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APEC
APEC // E-COMMERCE
E-COMMERCE
CONVENTION
CONVENTION
Tokyo,
Tokyo, Japan
Japan
“Powering APEC Economies into the New Millennium”
AGENDA
1
Multimedia Super Corridor as Catalyst for ECommerce in Malaysia
2
E-Commerce Readiness and Impediments
Survey for Small Medium Enterprises and Large
Enterprises in Malaysia
3
Telecommunication and Internet Statistics
4
Challenges for Malaysia
COUNTRY PROFILE - MALAYSIA
Capital :
Kuala Lumpur
Area :
329,733 sq km
Population :
22.71 million
Currency :
Ringgit (RM)
Urban Population:
50%
GDP :
$74.86 Billion (1998)
GDP per capital :
$3,193 (1998)
E-COMMERCE INITIATIVE DRIVEN BY THE
MULTIMEDIA SUPER CORRIDOR
A Total of 50 out of 300 (Jan’2000) MSCStatus Companies whose businesses
relate directly to EC.
GOVT EC RELATED
PROJECTS
} Electronic Government
} Multi-Purpose Card
} Smart Schools
} Telemedicine
BILL OF GUARANTEES
The Government of Malaysia commits the following to
MSC Status Companies:
1. Provide a world-class physical
and information infrastructure
6. Become a regional leader in
intellectual property protection
and cyberlaws
2. Allow unrestricted employment
7. Ensure no censorship of
of knowledge workers
Internet
3. Ensure freedom of ownership
8. Provide globally competitive
4. Allow freedom of sourcing
telecoms tariffs
capital globally for MSC
9. Tender key MSC infrastructure
infrastructure and freedom of
contracts to leading companies
borrowing funds
willing to use MSC as their
5. Provide competitive financial
regional hub
incentives including no income
10. Provide a high powered
tax or an investment tax
implementation agency to act as
allowance for up to ten years
an effective one-stop superand no duties on the import of
shop
multimedia equipment
COMPREHENSIVE SET OF CYBERLAWS
TeleMedicine
TeleMedicine Act
Act 1997
1997
Digital
Digital Signature
Signature Act
Act 1997
1997
The Communications
and Multimedia Act 1998
Copyright
Copyright Act
Act
(Amendments)
(Amendments) 1997
1997
*Consumer
*Consumer Protection
Protection Bill
Bill 1999
1999
Computer
Computer Crime
Crime Act
Act
1997
1997
Personal
Personal Data
Data Protection
Protection Act
Act
CERTIFICATION AUTHORITY
(EC Enabler)
Two
Two CAs
CAs established
established to:
to:
Provide
Provide and
and enhance
enhance trust
trust on
on
the
the web
web
Legally
Legally recognise
recognise electronic
electronic
signature
signature
Facilitate
Facilitate cross
cross border
border cross
cross
certification
certification
www.digicert.com.my
TO
TO OPERATE
OPERATE A
A CA,
CA, THE
THE
CONTROLLER
CONTROLLER OF
OF THE
THE
CERTIFICATION
CERTIFICATION AUTHORITY
AUTHORITY
NEED
NEED TO
TO ISSUE
ISSUE TWO
TWO
LICENSES
LICENSES
1.
1. ESTABLISHMENT
ESTABLISHMENT LICENSE
LICENSE
2.
