Limited competition in Malaysia leads to high cost of fixed broadband internet services according to World Bank

As a Malaysian, we do aware that our internet services are slow compared to other countries, yet we are paying considerably more for it. While in the latest edition of the Malaysia Economic Monitor by World Bank, we have finally know the part of reasons behind it – it is because of the limited competition, with Telekom Malaysia Bhd (TM) having a significantly larger market share than the leading firms in other countries.

Here is how TM contributed to the higher fixed broadband prices, according to World Bank:

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.

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.

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.

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Malaysia ranked 74 of 167 countries for fixed broadband services and 64 of 118 for fibre broadband services. Also, according to the statistics result in February, Malaysia’s average download speed was ranked 63rd of 130 countries with an average download speed of 22.56 Mbps.

This places it behind regional peers, such as Vietnam, and countries with a similar level of economic development, such as Mexico and Turkey. Meanwhile, our regional comparators such as Singapore (161.53 Mbps) and South Korea (129.64 Mbps) came in top and third place in the world ranking!

With the announcement of Unifi Turbo, we could finally see some effort from our government (Malaysia government) in raising the quality of internet services. But the effort shouldn’t stop here, we still hope to see improved quality as well as increased coverage of high-speed broadband networks in the future so that we could compete with other countries more effectively (especially in economy and eSports aspect).

Source: New Straits Times

*feature image credits to Gizmodo Australia