Push to lower broadband costs in Malaysia

The announcement confirmed an earlier report that a consortium was being set up to buy international bandwidth for Internet traffic in bulk in a bid to reduce IP transit cost..

The reduction of IP transit cost is part of the “extend the regional reach” initiative under the Economic Transformation Plan. IP transit cost is the cost service providers pay to carry Internet traffic around the world but because most sites are hosted in the United States, traffic volumes to the US are high.

The consortium comprises 24 members including Telekom Malaysia Bhd (TM), Time Dotcom Bhd, Maxis Bhd, Celcom Axiata Bhd, DiGi.Com Bhd, U Mobile Sdn Bhd, Green Packet, YTL Communications Sdn Bhd, RedTone International Bhd, OCE, Fibrerail Sdn Bhd, Jaring, Sacofa, Sarawak Information Systems, Fibrecomm Networks (M) Sdn Bhd, and V Telecoms.

Fiberail and Fibrecomm are subsidiaries of TM.

“The main objective in setting up the consortium is to lower the broadband subscription cost for users through cost savings as the subscription cost of international bandwidth capacity accounts for 40 percent of the total cost of providing broadband services.

“To achieve the cost savings, the consortium will buy the capacity in bulk as well as plan and manage the international submarine cable on behalf of its members,” Rais said at a briefing to announce three all-new EPPs under the National Key Economic Area (NKEA) Communications Content and Infrastructure (CCI) yesterday.

The other two projects announced are the tracking and tracing of swiftlet nests using radio frequency identification technology and the enhancement of basic infrastructure in rural areas.