2. OPERATIONAL
OPERATIONAL LICENSE
LICENSE
ELECTRONIC PAYMENT SYSTEM
(EC Enabler)
MALAYSIAN
ELECTRONIC
PAYMENT
SYSTEM
MEPS
MEPS was
was established
established to:
to:
Provide
Provide the
the infrastructure
infrastructure to
to enhance
enhance and
and
widen
widen the
the financial
financial distribution
distribution channels
channels
Operate
Operate an
an efficient
efficient and
and effective
effective clearing
clearing
and
and settlement
settlement system
system and
and process
process
Define
Define and
and develop
develop aa complete
complete solution
solution for
for
various
various payment
payment modes
modes
Support
Support both
both SET
SET and
and SSL
SSL protocols
protocols
http://www.meps.com.my
SET Payment Gateway Partners
Hong Leong Bank ò Malayan Banking ò Public Bank ò RHB Bank
AGENDA
1
Multimedia Super Corridor as Catalyst for ECommerce in Malaysia
2
E-Commerce Readiness and Impediments
Survey for Small Medium Enterprises and Large
Enterprises in Malaysia
3
Telecommunication and Internet Statistics
4
Challenges for Malaysia
ELECTRONIC COMMERCE READINESS
AMONGST SMEs IN MALAYSIA
Survey of Electronic Commerce Readiness and Impediments to EC Adoption (1999)
SMALL MEDIUM ENTERPRISES
Survey Sample:
} Sample of 811 SMEs
throughout the Peninsular
and East Malaysia
} Four (4) major sectors
surveyed;
} Construction
} Manufacturing
} Service
} Agriculture
Most ready sectors in
terms of EC capabilities
and awareness;
} Services and
} Manufacturing
E-COMMERCE CAPABILITIES AMONG SMEs
TYPE OF INDUSTRY
TOTAL
%
A strategy for e-commerce
Construction
%
7
16
Computers
90
Access to the Internet
55
Have electronic mail
49
Manufacturing
%
22
85
Service
%
21
92
35
24
Agriculture
%
8
93
62
68
54
66
75
38
29
Company web site
17
4
23
25
4
Web site advertising of products/services
15
2
20
21
4
Internet based order taking
7
3
Internet based order payment
2
2
Customer service via the Internet
17
Internal computer network
External computer network linking
key business partners
Computerized database of customers
11
1
4
31
9
22
8
2
0
4
0
23
31
18
8
0
45
17
0
49
34
54
Computerized database of suppliers
43
30
52
47
Computerized inventory of products
39
53
44
BASE: All Firms
811
21
227
225
4
57
273
42
38
25
24
•• Only
Only 7%
7% of
of SMEs
SMEs are
are selling
selling through
through the
the Internet.
Internet. Of
Of this,
this, 49%
49% responded
responded that
that Internet
Internet
sales
is
less
than
10%
of
their
total
sales
sales is less than 10% of their total sales
•• Only
Only 13%
13% of
of the
the SMEs
SMEs are
are purchasing
purchasing through
through the
the Internet.
Internet. Of
Of this,
this, 68%
68% responded
responded that
that
Internet
Internet purchases
purchases are
are less
less than
than 10%
10% of
of their
their total
total purchases
purchases
COMMON CONCERNS AMONG SMEs
Survey of Electronic Commerce Readiness and Impediments to EC Adoption (1999)
SMALL MEDIUM ENTERPRISES
Primary barriers to implementation are:
Ø
High set-up costs
Ø
Lack of technical knowledge to implement EC
Ø
Lack of critical mass
Ø
Inadequate legislation protecting IP rights
Ø
Lack of standards of conducting trade nationwide and globally
ELECTRONIC COMMERCE READINESS
AMONGST LARGE ENTERPRISES
Survey of Electronic Commerce Readiness and Impediments to EC Adoption (1999)
LARGE ENTERPRISES
Survey Sample:
} Sample of 385 firms were
surveyed.
