MALAYSIAN COMMUNICATIONS AND MULTIMEDIA COMMISSION - A Malaysian Experience in USP

© Malaysian Communications and Multimedia Commission, 2002

MALAYSIAN COMMUNICATIONS

AND MULTIMEDIA COMMISSION

- A Malaysian Experience in USP

17 March 2003

2© Malaysian Communications and Multimedia Commission, 2002

AGENDA

1. The Malaysian initiative on convergence

2. The Commission and Licensing Framework

3. Universal Service Provision


Malaysian Initiative

onConvergence


Institutional changes to facilitate convergence

1 Apr 991 Apr 99

Redefinition ofthe Ministry’sfunctions and

formation of CMC

Ministry of Energy,Telecommunications & Post

1 Nov 981 Nov 98

Ministry of Energy,Communications & Multimedia

Malaysian Communications and Multimedia Commission formed

Replacementof sectoral

regulators by aconvergence

regulator

JTM

MOI (Licensing Division)

MalaysianCommunicationsand Multimedia

Commission

Replacementof sectoral Acts

by a convergenceAct

Telecommunications Act 1950

Broadcasting Act 1988

MalaysianCommunicationsand Multimedia

Act 1998


The Commissionand

Licensing Framework


The Commission has a dual role in the C&M sector

Regulatory(Conformance)

Managing for conformance

Developmental(Performance)

Planning for Performance

In fulfilling its role, the Commission is guided by the 10 National Policy objectives for communications and multimedia


10 National Policy Objectives for the Communications & Multimedia sector

1. Creating a global hub: To establish Malaysia as a major global centre and hub for communications and multimedia information and content services;

2. Building a civil society: To promote a civil society where information-based services will provide the basis of continuing enhancements to quality of work and life;

3. Nurturing local content and culture: To grow and nurture local information resources and cultural representation that facilitate the national identity and global diversity;

4. Ensuring long-term benefits for end-users: To regulate for the long-term benefit of the end user;

5. Nurturing user confidence: To promote a high level of consumer confidence in service delivery from the industry;

6. Promoting access and equity: To ensure an equitable provision of affordable services over ubiquitous national infrastructure;

7. Creating a robust applications environment: To create a robust applications environment for end users;

8. Facilitating efficient allocation of resources: To facilitate the efficient allocation of resources such as skilled labour, capital, knowledge and national assets;

9. Developing industry capabilities: To promote the development of capabilities and skills within Malaysia’s convergence industries, and

10. Promoting secure and safe networking: To ensure information security and network reliability and integrity.

Source: Section 3(2) of the Communications and Multimedia Act 1998 (Act 588)


Licensing for convergenceTele

com

muni c

ati

on

l icence

Bro

ad

cast

ing

licence

ISP lic

ence

VA

N lic

ence

Network FacilitiesNetwork Facilities

Network ServicesNetwork Services

Applications ServicesApplications Services

Content ServicesContent Services

The old licenses that were issued were based on specific

technologies, and specific services

Licenses issued under CMA 98 are technology-

neutral and service-neutral

The new licensing framework promotes vertical separation between facilities,

network, applications, and content

Under the old licensing framework all activities

related to the provision of a particular service are

vertically integrated for the provision of that service


Industry Participants under CMA

Network Facilities Provider (NFP)

Owners of facilities such as satellite earth stations, broadband fibre optic cables, telecommunications lines and exchanges, radio communications transmission equipment, mobile communications base stations, and broadcasting transmission towers and equipment

Network Service Providers (NSP)

Provides the basic connectivity and bandwidth to support a variety of applications

Applications Service Providers (ASP)

Provides particular functions such as voice services, data services, content-based services, electronic commerce and other transmission services

Content Application Service Providers (CASP)

A special subset of applications service providers including traditional broadcast services and newer services such as online publishing and information services


Universal Service Provision (USP)


Household penetration rates of various services

Television sets 95%

Mobile phones 54%

22%

Fixed lines 75%

59%

PC 24%

9%Urban households

Rural households

Total households


The two prong strategy for bridging the digital divide

Multimedia servicesBroadband accessCompetitive rates

Basic servicesBasic access

Affordable rates

Provide

Catch-up to reduce the digital divide within the country

% P

STN

penetr

ati

on

GDP per capita

Ramp up to capture the digital opportunities


The Overall objectives for Universal Service Provision

To promote the widespread availability and usage of network services and/or

applications services throughout Malaysia by

encouraging the installation of network facilities and the

provision of network services and/or applications

services in underserved areas or for underserved

groups within the community


Definition of “underserved”

