KSC The Only Major ISP with Profit from Day One Prof.Dr. Srisakdi Charmonman [email protected] then...
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Transcript of KSC The Only Major ISP with Profit from Day One Prof.Dr. Srisakdi Charmonman [email protected] then...
KSCThe Only Major ISP
with Profitfrom Day One
Prof.Dr. Srisakdi Charmonman
[email protected]<www.srisakdi.th.com> then click <Internet KSC>
Topics of Presentation
1. Introduction
2. History of KSC
3. KSC Philosophy
4. KSC Achievement
5. KSC Future Prospects
1. Introduction1. Bill Gates “Profit from providing
Internet connection can be effectively
rounded to zero.”
2. For one single year of 1998: Average
market caps of Internet-related companies
increased seven folds in the USA.
3. None of those companies were profitable.
4. KSC is an exception, i.e. profits from day 1.
2. History of KSCCo-Founders:1. Prof.Dr. Srisakdi Charmonman
2. Dr. Kanokwan Wongwatanasin
Registration with Government
• 7 Jun 94 Internet KSC
• 21 Dec 94 KSC Commercial
• Jan 95 KSC started operation.
• 27 July 95 Jasmine purchased 25% of KSC.
19 95Jan HRHPri ncess Maha Chakri
SSSSSSSSSS SSSSSS SSS SSSSSSSSSSSSS
Internet Gateway to the USA.
KSC Group of Companies
CAT(Communications
Authority of Thailand)
OnlineAdvertising
Goldsite Co.,Ltd.
InternetShopping Mall
Co.,Ltd.
Jasmine InternationalCo.,Ltd.
Prof.Dr.SrisakdiCharmonman
Dr. KanokwanWongwatanasin
KSC GroupElectronicCommerce
Co.,Ltd.
65%35%
30%25% 45%
100% 100% 100%
Internet KSC(Internet Knowledge Service Center Co.,Ltd.)
100 Million Baht Capital
KSC Commercial(KSC Commercial Internet Co.,Ltd.)
15 Million Baht Capital
3. KSC Basic Philosophy3.1 No Borrowing Unless Completely
Necessary.
• Usual: Money makes money.
Must borrow money to invest.
• KSC: Use advanced payment from customers
& shareholders’ money to invest.
• Had KSC borrowed from the USA,
KSC would have been badly bruised.
(from 26 Baht/$ to 37-52 baht/$)
3.2 Assumption University as Incubator
• Started at AU rather at a business district.• KSC could rely on students, staff and facu
lty of AU to serve part-time at KSC.• KSC can mobilize any number of highly qu
alified manpower.• Example: Asian Games required 120 home
pages designed and implemented within 3 days and no other ISPs could do it except KSC.
3.3 Hardworking• Internet technology and competitions are ve
ry dynamic.
• Working 8 hours a day is not enough.
• The co-founders have been working 16 hours a day, 7 days a week.
• Several contracts concluded and publicity achieved because of hardwork.
• The co-founders hold 75% of KSC and can make important decisions right away. Then report to the Board for ratification.
3.4 Win-Win Cooperation• In politic and business, neither foe nor
friend remains permanent.
• Your foe becomes your friend if you let him share your benefits.
• Your friend becomes your foe if you take benefit away from him.
• Therefore, KSC always negotiate to arrive at a win-win cooperation.
• KSC is highly flexible in negotiating with any potential business partners.
4. KSC Achievements4.1 KSC has no debt.
KSC has 100 million baht
(about 2.7 million US$) cash on hand
from advanced payments,
sale of 3, 6, 9, 12 months
of Internet cards
(similar to phone card,
and only about 30% usage).
4.2 Profits of Internet KSC Group1998 profit of Internet KSC 19.43 M Bht
1998 profit of KSC Commercial 17.72 M Bht
1998 Total profit of KSC Group 37.15 M Bht
(About 1 million US$)
Internet KSC owns 65% of KSC Commercial.
