Sign in or 
Share this
Malaysia: Mobile Landscape
If you are looking for information on the social media applications pertaining to mobile phones in Malaysia, go to Malaysia: Commercial and Social Mobile Applications.
Almost 84% of the 26 million people in Malaysia had a mobile telephone service by March 2007. This meant Malaysia had the second highest mobile penetration in South East Asia after Singapore.
Malaysia’s mobile market has made a remarkable recovery after suffering a serious setback.
Because some of the figures mentioned here are in MYR (Malaysian Ringgit), to have a consistent overview amongst the data and other countries, the currency exchange rate to convert to USD as on 11th November, 2009 is as follows:
[© Malaysia - Mobile Communications - Market Overview, Paul Budde Communications]
With almost 75% of the population having mobile phones at the end of 2007, the strong growth in this sector was expected to continue. The government expected mobile penetration to rise to 85% by 2010. Confounding all expectations of growth, the market reached over 80% penetration during 2006, earlier than most analysts and the government had expected. The sector had, however, been beset by service performance difficulties, such as poor reception. The high level of the problems reported by Malaysia’s mobile users prompted the Malaysian Communications & Multimedia Commission (MCMC) to insist that all mobile operators submit a performance report once a quarter. The government has put it on record that if it was found that a mobile operator’s network was not able to properly handle its existing subscribers then it would not be allowed it to accept new customers.
The total mobile subscriber base grew by about 26% in 2004 to reach 14.6 million by year-end, resulting in a penetration rate of close to 56%. Subscriber growth slowed slightly coming into 2005, but despite this, the market still grew at 25%; at the same time, consumers showed that they were eager to adopt mobile data services, SMS growing rapidly in the youth market. According to market reports, camera phones and Java-enabled mobile phones were popular, but General Packet Radio Service (GPRS) and Multimedia Messaging Service (MMS) usage was very difficult for most prepaid users and many revenue opportunities were being lost. This was setting the scene for the introduction of Third Generation (3G) services, which took place in a commercial form in 2005. By March 2007, the number of mobile subscribers had almost reached 21 million, including 456,000 3G subscribers. GSM became the dominant network type in the country with almost 100% of mobile subscribers being based on the GSM platform. Mobile data services are projected to grow at a compounded annual growth rate (CAGR) of 12.4% from RM5billion in 2008 to RM7.9bil in 2012.
Malaysians are very keen and on new technologies. To the younger generation having the latest communication technology is becoming a part of the cultural norm. The older generation is also embracing the use of internet and mobile telecommunications but only to the extent of emailing and making calls, while for the younger generation these are apart of their daily routines. The use of mobile phones extends from making calls and sending text messages to playing games, surfing the internet, as a daily planner and even an alarm clock.
Growth in mobile phone usage far exceeds that of fixed land lines in Malaysia. Maxis and Celcom launched 3G technology in 2005. There are a wide variety of 3G phones available in the market, but currently 3G technologies is appealing only to the higher - income group due to its relatively high cost. A trend for 3G is still yet to be identified.
It is relatively more expensive to call from a mobile phone line compared to a fixed line. Many mobile service providers offer competitive prices in order to promote usage of their mobile services. One prominent development is the wireless home mobile, where fixed line accounts are connected to wireless phone devices that can be carried around giving it more mobility..
Mobility is the main reason for the decline of landline services. Recognising the popularity of text messaging, Telecom Malaysia also introduced an sms service through fixed line phones but this was not well accepted by consumers.
[Major Operators] [Malaysia-Mobile Communocations: Market Overview, Paul Budde Communications]
[Malaysia-Mobile Communocations: Market Overview, Paul Budde Communications]
5.1 Local Network
The following factors are of note:
5.2 Mobile Telephone Networks
The country now has essentially three licensed mobile telephone network operators.
The following factors are of note:
6.1 Government Issues
Malaysia plans to become a knowledge based society by 2020, and the government is making strenuous efforts to achieve that objective. It appreciates that such a development requires a clear and effective regulatory regime but it is still uncertain about the nature of such a regime. The latest revision of how information and communications technology (ICT) should be regulated was made in 2004.The country faces a number of challenges. While the mobile services market is vibrant and still growing fairly quickly, the fixed line market remains virtually a monopoly. Broadband services are late developing, even in the urban areas, while rural areas often have no telecom service at all.
