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The changing landscape of telecommunication services in Malaysia

In 1994, the Malaysian Government introduced the National Telecommunication Policy of Malaysia (Policy) with the purpose of setting out the direction for the telecommunications industry between 1994 and 2020 and ensuring that the growth of telecommunications services and its use of technology support national development and are consistent with national objectives and aspirations. Strategies laid out to achieve the objectives of the Policy include the following:-

  • Expansion of services in a systematic and comprehensive manner;
  • Development of a strategic and export-oriented manufacturing industry;
  • Encouraging competitiveness;
  • Research and development to enhance the application of technology;
  • Development of a dynamic and innovative human resource;
  • Upgrading rural telecommunication facilities;
  • Encouraging active Bumiputera participation; and
  • International strategic interaction.

With the approach then taken, new legislation came into force, namely the Communications and Multimedia Act 1998 (CMA), which provides for and regulates the converging communications and multimedia industries, and the Malaysian Communication and Multimedia Commission Act 1998 (MCMCA), which provides for the establishment of the Malaysian Communications and Multimedia Commission (MCMC). This regulatory body is empowered to plan and formulate national policies for the communication and multimedia industry and act as the regulatory and licensing body for the industry in Malaysia.

One of the MCMC's main roles is to act as a licensing body for all communications services and activities falling under their purview. The four categories of licensable activities under the CMA are:

(i) Network Facilities Provider (NFP) Licence: for the provision of network facilities or physical infrastructure for or in connection with the provision of network services, for example, satellite earth stations, fixed links and cables, public payphone facilities, radio communications transmitters and links, satellite hubs, and towers, poles, ducts and pits used in conjunction with other network facilities.

(ii) Network Service Provider (NSP) Licence: for the provision of network services for basic connectivity and bandwidth to support a variety of applications e.g. bandwidth services, broadcasting distribution services; switching services; gateway services; access applications service; space services and cellular mobile services.

(iii) Applications Service Provider (ASP) Licence: Defined in the CMA as a person who provides a service provided by means of, but not solely by means of, one or more network services. The ASP licence is generally for the provision of audiotext hosting services provided on an opt-in basis, directory services, Internet access services, messaging services, private payphone services and telegram services.

(iv) Content Applications Service Provider (CASP) Licence: for the provision of application services which provide content, such as satellite broadcasting subscription, broadcasting, terrestrial free to air TV and terrestrial radio broadcasting. The CASP class licence also encompasses content applications service limited in its availability to vehicles, vessels, railway or aircraft.

Due to the ever-evolving nature of the industry, the MCMC has published licensing criteria to be used as a guide on the licensing regime as well as an exemption order that sets out certain exempted activities for each category of licence.

Snippets of New Developments

The Malaysian communications and multimedia industry is developing rapidly at an exponential growth rate in recent years. Recent developments in the Malaysian communications and multimedia industry include the introduction of the Digital Terrestrial Television (DTT) services and the Internet of Things (IoT). With the DTTB, broadcasters in Malaysia will move from the current analogue platforms into a fully digital platform that will allow broadcasters to provide more television and radio channels with better image quality but at a lower cost.

In order to ensure proper DTT service rollout, MCMC has published mandatory standards and technical codes such as, among other things, the Commission Determination on the Mandatory Standard for Free to Air Transmission of Digital Terrestrial Television Service and the Specification for Digital Terrestrial Television Broadcast Service Receiver. The migration of most services in communications and multimedia from analogue to digital will be game-changing and we anticipate further legislation and policy being developed in the near future.

Whilst Malaysians move towards a more integrated and connected lifestyle, the mood is such that the high tech industries are now focusing on the interconnection of things and people. Smart devices have permeated almost every aspect of the workplace and the home and is so integral to us that the next question is now "Can they all be connected?". The concept of IoT is now being mooted and the MCMC is entrusted to oversee the IoT. The IoT manages tasks autonomously and is a web in which gadgets, machines, everyday products, devices and inanimate objects share information about themselves in new ways and in real time. The development of the National IoT Blueprint is now in progress and according to the national research and development centre, MIMOS Bhd, the National IoT Blueprint will "set the strategic direction for the establishment of a synergized innovation ecosystem that can create sustainable streams of IoT innovations".

Related to the IoT is the Digital Lifestyle Malaysia (DLM), an initiative undertaken by the MCMC to encourage the development and acceptance of applications and services. DLM includes the acceptance of IoT infrastructures to embrace the digital lifestyle that could elevate the quality of life to a better level and to attain global recognition. The six digital lifestyle ecosystems proposed by the MCMC are transport, agriculture, district, entertainment, learning and work. The objective of DLM is to enable Malaysians to compete internationally by increasing productivity and sustainability through adoption of intelligent ICT services and IoT applications while the outcome is to make Malaysia a high income nation by 2020 using broadband network and ICT services. DLM envisages the creation of a better quality of life especially in the rural community by means of ICT. The MCMC's priority to ensure that DLM contributes towards the economic growth is to determine key economically value added growth areas, which will be the foundation for strengthening the Digital Lifestyle ecosystems.

Another government initiative is the development of Big Data Analytics (BDA). The MCMC together with the Malaysian Administrative Modernisation and Management Planning Unit (MAMPU) and the Multimedia Development Corporation (MDeC) are working hand in hand in developing Big Data Analytics (BDA), which will allow organizations to analyse large sets of data to discover the unknown patterns, market trends and other useful information. It is reported by MAMPU that the purpose of BDA is to increase the ability of the government in making decisions based on facts and data and develop business opportunities. According to Datuk Yasmin Mahmood, chief executive officer at MDeC, BDA is one of the main pillars for national ICT development under the 11th Malaysia Plan. MDeC has taken the effort to execute BDA projects under the 11th Malaysia Plan, some of which include the setting up of an Asian Data Science Institute, developing open government data and establishing a network of BDA Innovation Centres of Excellence.

All these proposed changes are still in their embryo stage and it remains to be seen how each of these initiatives will play out in Malaysia as their success will depend on many factors. Malaysians may however look forward to the years ahead as the government is seen to be encouraging all new developments and ideas in the high-tech industries.