• “Underserved area” means an area where the penetration rate for PSTN is 20% below the national penetration rate

• “Underserved group within the community” means a group of people linked by similar characteristics from a socio-cultural or economic perspective, within a served area, who do not have collective or individual access


System of USP set in the CMA

Public Inquiry

Ministerial Direction

Commission Determination

Communications and Multimedia (Universal Service Provision) Regulations 2002

Latest Regulation


System of USP in the CMA

• Section 202(1) - The Minister may direct the Commission to determine a system to promote the widespread availability and usage of network services and/or applications services throughout Malaysia by encouraging the installation of network facilities and the provision for network services and/or application services in underserved groups within the

community • Section 203(1) – A determination by the Commission

under subsection 202(1) shall include definitions of “underserved areas” and “underserved groups within the community

• Section 204(1) - For the purposes of this Act, a fund to be known as the “Universal Service Provision Fund” (“USP Fund”) is established and it shall be controlled and operated by the Commission

• Section 204(2) – The Minister may make regulations regarding contributions by licensees, under this Act, to the USP Fund and any other matters related to or incidental to the establishment and operation of the USP Fund


• USP Objectives• Notification of universal service targets• Universal Service Plan and Designation of Universal Service Provider• Implementation of the Universal Service Plan• Costing of USP• USP Fund

Communications and Multimedia (Universal

Service Provision) Regulations 2002


Graphical representation of the Four USP objectives

Objective 1:Collective access

to basic telephony and public payphone

services

Objective 3:Collective access

to Internet access services

Objective 2:Individual access to

basic telephonyservices

Objective 4:Individual access to

Internet access services

Collective access

Individual access

Basic telephony The Internet

SERVICES

TYPE

OF

AC

CE

SS


C&M (USP) Regulations - Graphical Points

Notification of universal service targets

USP Fund

Progress Report

Designation of the universal service provider

Draft universal service plan

Costing USP

Claims

Compliance with QOS standards

Licensees

Implementation of universal service plan

Underserved Connected


• Universal Service Plan and Designation of Universal Service Provider

Request licensee to submit draft of universal service plan in respect of universal service target identified Licensee draft universal service plan contain

• Location details within the universal service target• Network facilities to be installed• Technology deployed• Timetable for provision of application services• Capital cost for installation• Estimates of operating costs

Approval of Plan & designation of Universal Service Provider

Selected Highlights

• Implementation of the Universal Service Plan

Progress report – first report not later than 3 months from notification of approval of Plan and thereafter once every 2 months


• Costing of universal service provision Commission shall pay the designated universal service provider from the USP Fund the cost incurred in implementing the approved universal service plan in a universal service targetThe net cost in implementing the approved universal service plan is computed as:

Net USP cost = avoidable cost - revenue forgone

Selected Highlights

• USP FundContribution - By licensee of 6% of its weighted net revenue. Only by those whose net revenue > RM500,000.Commission shall maintain proper accounts of the USP Fund - Annual report and statement of accounts


• Register of USP(a) non-confidential summaries of the

approved universal service plans(b) designated universal service providers(c) universal service target(d) a list of licensees contributing to the USP

Fund

• General Penalty Any person who commits an offence under

these Regulations shall on conviction be liable to a fine not exceeding RM300,000 or to imprisonment for a term not exceeding 3 years or to both

Selected Highlights


• Digital Divide recognition measurement

• Implementation monitoring review

• Service Providers Cooperation

Key Issuesand

Resolution for Way Forward


THANK YOUMain Office:

Malaysian Communications and Multimedia Commission

Level 11, Menara Dato’ Onn,

Putra World Trade Centre,

45 Jalan Tun Ismail,

50480 Kuala Lumpur,

MALAYSIA

Tel: +603 4047 7000

Fax: +603 2693 4881

Website: www.cmc.gov.my

MALAYSIAN COMMUNICATIONS AND MULTIMEDIA COMMISSION - A Malaysian Experience in USP

Documents

Transcript of MALAYSIAN COMMUNICATIONS AND MULTIMEDIA COMMISSION - A Malaysian Experience in USP