Snippets
Connectivity key to digital transformation
Focus Malaysia 16 May 2019 13:50
  • MCMC releases Industry Performance Report 2018 (IPR 2018), highlighting developments that have shaped the communications and multimedia (C&M) industry as it is today.
  • The C&M industry is worth RM135.7 billion in the local stock exchange.

World Telecommunication and Information Society Day (WTISD) aims to raise awareness of the possibilities that the use of the Internet and other information and communication technologies (ICT) can bring to societies and economies. This year, WTISD 2019 celebrates its 50th anniversary with the theme ‘bridging the standardization gap’.

In conjunction with WTISD 2019, the Malaysian Communications and Multimedia Commission (MCMC) releases the Industry Performance Report (IPR) 2018. As 2018 marks the 20th anniversary of the communications and multimedia (C&M) convergence regulatory framework in Malaysia, IPR 2018 highlights the developments that have shaped the industry as it is today.

In the current digital era, high speed Internet and reliable connectivity have become part of our daily necessities and can empower us to a better life.

The C&M industry is currently worth RM135.7 billion in the local Malaysian stock exchange, Bursa Malaysia. This is nearly three times growth from RM50.7 billion in 1999. C&M not only contribute towards creating a vibrant and competitive industry, but it will also help accelerate the growth and transformation of other sectors of the economy to create a connected, informed and empowered society.

In 2018, the C&M industry generated a revenue of RM51.6 billion, with the telecommunications sector as the highest contributor at 69% (RM35.9 billion). Broadcasting sector contributed 12% (RM6.4 billion), postal sector at 5% (RM2.4 billion) and remaining 14% (RM7 billion) from non-public listed licensees and others.

In 2017, the Capex of the telecommunications sector is RM6 billion in order to improve the network for better quality and coverage; while the Capex in 2018 is at RM5.21 billion. This is mainly due to 4G LTE buildouts and network already reaching national coverage of above 70%.

Connectivity is the driver for service provider revenue growth over the last 20 years. Milestones include substitution of fixed voice to mobile and recently, mobile broadband. Mobile broadband subscriptions in 2018 has increased to 36.8 million compared with 10,000 in 2005. This is after 3G service was launched and an extensive roll out of 4G LTE services since 2012 contributed to the surge in mobile broadband subscriptions.

In 2018, mobile cellular subscriptions has grown to 42.4 million from 5.1 million in 2000, while DEL (Direct Exchange Line) dropped to 2.6 million subscriptions from 4.6 million in 2000.

Factors driving higher mobile broadband subscriptions include mobility and better livelihood; including video viewing, online shopping, online banking, and communications through WhatsApp video calls.

Thus, all stakeholders are committed in ensuring that people at all levels can enjoy high speed broadband at a reasonable price. In light of this, regulatory and policy tools have been implemented to provide high speed and quality broadband services at affordable prices to the people.

The Mandatory Standard on Access Pricing (MSAP) implemented in 2018 serves to regulate the wholesale prices for high speed broadband services. This new price regulation has enabled service providers to acquire high speed broadband services at more attractive prices, which enabled this cost saving to be passed down to consumers.

The implementation resulted in an almost immediate price reduction of more than 30% for entry-level high speed broadband packages in December 2018. Concurrently, some service providers have offered higher speeds at the same price.

In Budget 2019, the government has announced the National Fiberisation and Connectivity Plan (NFCP). The NFCP project, which combines the use of optical fibre and wireless connectivity, targets the achievement of 98% baseline coverage in inhabited areas by 2023 with an average bandwidth of 30 Mbps. NFCP will ensure people enjoy quality broadband experience and narrow the digital divide between Peninsular Malaysia, Sabah and Sarawak as well as urban and rural areas.

MCMC Chairman, Al-Ishsal Ishak emphasises that close collaborations among stakeholders are required to accelerate connectivity.

He said, “For 2019 and over the next few years, service providers have expressed commitment to increase Capex for growth and offer new digital services”.

“Going forward, with Artificial Intelligence and big data analytics, service providers can optimise their resources for more personalisation. This provides the pathway for further monetisation of service provider network assets from Business-to-Business (B2B) and Business-to-Consumer (B2C).”

With affordable prices and reliable connectivity, everyone can leverage on opportunities arising and are empowered to benefit and grow our digital economy.

The Industry Performance Report 2018 is now available at https://www.mcmc.gov.my/skmmgovmy/media/General/pdf/Industry-Performance-Report-2018.pdf.



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