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Market Definition Analysis Definition of Communications Market in Malaysia

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Market Definition Analysis Definition of Communications Market in Malaysia Malaysian Communications and Multimedia Commission Market Definition Analysis Definition of Communications Market in Malaysia 24 September 2014 This document contains the final views on MCMC’s market definition. The information in this document is intended as a guide only. For this reason it should not be relied on as legal advice or regarded as a substitute for legal advice in individual cases. The information contained in this document may be subjected to changes without notice. Malaysian Communications and Multimedia Commission Off Persiaran Multimedia, 63000 Cyberjaya, Selangor Darul Ehsan. Tel: +60 3 86 88 80 00 Fax: +60 3 86 88 10 00 www.skmm.gov.my Contents Part A Background, objective and approach 1 1 Background 1 2 Feedback 2 3 Analytical framework for determining economic markets as set out in the Dominance Guidelines 3 4 International approaches 7 5 Trends in the communications sector 9 6 Summary of findings 12 Part B Fixed services (Layers 1-2) 16 1 Introduction 16 2 Fixed telephony services (including VoIP) 16 3 Broadband and data 27 4 Inter-exchange transmission 34 5 Tail transmission 40 6 Domestic managed data services 45 7 International transmission and international managed data services 47 8 Broadcasting transmission 51 9 Other satellite services 55 Part C Mobility services (Layers 1-2) 57 1 Introduction 57 2 Mobile telephony 57 3 Mobile broadband and data 64 Part D Application services (Layers 3+) 71 1 Introduction 71 2 Messaging services 71 3 Directory services 75 4 Content services 77 5 Broadcasting services 89 6 Other applications services 93 Part E Interconnection services 94 1 Introduction 94 2 Termination (fixed and mobile) 94 Market definition analysis 3 Origination (fixed and mobile) 98 4 SMS termination 100 5 Inter-connect link 102 6 Transmission to submarine cable landing stations and earth stations 104 7 Wholesale Internet interconnection 106 Part F Access to facilities and upstream network elements (Layer 0) 110 1 Introduction 110 2 Access to lead-in ducts and manholes 111 3 Access to inter-exchange and mainline ducts 113 4 Access to towers 114 5 Access to co-location at exchange buildings 116 6 Access to submarine cable landing stations and earth stations 117 7 Access to full access (unbundling of local loop), sub-loop, line sharing and bitstream services 119 8 Access to dark fibre 121 9 Access to MDFs and in-building wiring 123 10 Access to common in-building mobile systems 124 11 Summary of markets for access to network facilities and UNEs 125 ii ABBREVIATIONS AND GLOSSARY ACCC Australian Competition and Consumer Commission ACMA Australian Communications and Media Authority ADSL Asymmetric Digital Subscriber Line ASEAN The Association of Southeast Asian Nations ASP Application Service Provider ATM Asynchronous Transfer Mode BEREC Body of European Regulators for Electronic Communications BT British Telecom CBD Central Business District CIIP Common Integrated Infrastructure Provider CMA Communications and Multimedia Act 1998 DEL Direct Exchanged Line DSL Digital Subscriber Line DSLAM Digital Subscriber Line Access Multiplexer DTCS Domestic Transmission Capacity Services DTT Digital Terrestrial Television DTTB Digital Terrestrial Television Broadcast EC European Commission EIC External Interconnection Cable EPL European Premiere League ESA Exchange Service Area F2M Fixed to Mobile FA Football Association FAD Final Access Determination FIFA International Federation of Football Association FTA Free to Air FTAS Fixed Terminating Access Service FTTB Fibre to the Business FTTH Fibre to the Home Gbit Giga Bit Per Second GPRS General Packet Radio Service GSM Global System for Mobile Communications HD High Definition HSBB High Speed Broadband Network HSPA High Speed Packet Access IDA Info-Communications Development Authority of Singapore iii IEEE Institute of Electrical and Electronic Engineers IMT International Mobile Telecommunications IPLC International Private Leased Circuit IPTV Internet Protocol Television IPVPN Internet Protocol Virtual Private Network ISDN Integrated Services Digital Network ITS International Telephone Services ITU International Telecommunications Union IXP Internet Exchange Point Kbps Kilo Bit Per Second LLC Local Leased Circuit LMDS Local Multipoint Distribution Services LSS Line Sharing Service LTE Long Term Evolution Mbps Mega Bit Per Second MCMC Malaysian Communications and Multimedia Commission MDA Media Development Authority of Singapore MDF Main Distribution Frame METRO-E Metro Ethernet MMS Multimedia Messaging Service MNO Mobile Network Operator MTAS Mobile Terminating Access Service MVNO Mobile Virtual Network Operator MyIX Malaysian Internet Exchange NBA