Consolidated profit of Internet KSC
= 19.43 + 0.65 x 17.72
= 30.95 million Baht
First 4 Years Consolidated Profit of Internet KSC
0.94 0.67
10.6
7.46.8
4.5
31
21.7
0
5
10
15
20
25
30
35
Profi
t in Million
Baht (
Roun
ded)
1995 1996 1997 1998 Year
Income Before TaxNet Income
Analysis of First 4 Years Sales and Profits
Sales: Individual 40% Corporate 40%
Other 20%
Assumption: To obtain Indices for future projection, it is assumed that sales and profit are distributed equally for individual and corporate.
Result of first 4 years:
Avg.sales : 400 Bht./ind./yr 0.4 MBht./corp/yr
Avg. profit: 40 Bht./ind./yr 0.04 MBht./corp./yr
10% 10%
4.3 KSC Customers in 1998
Individual LAN (educational) 195,000
Individual Dial-up 60,000
Total number of individuals 255,000
Corporate Web hosting 200
Corporate Leased line 180
Total number of corporate 380
Rough Estimate of Individual Internet Users in Million
* Notes : 12 Million = 20 % of population of Thailand
1998 2006
Thailand KSC Thailand KSC
1. University LAN 0.275 0.100 1.5 0.45
2. College LAN 0.110 0.053 0.8 0.24
3. School LAN 0.110 0.042 0.8 0.24
4. Indiv. Dial-up 0.105 0.060 8.9 2.68
Total 0.600 0.255 12.0* 3.61
Partial List of Corporate Customers of KSC
• American Embassy
• International Labor Organization
• Thai Shell
• Siam Cement
• Krung Thai Bank
• Dept. of Intellectual Property
• PacLink
• Etc.
• Bangkok Metro Admin.
• National Housing Authority
• Royal Forestry Dept.
• Office of National Education
• Mahidol University
• Ramkamhaeng University
• NTTI (Thailand)
• Etc.
4.4 KSC Bandwidth to USA- April 8, 1999 12 Mbps - In 2000 45 Mbps
- Nov, 1999 16 Mbps - In 2006 180 Mbps
To conserve KSC bandwidth to USA:• 140 Gb Proxy Farm at KSC NOC.
• Proxy at every building and every LAN.
• Programmed downloading 1:00 - 5:00 am.
webs to use next day.
• Large Leased Lines to local exchanges.
5. Future Prospects of KSC • KSC is the first and largest ISP in Thailand.• KSC will remain the largest ISP in Thailand.• KSC will provide all kinds of Internet-related services.5.1 KSC Branches in all 76 Provinces of Thailand by the year 2000.5.2 KSC House Call. Technician to provide installation and training at customer’s home and office.
5. Future Prospects of KSC (continued)
5.3 KSC to Become a Phone Company
when Thailand telecommunications
deregulated.5.4 Complete Ecommerce Services.
(KrungThai - KSC Ecommerce)
5.5 KSC Free Email for Million Users.
5.6 KSC Free Education-on-Demand.
5. Future Prospect of KSC(continued)
5.7 KSC Own Telecommunications Network.
5.8 KSC High-Speed Internet Connection.
5.9 Hard-to-Refuse Offer to Educational
Institutions.
5.10 Grooming Kids to Become Customers.
KSC Projected Profits in 2006Worst : 7 M US$ Best : 40 M US$
67 13194
0.9
257
38 50
183
10.6 30.9 306.80.9 10.6
418
703
1,019
72136
243
6.8 30.9 36
1,478
0
200
400
600
800
1000
1200
1400
1600
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Year
Profi
t befo
re T
ax in
million ba
ht
Worst Case
Best Case
6. Concluding Remarks
• KSC is the first
and largest ISP in Thailand.
• KSC will remain the largest ISP in Thailand.
6. Concluding Remarks
With
• Proven Track Record of Profit from Day One,
• Capable Management,
• Dedicated Manpower Resource,
• Excellent Business Models, and
• Promising Prospects,
KSC is now ready and willing to negotiate with potential strategic and/or financial investors for mutual benefits.