NEWS: Stimulus boost for broadband

FAST IMPROVEMENT?: Pikom says that the RM5.4bil allocation given to by the government in its recent stimulus plan to improve broadband services, will help speed up the implementation of the High Speed Broadband Service to the entire nation.

By STEVEN PATRICK

PETALING JAYA: Broadband got a bit of a boost from the mini-budget announced by Deputy Prime Minister Datuk Seri Najib Tun Razak last Tuesday.

A total of RM5.4bil out of the RM60bil stimulus total has been allocated to improve the country’s broadband infrastructure.

David Wong, chairman of the Association of the Computer and Multimedia Industry of Malaysia (Pikom) said that this move would help achieve the Government’s 50% broadband penetration rate target by the end of 2010.

The broadband penetration rate is currently 17.5% of households in Malaysia, according to the Malaysian Communications and Multimedia Commission (SKMM).

According to Wong, RM3bil will be used to roll out the High Speed Broadband (HSBB) service to the entire nation at a faster rate.

Originally, the project scope called for HSBB infrastructure to be provided to 1.3 million premises by the end of 2012.

Pikom hopes that this will be done faster but did not specify further.

HSBB promises surfing speeds of 2Mbps to 1Gbps.

Besides this, another RM2.4bil has also been provided to the SKMM to facilitate broadband community centres and provision of basic telephony services in rural areas. SKMM is the telecommunications multimedia sector watchdog.

“There are currently 180 community centres in the rural areas. This fund will help build more of these centres and equip the current ones better,” he said.

“These centres typically have five to ten PCs,” Wong added.

Helping outsourcing

Wong added that the mini-budget would also help the outsourcing sector as retrenched workers could be placed in this sector.

“We laud the Government’s initiative in encouraging companies to employ retrenched workers by giving them double tax incentives; we see this benefiting Shared Services and Outsourcing (SSO) companies as they gear themselves to recruit 300,000 workers by 2012,” he said.

Wong added that the collaboration between the Government and private sector to provide training and job placements and the creation of Jobs Malaysia Centres (which offer career counselling) would help in addressing the shortage of skilled ICT workforce.

“We will promote SSO through the centres,” he said.

Another positive move for the ICT sector is the fact that government procurements will be made through open tenders, except for a few specific cases.

“This will encourage competitive bids and strengthen the value-for-money concept in government procurement and tenders.

“We strongly support the Government’s call to use e-Perolehan (online tender system) to enhance the transparency in the management of government contracts. This will show IT as an enabler to efficiency,” he said.

Shortcomings

Despite the general benefits, Wong feels that the budget has some shortcomings.

“We feel that the mini-budget seemed to lack a ‘big bang’ impact. It does not address the short-term needs immediately. This is especially with regard to putting more money into the public pockets to immediately boost consumer spending (on PCs , services and software) ,” he said.

Pikom had submitted a wish list to the Government in February, in anticipation of the second stimulus package.

High on Pikom’s list was the reinstatement of the EPF PC purchase scheme, which was discontinued after it was discovered that many had abused the scheme.

Besides the revival of the EPF PC purchase scheme, Pikom also proposed that the Government offer a RM1,000 tax rebate for PC purchases, once every three years.

Wong said that Pikom was “disappointed” that these particular suggestions were not addressed in the second stimulus package.