6.2 Relevant Government Authority
The Malaysian Comunications and Multimedia Commission (MCMC) was established to implement the provisions of the CMA. The powers and functions of the MCMC are:
The underlying principles of the regulatory regime under the MCMC take into account:
Now this policy has changed. In 2004, the new Prime Minister re-structured government and divided responsibilities for overseeing ICT between the Ministry of Science, Technology and Innovation (MSTI) and the Ministry of Energy, Water and Communications (MEWC). Broadly speaking, the MSTI is responsible for software and content issues, and it also oversees the MCMC. The MEWC is responsible for hardware and infrastructural matters.
Clearly, regulatory requirements differ from one country to another, and a regime that is suitable in one country may not be suitable elsewhere. Nevertheless, the move by the Malaysian government to diversify responsibility for ICT between two government departments goes against the trend in almost every other developed country.
6.3 Telecommunications Policy
The government’s national policy objectives for the communications and multimedia sector are
stated as follows:
By the late 1990s, the government had come to realise that its legislation needed to be updated to implement its policies and to take account of the convergence of the telecom, computing,multimedia and broadcasting industries. Consequently, it replaced the existing legislation with new laws designed to reflect this trend. Current relevant legislation includes:
6.5 Foreign Ownership
In January 1999, the government increased the share of local telecommunications companies that foreigners can own to 49% from 30%. In fact, it can be as high as 61%, provided that dilution back down to 49% is achieved within five years.
[(Q2 2007). Malaysia Telecommunications Report. London: Business Monitor International Ltd.]
 | In this section: 1. General Information 2. Mobile Phone Statistics and Forecasts 3. Consumer Behavior and Trends 4. Competitive Landscape 5. Network Infrastructure
8. Mobile Operator's Forecast |
| 1. General Information |
Almost 84% of the 26 million people in Malaysia had a mobile telephone service by March 2007. This meant Malaysia had the second highest mobile penetration in South East Asia after Singapore.
Malaysia’s mobile market has made a remarkable recovery after suffering a serious setback.
Because some of the figures mentioned here are in MYR (Malaysian Ringgit), to have a consistent overview amongst the data and other countries, the currency exchange rate to convert to USD as on 11th November, 2009 is as follows:
| Ringgit | USD |
| 1 | 0.294 |
| 2. Mobile Phone Statistics and Forecasts |
[© Malaysia - Mobile Communications - Market Overview, Paul Budde Communications]
With almost 75% of the population having mobile phones at the end of 2007, the strong growth in this sector was expected to continue. The government expected mobile penetration to rise to 85% by 2010. Confounding all expectations of growth, the market reached over 80% penetration during 2006, earlier than most analysts and the government had expected. The sector had, however, been beset by service performance difficulties, such as poor reception. The high level of the problems reported by Malaysia’s mobile users prompted the Malaysian Communications & Multimedia Commission (MCMC) to insist that all mobile operators submit a performance report once a quarter. The government has put it on record that if it was found that a mobile operator’s network was not able to properly handle its existing subscribers then it would not be allowed it to accept new customers.
The total mobile subscriber base grew by about 26% in 2004 to reach 14.6 million by year-end, resulting in a penetration rate of close to 56%. Subscriber growth slowed slightly coming into 2005, but despite this, the market still grew at 25%; at the same time, consumers showed that they were eager to adopt mobile data services, SMS growing rapidly in the youth market. According to market reports, camera phones and Java-enabled mobile phones were popular, but General Packet Radio Service (GPRS) and Multimedia Messaging Service (MMS) usage was very difficult for most prepaid users and many revenue opportunities were being lost. This was setting the scene for the introduction of Third Generation (3G) services, which took place in a commercial form in 2005. By March 2007, the number of mobile subscribers had almost reached 21 million, including 456,000 3G subscribers. GSM became the dominant network type in the country with almost 100% of mobile subscribers being based on the GSM platform. Mobile data services are projected to grow at a compounded annual growth rate (CAGR) of 12.4% from RM5billion in 2008 to RM7.9bil in 2012.
| 3. Consumer Behavior and Trends |
Malaysians are very keen and on new technologies. To the younger generation having the latest communication technology is becoming a part of the cultural norm. The older generation is also embracing the use of internet and mobile telecommunications but only to the extent of emailing and making calls, while for the younger generation these are apart of their daily routines. The use of mobile phones extends from making calls and sending text messages to playing games, surfing the internet, as a daily planner and even an alarm clock.
Growth in mobile phone usage far exceeds that of fixed land lines in Malaysia. Maxis and Celcom launched 3G technology in 2005. There are a wide variety of 3G phones available in the market, but currently 3G technologies is appealing only to the higher - income group due to its relatively high cost. A trend for 3G is still yet to be identified.
