Budget Debate

Broadband Penetration vs Broadband Quality vs HSBB

By Kit

October 30, 2009

The Finance Minister said in the budget speech that the Government will expedite the implementation of HSBB at a total cost of RM11.3 billion, of which RM2.4 billion is from the Government and RM8.9 billion from Telekom Malaysia, and that a speed of 10Mbps will be provided in selected areas in Kuala Lumpur and Selangor by end-March 2010 while these services will be extended to other selected areas nationwide between 2010 and 2012. He also said that Malaysia’s broadband penetration is currently at 25%, a rate that is far lower compared to Korea, Singapore, Japan and United States.

There is a contradiction here.

In simple terms, administration is spending RM2.4 billion to encourage Telekom Malaysia to spend RM8.9 billion for selected areas in KL and Selangor to be further extended to other selected areas nationwide.

The government policy in subsidizing HSBB is creating broadband desert in the rural area as its fiscal policy continues to favour the urban and high-income rakyat as shown by its tax cut for the top-earners. To narrow the digital divide and to bring oasis to the broadband desert in Malaysia; I hereby propose the RM2.4 billion resources be channelled to provide minimum Broadband speed of 512 kbps to all Malaysians for free of charge. The RM2.4 billion govt grant should be matched ringgit to ringgit by Telekom Malaysia.

There’s nothing revolutionary in such a proposal. On 14 October 2009, Finland rocked the IT world with its announcement that “Starting next July, every person in Finland will have the right to a one-megabit broadband connection” With this announcement by the Finnish Ministry of Transport and Communications. Finland is the world’s first country to create laws guaranteeing broadband access.

Earlier on Finland had already decided to make a 100 Mbps broadband connection a legal right by the end of 2015. The new goal is an intermediary step for Finland.

CNN commented, “Finland is one of the most wired in the world…But the law is designed to bring the Web to rural areas, where geographic challenges have limited access until now.

Let me come to Broadband Penetration vs Broadband Quality. Broadband Penetration measurement is today’s literacy rate. The world’s leading economy have meanwhile moved on from Broadband Penetration measurement to Broadband Quality measurement.

Thirteen years ago Malaysia proclaimed the Multimedia Super Corridor (MSC) as “a gift to the world” and the centrepiece of the country’s strategic initiative to leapfrog the nation into the IT era to become one of the world IT powers.

Since then, MSC and Malaysia have faded away from the world radar screen as an international IT hotspot – and Malaysia’s unchecked plunge in IT international competitiveness in the past decade has been confirmed by another adverse global study, the 2009 Oxford/Cisco Global Broadband Quality Score.

This study of the global state of broadband quality put Malaysia 53rd out of 66 countries in terms of the quality and reach of its networks – understandably behind countries like Korea, Japan, Sweden, Denmark, United States but also trailing countries we should be leading like Turkey, Chile, China, Qatar, Brazil, Argentina, Saudi Arabia, Cyprus, Costa Rica, Bahrain, Thailand, Tunisia, Mexico, Philippines and UAE.

Malaysia could not make it into the three top broadband categories of “Ready for tomorrow” (nine countries led by South Korea and Japan), “Comfortably enjoying today’s applications” (16 nations), “Meeting needs of today’s applications” (14 nations), but falls into the last category of “Below today’s applications threshold” (27 nations) and occupying the 17th position.

South Korea and Japan continue to dominate the league table in this second global study, largely due to their commitment to fast networks. In South Korea, for instance, the government has promised universal speeds of up to 1Gbps by 2012.

Internationally, broadband quality has moved from one of penetration, i.e. who had broadband connection and who did not, to include broadband speed but Malaysia is till bogged down in the initial stage.

I have received an answer to my question to the Minister for Communications on the country’s international internet broadband capacity as Malaysian broadband users are not talking about 2Mbps – lucky if 512 or 256kbps without disruptions – in their daily experience with national broadband speed.

The Minister’s answer, that Malaysia’s cumulative total international internet bandwidth capacity is 112Gbps second as of June 2009, up from 64.1 Gbps in 2008, has given rise to more questions, viz: