2018 Malaysia - Telecoms, Mobile and Broadband - Statistics and Analyses

Malaysia takes key steps to improve its fixed broadband access

With its widespread application of modern technologies such as fibre optics, wireless transmission, digitalisation and satellite services, Malaysia has built one of the more advanced telecom networks in the developing world.

The penetration of fixed lines in Malaysia continues to fall as the mobile segment continues to expand and dominate the market, especially the mobile broadband segment. The fixed line market is predicted to gradually decline over the next five years to 2023 as mobile and mobile broadband penetration continue to increase.

The country’s telecom sector, whilst still expanding and developing, has undergone a period of consolidation with its telecom companies operating in an ever increasingly competitive and changing market. Substantial government participation in ICT development has also been a particular characteristic of the Malaysian market. It has strongly backed the roll-out of a national broadband network.

The generally strong growth across the telecom sector has brought with it a flurry of investment interest and activity. The telecommunications market in Malaysia experienced privatisation in all facets of the industry and a general opening up of the market with a significant number of new licences being granted.

The government in Malaysia has a strong commitment to developing a technological society. As part of this strategy, it has encouraged a large number of high tech companies from around the world to set up a presence in Malaysia. Malaysia is continuing to promote itself as an Information Technology hub in the Asia region.

The Malaysian fixed broadband market remains underdeveloped. Telekom Malaysia’s fibre-based services on the THaArtHigh Speed Broadband (HSBB) network has seen progression in the fixed broadband market, however it has been slow.

Telekom Malaysia is rolling roll out a last mile access network to homes and businesses utilising fibre-to-the-home (FTTH), Ethernet-to-the-home (ETTH) and VDSL2 technologies. The ten-year HSBB 2 project encompasses the deployment of additional access and core capacity covering state capitals and selected major towns throughout the country.

Growth in the fixed broadband subscriber market has been flat over the past five years due to a stagnant number of fixed lines and the growing dominance of mobile broadband. Over the next five years to 2023 slow growth is expected to continue.

Under Nationwide Fiberisation Plan (NFP) announced in 2017, the government is seeking to expand the country’s fixed broadband infrastructure and increase the speeds available to consumers.

In 2018 Telekom Malaysia announced a strategy to significantly increase the number of Wi-Fi hotspots it had in operation.

Malaysia’s mobile market is relatively developed compared to other Asian markets but has experienced a slight decline in market penetration over the last four years due to an increasingly saturated market. Flat to very slow growth is predicted over the next five years to 2023 in the mobile subscriber market. It will be constrained from higher growth due to a saturated mobile subscriber market and strong local competition.

Progress has been reported on closing the urban/rural divide, with expanding mobile infrastructure in rural areas.

During the 2017-18 period Celcom Axiata and Maxis saw a significant decrease in mobile subscribers due to heightened competition.

Malaysia has seen a rapid increase in mobile broadband penetration over the past five to six years driven by strong growth of 4G mobile subscribers and high data caps. Strong but slowing growth is predicted over the next five years to 2023 as the market reaches a heightened state of maturity. The mobile broadband market will be driven by increasingly faster speeds offered by the mobile operators as they roll out their 4G and 5G networks and improving tariffs due to strong competition.

It is predicted that 5G will be used widely in Malaysia by 2022-2023. Ericsson has been collaborating with Universiti Teknologi Malaysia and Celcom Axiata Bhd to conduct ground studies on the implementation of 5G.

Key Developments

• The penetration of fixed lines continues to fall as the mobile segment continues to expand and dominate the market.
• The fixed line market is predicted to gradually decline over the next five years to 2023.
• The Malaysian government released a National Internet of Things (IoT) Strategic Roadmap.
• It is predicted that 5G will be used widely in Malaysia by 2022-2023.
• Malaysia has seen a rapid increase in mobile broadband penetration over the past six years.
• Slow growth in fixed broadband penetration is predicted for the next five years to 2023.
• Malaysia announced a strategy to significantly increase the number of its Wi-Fi hotspots.
• The government has released its Nationwide Fiberisation Plan (NFP).

Key companies mentioned in this report:

Axiata, Maxis Communications, U Mobile; DiGi; Altel; Alcatel Lucent; ZTE, TMNet; Telekom Malaysia; Celcom Axiata; Green Packet/Packet One Networks (P1); REDtone; Asiaspace; YTL; Time DotCom, Fibrecomm.