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Industry Performance Report 2007

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Industry Performance Report 2007 Industry Performance Report 2007 Collaboration Towards Enhancing National Competitiveness Suruhanjaya Komunikasi dan Multimedia Malaysia Malaysian Communications and Multimedia Commission Industry Performance Report ABOUT THE COVER 2007 The game of Sepak Takraw as depicted on the cover evolved from an ancient local traditional Collaboration Towards Enhancing National Competitiveness game of sepak raga. The game is believed played in the countries of South-east Asia. In its original form, the game was played individually by several persons forming a circle and the idea was to keep the raga or a ball that is woven from rattan from touching the ground as long as possible. For hundreds of years, the way the game was played remained very much the same. However, it underwent significant change in 1935 when the net version of Sepak Takraw was first played, in the state of Negeri Sembilan, during the Silver Jubilee celebration of King George V. From then on the game steadily emerged as a competitive game played internationally and in major sporting events. The story of Sepak Takraw is one that highlights the importance of team spirit and togetherness. Either in its original or current form, Sepak Takraw depicts players getting together to compete either as a team or individually. Taking the spirit of this national sport to the theme for the cover of this report symbolises the “Collaboration towards Enhancing National Competitiveness.” © Malaysian Communications and Multimedia Commission 2008 The information or material in this publication is protected under copyright and, save where otherwise stated, may be reproduced for non- commercial use provided it is reproduced accurately and not used in a misleading context. Where any material is reproduced, MCMC as the source of the material must be identified and the copyright status acknowledged. The permission to reproduce does not extend to any information or material the copyright of which belongs to any other person, organisation or third party. Authorisation or permission to reproduce such information or material must be obtained from the copyright holders concerned. Malaysian Communications and Multimedia Commission 63000 Cyberjaya, Selangor Darul Ehsan, Malaysia. Tel: +603-8688 8000 Fax: +603-8688 1000 Toll Free Numbers: 1-800-888-030 http://www.mcmc.gov.my Concept, design and layout by: Versa Ads Sdn Bhd (498793-D) Content Message from the Chairman 5 CHAPTER 1 Executive Summary 7 CHAPTER 2 Economic Performance of the Industry 11 Malaysian GDP 6.3% at 2007 11 Contribution of C&M Companies to Bursa Malaysia 12 C&M Industry Revenue Overview 13 Telecommunications Sector 14 Broadcasting Sector 17 Postal Services Sector 19 Digital Signature Revenue 20 MESDAQ Market – An Overview of SKMM Licensees 22 Holding Company of SKMM Licensees on MESDAQ – Market Listing and Financials 23 SKMM Licensees Listed on MESDAQ 24 SKMM Licensees Business Activities 24 Malaysian Adex 2007 25 Adex: General Observations 25 CHAPTER 3 C&M Industry Overview 29 Regulatory Regime in Malaysia C&M Industry 29 Licensing in 2007 29 Development of the C&M Industry 30 Communications and Multimedia Industry – 6% of GDP 30 C&M Revenue by Services Market Segment 32 Fixed Line Services Segment 33 Cellular Mobile Services Segment 33 Broadcasting-Subscription TV Segment 34 Free-To-Air TV Segment 35 Postal Services Segment 36 Other Segments 36 C&M Capex Trend 37 MyICMS 886 39 MSC Malaysia 47 CHAPTER 4 Fixed Line Services 51 Fixed Line Connections 51 Narrowband - Internet Dial-Up Service 52 Broadband – Wireline and Wireless 55 Broadband Penetration in Malaysia 55 Regional Comparatives 56 Malaysia Broadband Initiatives 57 Wireless Fidelity (Wi-Fi) Hotspots 58 Worldwide Interoperability for Microwave Access (WiMAX) 59 Broadband Packages from Mobile Operators 61 VoIP Service and Packages 61 1 Content CHAPTER 5 Mobile Services 63 Cellular Mobile Phone Connections 63 Trends in Mobile Take-up 63 Prepaid and Post-paid Growth 64 Cellular Phone Connections and Market Share 65 Cellular Mobile Phone Development 66 Malaysia Mobile Going Forward 67 Mobile Number Portability (MNP) 67 Part of the National Policy Objectives 67 Timing for MNP 68 The Process from Regulatory Perspective 68 Industry Engagement 69 MNP Implementation Status 69 Nationwide Mobile Coverage 70 Projects Time 1 and Time 2 – Progress 70 Project Time 2 Expansion 71 Recognition for Time 2 Project 71 Newspaper Advertisements to Seek Feedback 72 Way Forward 73 CHAPTER 6 Broadcast Services 75 Development of Broadcast in Malaysia 75 Free-To-Air Television (FTA TV) 75 Satellite Pay-TV 75 High Definition TV 75 Alternative Platforms for TV 75 FTA TV Revenue 76 Radio Development 77 Radio Revenue 78 Initiatives