Will YTL Comms sue Education Ministry over termination of 1BestariNet?

School children

YTL Communications Sdn Bhd says the government breached its contractual obligations and had not acted in good faith when it terminated the 1BestariNet and Frog Virtual Learning Environment (Frog VLE) services offered by the telco to over 10,000 schools nationwide.

In a strongly worded statement this afternoon, YTL Communications said while the government had terminated the 15-year deal, the company remains committed to serving the nation and believes it has a continued role to play in the sector.

“YTL Communications has invested more than RM4 billion building the infrastructure in the school for a 15-year project. It was our legitimate expectation that we would be given an extension of the contract into the next phase,” the statement read.

“We view the (Education) ministry’s actions as being in breach of their contractual obligation to us

“Disappointingly, they (ministry) have not acted in good faith in respect of what we have been informed and what has actually been implemented.”

The statement by the company this afternoon comes barely two days after its managing director Datuk Yeoh Seok Hong and FrogAsia Sdn Bhd executive director Lou Yeoh told Twentytwo13 that its 1BestariNet Receiver Integrated System (1BRIS) towers will remain in schools nationwide despite the Education Ministry securing the services of three new Internet service providers for the next six months.

The statement, however, stops short of indicating if the telecommunications company will take legal action against the ministry.

The Terengganu, Kedah, Perlis and Penang state education departments had issued supporting letters between April and June this year, hailing 1BestariNet and Frog VLE, with some stating “it would be a waste” if the project is discontinued. YTL Communications had attached copies of the letters along with its statement.

The existence of the supporting letter raises questions if the ministry had considered the views and feedback from these departments before deciding to end the programme.

1BestariNet is powered by Yes 4G while Frog VLE is a learning platform where teachers create and post content that students can access.

Frog VLE is used in 23 countries including UK, US, Hong Kong, Middle East and Australia. Last year, FrogAsia won a tender by the South Australian Government to implement the learning platform in all 900 school in South Australia modelled after Malaysia.

On June 27, Education Minister Maszlee Malik announced that the ministry would be terminating YTL Communications’ 1BestariNet Internet services to 10,211 schools. Following the termination, Internet services will be powered by Telekom Malaysia, Celcom Axiata and Maxis Broadband for six months (July 1 – Dec 31, 2019) before the ministry selects a new Internet service provider starting Jan 1, 2020.

During the interim, teachers and students will also migrate to the Google Classroom learning system.

YTL Communications said today it was surprised by the move to award the three other telecommunication companies to replace YTL Communications as interim Internet service providers to schools for the second half of 2019.

“When the ministry announced on June 27 that it had awarded the interim services to Telekom Malaysia, Celcom Axiata and Maxis, it came as a complete surprise.

“The ministry had excluded YTL Communications, reneged on its statement to call an open tender and agreed to pay for the Internet services to the three appointed ISPs (Internet service providers) although we had offered the services for free.

The company claimed:

  • The Education Ministry had in July last year announced that it would be calling for a fresh tender early 2019 to continue providing Internet connectivity to around 10,000 schools (which was being provided by YTL Communications).
  • YTL Communications made repeated inquiries to the ministry on the status of the tender and on April 23 this year, the ministry invited them together with Telekom Malaysia, Celcom Axiata, Maxis and a few other Internet service providers to a meeting. The government informed them the ministry was “not ready for a tender implementation on July 1 when phase two of the contract with YTL Communications would expire.
  • The meeting was informed there would be a delay of six more months during which the participating schools would continue to require interim Internet services.
  • The ministry requested that YTL Communications provide free Internet services as the government did not have the budget for these services.

“As responsible corporate citizens and not seeking to disrupt Internet services to the schools, YTL Communications wrote to Maszlee on May 31 confirming we would provide a complete solution of free Internet services as well as Frog VLE for the interim period until the tender was called and awarded.

“Our primary concern was to ensure teaching in schools was not disrupted in the middle of the school year. Unfortunately, we did not receive any response to our offer,” the statement read.

The government’s 15-year service contract with YTL Communications was awarded through an open tender in 2011 and was to be implemented in phases. The scope of work included providing a total learning solution comprising Internet connectivity, security and Frog VLE.

The company revealed the contract required a review after each phase before reaching agreement on the next phase.

The 15-year programme, valued at RM4.1 billion and divided into several phases, was launched by then Education Minister Tan Sri Muhyiddin Yassin.

Over the years, the project had come under the scrutiny of the Public Accounts Committee (PAC). On March 17, 2015, then PAC chairman Datuk Nur Jazlan Mohamed suggested the project be scrapped, adding it did not yield the expected results although RM633 million was spent on the first phase.

Nur Jazlan, however, said it was up to the Education Ministry to decide on the fate of the project.

YTL Communications also said it was assured that it would not be excluded from the tender process during the meeting with the ministry last July.

“Having successfully completed phases one and two, phase three would have seen the full adoption of digital teaching and learning in classrooms by January 2020,” the company said.

“Changing the platform and starting all over again will set the entire education system backwards by years.”

YTL Communications also claimed it had received numerous enquiries from teachers asking if they would still be able to access FROG VLE following the announcement to terminate 1Bestarinet and introduce Google Classroom.

The company also refuted a posting by “Friends of Maszlee Malik” regarding seven reasons why 1 Bestarinet should be terminated. The posting appeared on a newly created website, a day after Maszlee announced the termination of the contract with YTL Communications.

“The website, obviously intended to give an “official spin” by using the honourable minister’s name, and made allegations that are false and slanderous.

“We categorically state that YTL Communications has fulfilled all service level agreements under its contract and has not received any complaints from the ministry.

“We would have fully expected the minister to refute these allegations and dissociate himself from this post that bears his name, image and the name of the ministry,” the statement stated.