Malaysian Communications and Multimedia Commission (MCMC) chairman Mohamed Sharil Tarmizi. — Digital News Asia picKUALA LUMPUR, Jan 7 — History repeated itself at the Malaysian Communications and Multimedia Commission (MCMC) at the end of December 2014 when its chairman Mohamed Sharil Tarmizi (pic) came back from his vacation to find a letter waiting for him in the office.
The letter was from the office of the Minister of Communications and Multimedia, Ahmad Shabery Cheek, thanking him for his services and informing him that his contract would not be renewed. It ended Dec 31 2014.
With that impersonal note, the curtain dramatically fell on Sharil’s 11 years of service at the industry regulator, with the last three as its chairman. He also had a six-month stint as acting chairman in 2008. He was not 40 years old then.
Back in October 2003, the second MCMC chairman Nuraizah Abdul Hamid suffered the same cold exit when she received a fax at 5pm from the then Minister of Telecomunications and Multimedia, thanking her for her services and informing her that her contract would not be renewed. She too had been chairman for three years.
Whether Sharil’s exit caught the 600-plus staff of the MCMC by surprise is not clear. Digital News Asia (DNA) could not get anyone to talk about this, but the telco industry is certainly abuzz with questions and speculation as to why Sharil’s term was not extended.
As at press time, the minister still had not issued any statements clearing the air.
The loudest speculation is that the Malaysian Government wants to put a member of Umno, the dominant political party of the ruling Barisan Nasional coalition, in the powerful post.
The prevailing view is that as head of the MCMC, Sharil did not do enough to curb dissenting voices against the Government in the digital sphere.
Another line of thinking is that the cash-rich MCMC provides plenty of opportunities for the business associates of Umno to fight over.
For instance, in the second quarter of this year, the MCMC will award the contract for 600 towers to be built in rural areas. The contract for the first 400 towers came up to around RM900 million (US$252 million). The next phase will cost more than RM1.3 billion (US$360 million).
While Sharil declined to comment when DNA contacted him, he has in the past made it known that the freedom of the Internet from censorship is one of the bedrock principles on which Malaysia is building its digital economy.
But it is obvious that a loud minority within Umno is having none of that.
Meanwhile, the telco industry is buzzing. “Shattering news,” is how one telco chief executive officer described it, preferring not to be named however.
While there clearly was some unhappiness with Sharil, a DNA Digerati50, from some of the established telcos, none wished to comment on any low points during his tenure.
Two analysts DNA spoke to however had positive things to say about the impact Sharil has made.
Avinash Sachdeva, senior industry analyst of the ICT practice at Frost & Sullivan, described Sharil’s tenure in positive terms: “Over the past three years, the MCMC focused on offering robust broadband and telecom service, and facilitated the development of world-class telecom infrastructure in Malaysia.”
Avinash also highlighted how the MCMC ensured quality of service and penalised service providers, which failed to meet accepted standards and levels of service.
Malaysia’s household broadband penetration improved from 62.3 per cent in the fourth quarter of 2011 to 67.8 per cent in Q3 2014; while cellular penetration improved from 128 per cent to 145 per cent during the same period. Smartphone penetration significantly improved from below 20 per cent to 48 per cent, through various initiatives such as smartphone rebates.
While one industry expert pointed out that these various services were already on a growth trajectory, as the telco and digital regulator, the MCMC under Sharil did not put in any impediments to adoption but was always encouraging it.
Meanwhile, a financial analyst observed, “The public may not realise it, but the industry was moving in the right direction under Sharil’s leadership.”
The analyst pointed to mobile operators, which offered poor services being slapped with fines on more than one occasion. The ban on promotional activities using shortcodes was also a definite plus, he added.
Meanwhile, despite the current speculation that a political appointee will fill the seat of chairman, a senior executive familiar with Malaysia’s telco regulation landscape is still hopeful that the next chairman would preferably be a technocrat.
“It should be someone who has industry background, with experience and a good track record in policy-making. He or she should be fair-minded and recognise the immense contribution of communications (mobile, broadband, and the Internet) to the growth and development of the country.
“That person should also recognise that the rakyat (citizenry) depend heavily on social media, e-commerce, online entertainment, and so on, as part of their daily lives,” said the senior executive who declined to be named.
Bulwark against political pressure
A financial analyst aware of how things work in Malaysia warned of the need to withstand “pressure” from the four mobile operators as all of them “will try to lobby for a piece of any spectrum that becomes available,” reports Goh Thean Eu.
The four operators are the government-linked Celcom Axiata, tycoon-backed Maxis (owned by Ananda Krishna) and U Mobile (owned by Vincent Tan of the Berjaya Group), as well as Scandinavian telecommunications giant Telenor ASA via its Malaysian subsidiary DiGi.
“Despite the high broadband and cellular penetration, the key priorities for the new chairman would be to promote and increase ICT adoption,” said Frost & Sullivan’s Avinash.
That, and ensuring the availability of reliable and secure network services at affordable prices.
The new chairman should also consider the following issues, noted an executive familiar with Malaysia’s telco regulation landscape:
Adequate amounts of spectrum awarded to operators, which can make the best, use of it and not waste a precious natural resource.
Since the Government has already assisted in the high-speed broadband (HSBB) rollout, much more can be done to accelerate such services to include mobile infrastructure such as Long-Term Evolution (LTE) via appropriate investment tax breaks, similar to what was done for the previous mobile communications technologies such as 3G (Third Generation) and ADSL (asymmetric digital subscriber line).
A review of the regulations, codes and guidelines to adapt to changes in technology and consumer demands.
Looking at spurring competition in some services, for example broadcasting (monopolised by Astro), fixed-line services (Telekom Malaysia), etc.
Formulate enabling policies to encourage new forms of services enabled by technology, for example mobile commerce and mobile financial services, big data, etc. — Digital News Asia
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