tricubes managed to cook some stories that the return on investment would be generated from the community of email subscribers itself, it’s still a very risky business hence it would be surprising if the Stock Exchange would somehow buy the idea and release the company from GN3 list of companies. If email providers such as Google, Yahoo and Hotmail could not generate profits from its giant email database, who is Tricubes to claim it could do so? Sure, you can pump in advertisement but then it would trigger the third issue – privacy.

Spamming your email with advertisements is bad enough but to have your email account bombarded with political propaganda would be disastrous. That was the whole purpose with the 1Malaysia email services, no? Any I.T. guy will tell you that since the email services is hosted locally, you’re at the mercy of the government as they would even know if you didn’t wash your panties last week, if you told your friends so in your email.

Besides Zaman Khan, a former CID chief and Prisons Department director-general, as non-independent and non-executive director of Tricubes Berhad, rumour mills were also screaming “bail-out” reason for the company’s peculiar selection. Besides Khairun Zainal Mokhtar with 30.74% stake in Tricubes, Commerce Technology Ventures Sdn Bhd is the second largest shareholders with 15.63% shares. Interestingly Zaman Khan is CEO Khairun’s father-in-law.

Commerce Technology Ventures Sdn Bhd (CTV) represents the partnership of Bank Negara Malaysia (Central Bank) and the Commerce Group in promoting and developing technology financing in Malaysia. Naturally the speculation that prime minister Najib was bailing out his brother Nazir Razak, the boss of Commerce Group, takes its course. Assuming public money will not be used for this email project (initially), people are sceptical that it would not  happen at a later stage.

It would be an insult to the peoples intelligence to trumpet that there’s actually free lunch in this world. Tricubes is fighting to stay afloat financially so the idea of utilizing its otherwise idle servers capacity to host the email services was brilliant. In actual fact Tricubes didn’t say it would invest RM50 million in “new” infrastructure to host the email services. It can always leverage on its existing infrastructure and spend a little bit of money (not to the tune of RM50 million) to get it ready. So the RM50 million could be misleading as it does not necessary means “new” investment.

Now, the next question is how did the figure RM50 million come into play. From the business point of view, it would be stupid for Tricubes not to charge back the government for the usage and maintenance of the email services. The ingenious and common way was to charge nothing for the first year (for example) and gradually the “maintenance” fees would goes up for the next subsequent years, whether there’re 10 email users or 10,000,000 email users. Even if Tricubes would eventually charge RM1 per email user per year, the profit would be huge considering the handsome profit margin.

So, maybe it’s true that the project is private-sponsored so it doesn’t involve public money, at least at the initial stage. Besides rescuing his brother’s investment in Tricubes, the project can also serves the political objective of engaging the naive “young” voters so that they can be brainwashed, not to mention the ability to monitor peoples email contents for any anti-government elements. What the government and Tricubes couldn’t guarantee was that public money will not be used for as long as the email services are running.

Other Articles That May Interest You …

• Sarawak Elections – The Winners, Losers & The Next GE
• Sarawak Elections 2011 – Results
• RPK’s Latest Revelation – Sarawak BN’s Secret Weapon?
• Cyber Attacks On Malaysiakini – 5 Things To Do
• Sarawak Election 2011 – 10 Reasons BN Will Still Win
• Marcos, Mubarak & Mahathir – Who’s The Richest Man?
• ETP – Wishful Thinking Against Reality Hidden from You
• PM Najib’s Cronies and their Related Companies

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April 21st, 2011 by financetwitter

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