It is relatively more expensive to call from a mobile phone line compared to a fixed line. Many mobile service providers offer competitive prices in order to promote usage of their mobile services. One prominent development is the wireless home mobile, where fixed line accounts are connected to wireless phone devices that can be carried around giving it more mobility..
Mobility is the main reason for the decline of landline services. Recognising the popularity of text messaging, Telecom Malaysia also introduced an sms service through fixed line phones but this was not well accepted by consumers.
| 4. Competitive Landscape |
[Major Operators] [Malaysia-Mobile Communocations: Market Overview, Paul Budde Communications]
 | In 2002, the market comprised of five mobile operators: DiGicom, Maxis Communications and Time dotCom Bhd. Of the five, Maxis was the largest in terms of subscribers, just heading TRI Celcom, followed by Telekom and DiGi, with Time dotCom bringing up the rear. However, this was all set to change as the market went through a major rationalisation. It had been the view of the government for some time that the local telecom industry was not big enough to support five players, especially with the costly 3G technology on the horizon. Telekom Malaysia, which had been offering mobile services on three different platforms, had lost momentum in the mobile market. In an effort to regain this momentum and a greater market presence, Telekom decided to target TRI Celcom for acquisition. Completion of the merging of Telekom and Celcom in April 2003 was viewed as a positive move towards market consolidat ion. Celcom became a whollyowned subsidiary of Telekom and started operating under its independent management team following the merger. Celcom was responsible for the mobile operations and Telekom the fixed-line business. In a similar strategy, Maxis took steps towards securing its position in the mobile market when it moved to acquire one of its rivals, TimeCel. This was completed in May 2003 and integration of the two networks was set for completion by mid-2004. With the acquisition, Maxis was expected to be well positioned to maintain a leading role in the mobile industry, even allowing for the impact of the Telekom/Celcom merger. Thus, in a short period of time, Malaysia’s fast-consolidating mobile industry had seen the number of operators reduced from five to three, thanks to a combination of government prodding and the desire of the operators to remain competitive. In September 2003, Celcom noted that its merger with Telekom had helped it regain top market position, with a 42% share of a market worth RM10 billion (US$2.6 billion) in annual sales in 2002. The changing landscape of the Malaysian mobile market has witnessed the restructuring of the main players in that market. The government has been a strong supporter of the rationalisation of what had been seen as an overcrowded market. A particularly significant merger between Telekom and Celcom took place, creating a lot of interest. At the same time, but with less fanfare, Maxis acquired Time dotCom’s mobile unit. These changes have resulted in the number of operators being effectively reduced from five to three. The allocation of 3G licences has also been controversial with one of the operators missing out. | ||||||||||||||||||||||||||||||||||||
|
| 5. Network Infrastructure |
[Malaysia-Mobile Communocations: Market Overview, Paul Budde Communications]
5.1 Local Network
The following factors are of note:
- There are five operators with licences to provide local services, but Telekom Malaysia still controls some 97% of the local network
- The other operators have been trying to develop their local networks using such technologies as fibre optic cable and wireless local loop, but these initiatives are limited in scale
- An attempt to bring competition to the local loop through a scheme known a ‘Equal Access’ has largely failed
- It is expected that fibre optic cable will be available to all offices and homes by 2015
- Microwave links are in operation in the densely populated Klang Valley
5.2 Mobile Telephone Networks
The country now has essentially three licensed mobile telephone network operators.
The following factors are of note:
- Malaysia was one of the first countries in the region to introduce mobile phones
- Most of today’s networks use GSM technology
- The mobile sector is the most competitive in the industry
- The government has decreed that W-CDMA should be the standard technology used for 3G services
- 3G services began in May 2005
| 6. Regulatory Environment |
6.1 Government Issues
Malaysia plans to become a knowledge based society by 2020, and the government is making strenuous efforts to achieve that objective. It appreciates that such a development requires a clear and effective regulatory regime but it is still uncertain about the nature of such a regime. The latest revision of how information and communications technology (ICT) should be regulated was made in 2004.The country faces a number of challenges. While the mobile services market is vibrant and still growing fairly quickly, the fixed line market remains virtually a monopoly. Broadband services are late developing, even in the urban areas, while rural areas often have no telecom service at all.