for Content Development 80 Direct-To-Home (DTH) Satellite Pay-TV 80 DTH Developments 81 CHAPTER 7 Postal Services 83 Postal Services 83 Philately 84 Direct Mail 85 New Products in Postal - Hybrid Mail 87 Logistics Services 88 Modernisation of Pos Malaysia Services 89 CHAPTER 8 Courier Services 91 Courier Business is Highly Competitive 91 2 Content CHAPTER 9 Digital Signature 95 Digital Signature and SKMM 95 Components of Digital Signature 95 SKMM as the Regulator 96 Functions of Certification Authorities (CA) 96 Digital Signatures by Type 97 The Issues Ahead 98 CHAPTER 10 Consumer Protection 101 Quality of Service Mandatory Standard (QoS MS) 101 Review of QoS MS 101 Required Application Service (RAS) 102 Rates Monitoring 103 Communications and Multimedia Act, 1998 103 Communications and Multimedia (Rates) Rules 2002 103 Consumer Complaints Received by SKMM 103 Content Regulation: Overview of Complaints Received 105 Enforcement 106 Industry Self-regulation: Industry Forums 107 Communications and Multimedia Consumer Forum of Malaysia (CfM) 110 Malaysian Access Forum Berhad (MAFB) 110 The Malaysian Technical Standards Forum (MTSFB) 111 CHAPTER 11 Universal Service Provision 113 USP Projects in Bridging Digital Divide 113 Broadband Libraries 113 USP Communications Centre 114 USP Phases 2 and 3 115 Communications Towers along East West Highway 117 Other Activities 118 USP Review 118 Public Awareness Programme 119 Performance Assessment of USP Service Providers 119 Central Monitoring System 120 USP Fund Management System 121 Impact of USP Programme 121 CHAPTER 12 Going Forward – An Outlook 123 Appendices 127 List of Figures 143 Contact Us 146 3 PICTURE Message From The Chairman It is my pleasure to present to our readers the Industry Performance Report for the year 2007. The Malaysian Communications and Multimedia Commission (SKMM) publishes the Industry Performance Report on an annual basis as stipulated under Chapter 15, Part V of the Communications and Multimedia Act, 1998 (CMA). For the last six years, reporting has been skewed more to regulatory developments, including highlights of the changes in the industry since the migration of licensees in 1999/2000 to the current licence structure under the CMA. The report also includes developments under the Postal Services Act, 1991 and the Digital Signature Act, 1997 of which SKMM plays the role of regulator as well. In the Industry Performance Report 2007, the report is towards industry developments, with the regulatory areas reported as necessary, so that the trends in the communications and multimedia (C&M) industry can be viewed more clearly over the last ten years since the introduction of the CMA. The theme for this seventh Industry Performance Report is “Collaboration Towards Enhancing National Competitiveness”. Indeed, this theme can be said to be in the minds of operators and all stakeholders in the C&M industry as the traditional boundaries of business are blurring; heralding the entry of new entrants, products and services, and of course the opportunities that abound for existing players upon advancement of technologies that caters for cross sector competencies to promote successful business ventures. The C&M industry in our case includes the telecommunications, broadcasting, postal services as well as the relatively new market in digital signatures. The telecommunications sector continues to evolve and grow from strength to strength over the years despite challenges faced such as consolidation and strong competition. Regulatory developments such as the prepaid registration in 2006 and the implementation of mobile number portability together with the rollout of WiMAX services and the services of two other 3G service providers are expected to promote change and challenges in the Malaysian communications environment in 2008. These are natural developments evolving towards a more converged C&M industry in terms of network, services and applications. In such a scenario, competition and access issues are common and recurring phenomena that require efforts from all stakeholders and the regulator, including other relevant authorities in sorting the issues arising. This thereby, moves the industry forward to realise the national aspirations of a nation that is internationally competitive, with sustained economic growth and desired socio-economic development towards a developed nation status in the targeted year of 2020. The SKMM welcomes any comments, enquiries, suggestions and feedback on the information presented in the Industry Performance Report 2007. SKMM contact information is available on the last page of this report. Datuk Dr. Halim Shafie 5 PICTURE Chapter 1 Executive Summary The Malaysia economy continues to lend support to the growth of the communications and multimedia (C&M) industry, albeit in steady growth of 6.3%
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