} In these industries:
} Manufacturing
} Industrial
} Consumer
} Wholesale/Retail
} Finance
} Agriculture
Most ready sectors in
terms of EC capabilities
and awareness;
} Finance,
} Consumer,
} Wholesale/Retail and
} Manufacturing
E-COMMERCE CAPABILITIES AMONG LEs
Agriculture/
Construction/
BS/Tele
%
TYPE OF INDUSTRY
Manufacturing
(Any)
%
TOTAL
%
A strategy for e-commerce
21
16
Industrial
%
15
Consumer
%
Wholesale/
Retail
%
17
Finance
%
29
38
16
Access to the Internet
86
86
88
84
82
85
90
Have electronic mail
85
89
88
90
78
79
86
Company web site
44
43
Web site advertising of
products/services
Internet based order taking
36
34
Internet based order payment
Customer service via the Internet
11
12
5
5
20
External computer network linking
key business partners
Computerized database of customers
3
15
3
19
84
Internal computer network
44
30
16
83
28
43
46
34
38
4
17
9
6
4
10
6
81
24
86
23
19
50
79
81
Computerized database of suppliers
70
77
76
78
77
Computerized inventory of products
73
82
166
89
77
77
96
28
74
87
19
83
77
385
31
9
77
BASE: All Firms
40
9
22
33
51
22
92
69
44
86
78
80
63
56
48#
56
89
• Only 7% of LEs are selling through the Internet. Of this, 84% responded that Internet
sales is less than 10% of their total sales
• Only 13% of the LEs are purchasing through the Internet. Of this, 80% responded that
Internet purchases are less than 10% of their total purchases
COMMON CONCERNS AMONG LEs
Survey of Electronic Commerce Readiness and Impediments to EC Adoption (1999)
LARGE ENTERPRISES
Primary barriers to implementation are:
Ø
Lack of public trust on the internet
Ø
High set-up costs
Ø
Ø
Inadequate legislation protecting IP
Current technologies do not address security and privacy
concerns
Ø
Insufficient customers/suppliers have Internet access
AGENDA
1
Multimedia Super Corridor as Catalyst for ECommerce in Malaysia
2
E-Commerce Readiness and Impediments
Survey for Small Medium Enterprises and Large
Enterprises in Malaysia
3
Telecommunication and Internet Statistics
4
Challenges for Malaysia
COUNTRY PROFILE - MALAYSIA
Policy Direction:
Ministry of Energy, Communications
and Multimedia
Licensing and Regulatory:
Communication and Multimedia
Commission
Equal Access :
since January 1999
Internet and Content policy :
No censorship of the Internet
Encourage Industry Self Regulation
WTO ITA Signatory :
Yes, fully adhering to ITA
IPR Legislation :
Copyright Act 1997, Signed WIPO
Treaty
COUNTRY PROFILE - MALAYSIA
Telephone density :
Overall: 22% / Rural: 7% – 10%
Main Telephone line :
4.52 million (Sept’99)
Telephone Penetration :
22 per 100 population
Waiting list for Telephone lines :
130,000 subscribers
Cellular subscribers :
2.48 million (Sept’99)
No. of paging Subscribers :
55,000 (1998)
Internet Subscribers :
600,000
International Outgoing Traffic :
262 million minutes (1998)
Network digitalisation :
Switching : 100%
Transmission : 90% (1998)
FOREIGN EQUITY IN TELCOS
Network Services Operator
Telekom Malaysia
www.telekom.com.my
Time Telecommunications
www.time.com.my
Celcom
www.celcom.com.my
Digi Telecommunications
www.digi.com.my
Maxis Communications
www.maxis.com.my
% Foreign Equity
Foreign Partner
NONE
Under discussion
NONE
Under discussion
30%
Deutche Telecom
30%
Telenor, Norway
