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This report provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in Malaysia. Subjects covered include:
Market and Industry Overviews;
Regulatory Environment and Development;
Major Telecom Players (mobile, fixed);
Mobile Voice and Data Market;
Internet, including VoIP and IPTV;
Broadband (fixed, wireless, mobile);
Scenario Forecasts (fixed-line, mobile, broadband subscribers).
Malaysia achieving large scale access to broadband as household penetration nears 70%
There has been strong growth in Malaysia’s telecom sector over the last decade, but the growth has not been consistent across the sector. The number of fixed-line services, after growing rapidly at first, had been relatively static for around ten years; then we saw clear evidence of a shrinking subscriber base. The mobile market by contrast has been more spectacular, racing to around 45 million subscribers by early 2014, a penetration approaching 150%; this was up from just 6 million mobile subscribers in 2000. After starting off slowly, broadband internet has been expanding strongly in recent years and by early 2014 had reached a remarkable 67% household penetration.
Over the last two decades Malaysia has been working towards a clear national objective to see it ranked as a fully developed nation by the year 2020. This Vision 2020 was a concept introduced by the former Prime Minister Mr Mahathir in 1991 when he launched the Sixth Malaysia Plan. The task of building an advanced telecom sector has been regarded as central to achieving this national objective. It has also been a matter of national pride. For a period in the 1990s the country was busy promoting itself as a regional high technology hub. In recent times, however, it has adopted a quieter profile and simply gone about the task of putting what might be described as a technologically progressive economy in place. With the widespread application of modern technologies such as fibre optics, wireless transmission, digitalisation and satellite services, Malaysia has been steadily moving towards achieving its national goals.
The generally strong growth across the country’s telecom sector inevitably brought with it considerable investment interest and activity. The telecommunication sector in Malaysia has seen a general opening up and expansion of the market with a significant number of new licences being granted. While still in ongoing expansion mode Malaysia’s telecom sector has undergone some important restructuring. This has involved the regulator progressively introducing reforms. In the meantime, the telecom companies have been doing battle in an increasingly competitive and changing market. The last decade or so has seen healthy overall growth in Malaysia’s telecom sector. At the same time, substantial government participation in Information & Communications Technology (ICT) development has also been a particular characteristic of the Malaysian market.
The developmental effort in the telecom sector has been led by a booming mobile market, although subscriber growth has slowed somewhat. More recently, a major move by the operators into mobile broadband has seen vigorous growth in the market, with strengthening ARPUs. The momentum surrounding mobile broadband was set to continue with the issue of multiple 4G/LTE licences in late 2012 and the launch of a series of advanced mobile broadband networks in 2013.
The fixed-line market by contrast has moved along a much more subdued path. The number of fixed-line subscribers having peaked in 2010, the market has gone into a steady decline. There were no real signs that the fixed-line market was going to pick up again, this despite the government still having some rather ambitious targets in place. The national fixed-line network nevertheless remains an important element in the building and ongoing operation of the country’s telecom infrastructure.
As already noted, the adoption of broadband internet has been the big news in Malaysia over the last few years. Finally the long awaited surge in internet demand has arrived, this happening after a period of slower than expected development. High speed broadband first started to take off in 2008; by early 2014 there were over six million broadband subscribers with around 60% of these being wireless-based. The arrival of wireless broadband overwhelmed a market previously dominated by Digital Subscriber Line (DSL) technology. Telekom Malaysia had been the dominant broadband service provider. Even this was being challenged as the market opened up and mobile broadband became more widespread. At the same time fibre-based broadband services have also started to impact the market.
The country’s broadband strategy was given a major boost when the government chose Telekom Malaysia to roll out a National Broadband Network (NBN). In what was referred to as the High-Speed Broadband (HSBB) project, Telekom Malaysia (TM) has been busy building a fibre-based open system. In late 2013, as part of its 2014 budget announcement, the government committed a further US$1 billion for the second phase of the HSBB project.
Data in this report is the latest available at the time of preparation and may not be for the current year