BROADLY HIGHER FEE

MALAYSIANS are paying considerably more for fixed high-speed broadband compared with other countries, partly driven by limited competition, says the World Bank.

MALAYSIANS are paying considerably more for high-speed broadband than other countries, said the World Bank.

In its latest edition of the Malaysia Economic Monitor, it said the high cost of fixed broadband Internet services was partly driven by limited competition.

“While Malaysia has made significant progress in terms of facilitating affordable access to mobile Internet services, the cost of access to highspeed broadband services is relatively high compared to other countries.”

In terms of price per megabits per second (Mbps), Malaysia ranked 74 of 167 countries for fixed broadband services and 64 of 118 for fibre broadband services.

This places it behind regional peers, such as Vietnam, and countries with a similar level of economic development, such as Mexico and Turkey.

The World Bank said the limited competition, with Telekom Malaysia Bhd (TM) having a significantly larger market share than the leading firms in other countries, contributed to the higher fixed broadband prices in three ways.

“First, while TM is the major incumbent of cable-landing stations in Malaysia, rather than allowing for co-location of its stations with other operators, it instead provides point-of-access connection outside the stations and charges a higher fee, which translates to a higher cost of broadband rollout.

“Second, given TM’s extensive broadband networks, it has been awarded exclusive memorandums of understanding with the government to deploy the highspeed broadband and sub-urban broadband plans without contest. This eventually eliminates the possibility of attracting private investment by the network rollout operations.

“Third, Malaysia also pays a higher Internet protocol transit prices than is the case in other countries, and this is subsequently passed on to retail consumers of broadband services.”

The World Bank assessment was prepared before TM announced new broadband plans on Tuesday.

The World Bank also said Malaysia performed relatively poorly in the quality of its broadband services.

“In February, Malaysia’s average download speed was ranked 63rd of 130 countries, with an average download speed of 22.56 Mbps. This is significantly lower than regional comparators such as Singapore, which ranked as top place (161.53 Mbps) and South Korea, which came in third (129.64 Mbps).

“Countries with similar levels of economic development as Malaysia also have significantly faster download speeds.

“For example, Hungary has an average download speed of 90.94 Mbps while Thailand has an average speed of 41.35 Mbps.”

It said Malaysia should look beyond doubling its Internet speed and aspire to achieve gigabit-level of connectivity, similar to advanced economies.