6.2 Relevant Government Authority
The Malaysian Comunications and Multimedia Commission (MCMC) was established to implement the provisions of the CMA. The powers and functions of the MCMC are:
- To advise the Minister on all matters concerning the national policy objectives for communications and multimedia activities
- To implement and enforce the provisions of the communications and multimedia laws
- To regulate all matters relating to communications and multimedia activities not provided for in the communications and multimedia laws
- To consider and recommend reforms to the communications and multimedia laws
- To supervise and monitor communications and multimedia activities
- To encourage and promote the development of the communications and multimedia industry
- To encourage and promote self-regulation in the communications and multimedia industry
- To promote and maintain the integrity of all persons licensed or otherwise authorized under the communications and multimedia industry
- To render assistance in any form to, and to promote co-operation and co-ordination amongst, persons engaged in communications and multimedia activities
- To carry out any function under any written law as may be prescribed by the Minister with notification published in the Government Gazette
The underlying principles of the regulatory regime under the MCMC take into account:
One of the problems besetting regulation of the telecom industry in Malaysia is the changing position that the industry holds within the government’s structure. When the JTM was disbanded to be replaced by the MCMC in 1998, the policy was to bring all aspects of information and communication technology (ICT) under one organisation. The policy was adopted in recognition of the convergence of the various ICT components.
- Consumer interest - to promote and protect the interests of users
- Social responsibility - to benefit under-served groups / areas
- The industry should be responsible for its own development
- An ultimate goal of self regulation - with the industry itself recommending codes and standards
- Transparency - to ensure fairness for all market participants
- The need for technology-neutral decision making
- Incentive-based regulation - regulatory concessions and rights to be matched to undertakings
Now this policy has changed. In 2004, the new Prime Minister re-structured government and divided responsibilities for overseeing ICT between the Ministry of Science, Technology and Innovation (MSTI) and the Ministry of Energy, Water and Communications (MEWC). Broadly speaking, the MSTI is responsible for software and content issues, and it also oversees the MCMC. The MEWC is responsible for hardware and infrastructural matters.
Clearly, regulatory requirements differ from one country to another, and a regime that is suitable in one country may not be suitable elsewhere. Nevertheless, the move by the Malaysian government to diversify responsibility for ICT between two government departments goes against the trend in almost every other developed country.
6.3 Telecommunications Policy
The government’s national policy objectives for the communications and multimedia sector are
stated as follows:
- To establish Malaysia as a major global centre and hub for communications and Multimedia information and content services
- To promote a civil society where information based services will provide the basis of Continuing enhancements to quality of work and life
- To grow and nurture local information resources and cultural representation that
- Facilitates the national identity and global diversity
- To regulate for the long-term benefit of the end user
- To promote a high level of consumer confidence in service delivery from the industry
- To ensure an equitable provision of affordable services provided over a ubiquitous national infrastructure
- To create a robust applications environment for end users
- To facilitate the efficient allocation of resources such as skilled labour, capital, knowledge and national assets
- To promote the development of capabilities and skills within Malaysia’s convergence industries
- To ensure information security and network reliability and integrity
- The regulatory environment is intended to meet these policy objectives.
By the late 1990s, the government had come to realise that its legislation needed to be updated to implement its policies and to take account of the convergence of the telecom, computing,multimedia and broadcasting industries. Consequently, it replaced the existing legislation with new laws designed to reflect this trend. Current relevant legislation includes:
The Communications and Multimedia Act 1998
The Communications and Multimedia Act 1998 (CMA), which became effective on 1 April 1999, provides for and regulates the converging communications and IT industries. It supersedes the Telecommunications Act 1950 as well as the Broadcasting Act 1988.
The Malaysian Communications and Multimedia Commission Act 1998
The Malaysian Communications and Multimedia Commission Act 1998 (MCMCA), which became effective on 1 November 1998, provided for the establishment of the Malaysian Communications and Multimedia Commission, with powers to supervise and regulate communications and multimedia activities in Malaysia.
THE COMMUNICATIONS AND MULTIMEDIA ACT 1998
The telecom industry is now regulated according to the provisions of the Communications and Multimedia Act 1998 (CMA). The CMA’s objectives are:
- To promote national policy objectives
- To establish a licensing and regulatory framework for the communications and multimedia industry in support of these national policy objectives
- To establish the powers and functions of the MCMC
- To establish powers and procedures for the administration of the CMA
6.5 Foreign Ownership
In January 1999, the government increased the share of local telecommunications companies that foreigners can own to 49% from 30%. In fact, it can be as high as 61%, provided that dilution back down to 49% is achieved within five years.
| 7. SWOT Analysis |
[(Q2 2007). Malaysia Telecommunications Report. London: Business Monitor International Ltd.]
| Malaysia: SWOT Analysis | |
| Strengths 1. Liberal telecoms sector with well-established independent regulator and privatised incumbent operator 2. Sophisticated consumer profile eager to use mobile data and VAS 3. Government initiative to improve state of high-speed internet infrastructure | Weaknesses 1. Telekom Malaysia continues to exercise effective monopoly of domestic telephony and domestic/international leased line markets 2. Continued decline of fixed-line sector at hands of mobile, DSL and VoIP substitution 3. Little room for further growth in an overly competitive and increasingly saturated mobile market |
| Opportunities 1. 3G services providing numerous business opportunities for content providers and a new market for handset vendors 2. Broadband market set to experience huge growth, with BMI forecasting over 7mn subscribers by the end of 2011, up from just 500,000 in 2005 3. Award of WiMAX licences expected to push ahead mobile broadband market and bring with it real competition | Threats 1. Maturity of market could lead to a saturated domestic market, as in Singapore 2. Possibility that Malaysia could be displaced as a regional FDI hub by China, with vendors opting to locate/relocate to neighbouring countries 3. Lack of key strategic regional investors aside from Telenor, which recently lost out an important 3G tender |
| 8. Mobile Operators' Forecast |
Total wireless subscribers in Malaysia to reach 44.2 million in 2013 with ARPU levels declining across operators over the next five years. The Mobile Operator Forecast on Malaysia provides over 50 operational and financial metrics for the US wireless market and is one of the best forecasts in the industry. They provide five-year forecasts at the operator level going out to 2013. They also provide quarterly historical and forecast data starting in 1Q 2003 and ending in 1Q 2011. Operators covered for Malaysia include: Maxis Mobile Services Sdn. Bhd., Celcom (Malaysia) Berhad, and DiGi Telecommunications Sdn. Bhd. Their Mobile Operator Forecasts are updated quarterly and are available for one-time delivery or through regular updates. The Global Mobile Operator Forecast covers 50 operational metrics of 200+ mobile operators in 50+ countries, making up 80% of the world's population. Their forecasts are based on their proprietary, country-specific forecasting models. These models deploy multiple regression analysis and cross-impact matrices that estimate relationships between subscriber data, technology use and deployment data, overall economic and demographic changes expected in a particular country; and relate these to company operational and financial metrics. All of the three major operators will see their number of subscribers increase over the next five years. Our forecasting model predicts that the numbers of subscribers at Maxis, Celcom, DiGi will reach 20 million, 13 million, and 11 million, respectively in 2013.
1. “Market Watch 2008” IT and Telecommunications in Malaysia. Malaysian-German Chamber of Commerce. DE International, 2008. 27 May 2008 2. ELECTRONIC COMMERCE. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008 3. Malaysia - Internet Services. Paul Budde Communication Pty Ltd. Australia: Paul Budde Communication Pty Ltd, 2007. 27 May 2008 4. Malaysia - Mobile Communications - Major Operators. Paul Budde Communication Pty Ltd. Australia: Paul Budde Communication Pty Ltd, 2007. 27 May 2008 5. Malaysia - Mobile Communications - Market Overview. Paul Budde Communication Pty Ltd. Australia: Paul Budde Communication Pty Ltd, 2007. 27 May 2008 6. Malaysia - Telecommunications Infrastructure. Paul Budde Communication Pty Ltd. Australia: Paul Budde Communication Pty Ltd, 2007. 27 May 2008 7. Telecommunications. CIMB. CIMB, 2008. 27 May 2008 8. COUNTRY OVERVIEW. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008 9. Malaysia: Telecoms and Technology Forecast. Euromoney Institutional Investor Company. Economist Intelligence Unit Limited, The, 2007. 27 May 2008 10. INDUSTRY REVIEW : MALAYSIA. Creditassess. Malaysia: Creditassess, 2007. 27 May 2008 www.creditassess.com. 11. INTERNATIONAL SERVICES. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008 12. Malaysia Industry Research. Euromoney Institutional Investor Company. ISI Analytics, 2007. 27 May 2008 13. KEY NATIONAL DATA. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008 14. TELECOM OVERVIEW. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008 15. MOBILE TELEPHONE SERVICES. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008 16. TELECOMMUNICATIONS. OSK. OSK Research, 2008. 27 May 2008. 17. REGULATORY ENVIRONMENT. Asia Pacific Telecom. Asia Pacific Telecom Research Ltd, 2007. 27 May 2008. 18. Malaysia Telecommunications Report Q2 2007. Business Monitor International. London: Business Monitor International, 2007. 27 May 2008.    |
08marcus |
Latest page update: made by 08marcus
, Nov 16 2009, 9:55 PM EST
(about this update
About This Update
Edited by 08marcus
1 word deleted 4 images added 3 images deleted view changes - complete history) |
|
Keyword tags:
None
More Info: links to this page
|
There are no threads for this page.
Be the first to start a new thread.