National Basketball Association NBN National Broadband Network NRA National Regulatory Authority OFCOM The Office of Communications of UK OPTA The Independent Post and Telecommunications Authority of Netherlands OSI Open Systems Interconnection OTT Over-the-Top PDH Plesiochronous Digital Hierarchy POI Point of Interconnection POP Point of Presence PSSB Puncak Semangat Sendirian Berhad PSTN Public Switched Telephone Network PTS Postal Telecommunications Authority of Sweden RTR Austrian Regulatory Authority for Broadcasting and Telecommunications iv SD Standard Definition SDH Synchronous Digital Hierarchy SDSL Symmetric Digital Subscriber Line SEA South East Asia SKA Sender Keeps All SME Small and Medium Enterprise SMS Short Messaging Services SSNIP Small but significant non-transitory increase in price SUKMA Sukan Malaysia TRA Telecommunications Regulatory Authorities TVRO Television Received Only UHF Ultra High Frequency ULL Unbundling of local loop UMTS Universal Mobile Telecommunications System UNE Upstream Network Element VDSL Very High Bit Rate Digital Subscriber Line VHF Very High Frequency VOD Video on Demand VOIP Voice Over Internet Protocol VPN Virtual Private Network VSAT Very Small Aperture Terminal WIMAX Worldwide Interoperability for Microwave Access WLR Wholesale Line Rental 3G Third Generation 4G Fourth Generation v Part A Background, objective and approach 1 Background 1.1 The Malaysian Communications and Multimedia Commission ( MCMC ) has conducting a study on the assessment of dominance in the communications market and has published a Public Inquiry Report on the Assessment of Dominance in a Communications Market dated 24 September 2014. 1.2 In 2003, the MCMC undertook a dominance study which resulted in the publication of a public inquiry report on 8 December 2004 ( 2004 Dominance Study ). This study was followed by a Commission Determination on Dominant Position in Communications Market (Determination ) under section 137 of the Communications and Multimedia Act 1998 (CMA ), in which a number of licensees were found to be dominant in specified communications market. The Determination was valid for a period of two years and has since lapsed. 1.3 Since the 2004 Dominance Study, the communications sector in Malaysia has experienced (and continues to experience) significant technological and product innovation. In the broadcasting sector, this has included the movement from linear to on-demand supply, the emergence of new cable operators, an increase in intermodal competition (for example IPTV versus traditional media platforms) and a planned migration from analogue to digital broadcasting scheduled to begin in 2015. In the telecommunications sector this has included the allocation of spectrum bands to support 4G technologies, the emergence of OTT services and the introduction of triple- play bundles. 1.4 The MCMC has determined that it is timely to conduct another dominance study that addresses changes in the communications market (Dominance Study ). Central to the MCMC’s Dominance Study is the definition of what constitutes a ‘communications market’, which is the purpose of this Market Definition Analysis. 1.5 Work on the Dominance Study and this Market Definition Analysis commenced in November 2013. The first phase of the project involved gathering data and information on the Malaysian communications sector and key participants. For this purpose, a questionnaire was sent to all major licensees. 1.6 Following the issuing of the questionnaire, the MCMC met with licensees in November 2013. The purpose of these meetings was to introduce the Dominance Study and this Market Definition Analysis to licensees and discuss any questions from licensees arising from the questionnaire. The MCMC had posed a series of questions in the Market Definition Analysis document dated 7 April 2014 in relation to each proposed market. Feedback that has been received to those questions were used to verify and improve the accuracy of the MCMC’s proposed market definitions. Market definition analysis 1 1.7 Any information that was provided to the MCMC on a confidential basis and which the MCMC is satisfied is not otherwise available from public sources has been redacted and marked with the reference “c-i-c” (i.e. commercial- in-confidence). This information has been used by the MCMC in formulating its views, but not disclosed due to confidentiality restrictions. 1.8 Lastly, it should be noted that it is often difficult to define the boundaries of a relevant market with precision. While the analytical tools for defining markets discussed below provide a useful framework for defining markets, generally the process of defining the market involves value judgments and a balancing of the available evidence. 2 Feedback 2.1 This Market Definition Analysis sets out the MCMC’s proposed market definitions for a range of communications-related
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