33%
British Telecoms
Source: Ministry of Energy, Communications & Multimedia
SERVICE PROVIDERS IN MALAYSIA
Network Services Operator
Telekom Malaysia
Mobile
ISP
www.telekom.com.my
Atur450 / Mobifon
TM Touch (PCN)
TMnet
Time Telecommunications
ADAM (PCN)
TimeDotCom
ART900 / Celcom GSM
& ETACS
Celcom Internet
Digi1800 (PCN)
DigiNet
www.time.com.my
Celcom
www.celcom.com.my
Digi Telecommunications
www.digi.com.my
Maxis Communications
www.maxis.com.my
MaxisMobile (GSM)
Jaring (MIMOS)
Source: Ministry of Energy, Communications & Multimedia
BREAKDOWN OF CELLULAR
SUBSCRIBERS IN MALAYSIA (1999)
Service Provider
Telekom Malaysia
Mobile Network
Subscribers
Mobifon 800 AMPS
130,000
TM Touch PCN
120,000
Atur 450 NMT
72,000
Celcom
Celcom ART900 / GSM
930,000
Maxis
Maxis Mobile GSM
600,000
Digi Telecom
Digi1800 PCN
500,000
Time Telekom
Adam PCN
130,000
Total Subscribers :
2,482,000
INTERNET SERVICES
SERVICES
PSTN
Dial-up Access
Transmission Speed
< 56K
Dedicated Access
64Kbps – 2Mbps
ISDN
64Kbps – 128Kbps (BRI)
ADSL
1.5Mbps
PSTN DIAL-UP INTERNET ACCOUNT
Access
Fee
(cent/min)
Call
Charges
(cent/min)
Registration
Fee (RM)
Annual
Subscription
Fee (RM)
Student /
Handicapped
25.00
18.00
1.0
1.5
School
25.00
24.00
1.0
1.5
Personal
25.00
24.00
1.0
1.5
Organisation
50.00
60.00
2.5
1.5
Categories
} Pricing structures for consumers/businesses connecting
to the Internet on a dial-up basis is Minutes of use.
US$1.00 = RM3.80
DEDICATED INTERNET ACCESS RATES
Transmission
Speed (kbps)
Registration
Fee (RM)
Installation
(RM)
64
300
1,000
24,000
128
300
1,000
32,000
256
300
1,000
48,000
512
300
1,000
64,000
768
300
1,000
80,000
1,536
300
2,000
112,000
2,048
300
2,000
128,000
} All rates do not include telecommunications charges (e.g. leased lines)
Annual Access
Fee (RM)
US$1.00 = RM3.80
Installed Base (millions)
MALAYSIA – INTERNET & INTRANET
DEVICES (1997 - 2004)
Total PCs/Network Computer Use
INTERNET
3.50
Total PCs/Network Computer Use
INTRANET
3.00
2.50
2.00
1.50
1.00
0.50
1997
1998
1999
2000
2001
2002
2003
2004
ω Devices include PC’s, Net TVs, screenphones, Internet smart handheld devices,
Internet game consoles, PDA devices and other Internet-access devices.
Source: International Data Corporation, 1999
No. of Personal Computers (millions)
PC PENETRATION IN MALAYSIA
1.80
1,687,562
1.60
1,468,825
1.40
1.20
1.00
1,000,000
880,000
0.80
0.60
0.40
0.20
1996
1997
Source: International Data Corporation, 1999
1998
1999
INTERNET USERS IN MALAYSIA
(1997 –2004)
4.50
Internet Users (millions)
4.00
3.91
3.50
3.63
3.23
3.00
2.72
2.50
2.00
1.89
1.50
1.00
1.27
0.50
0.58
0.44
1997
1998
1999
Source: International Data Corporation, 1999
2000
2001
2002
2003
2004
PERCENTAGE BREAKDOWN OF INTERNET
USERS IN MALAYSIA - 1999
Government
5%
Medium/Large Business
47%
Education
18%
Home
14%
Small Business
16%
} In Malaysia the general trend has the Home-User taking
an increasing percentage of the overall Internet user market.
Source: International Data Corporation, 1999
INTERNET BUYERS IN MALAYSIA
1997 - 2004
# Small Business
WWW Buyers
18%
# Medium/Large
Business WWW
Buyers
51%
# Home WWW
Buyers
17%
# Education
WWW Buyers
8%
Source: International Data Corporation, 1999
# Government
WWW Buyers
6%
INTERNET COMMERCE REVENUE IN
MALAYSIA, 1997-2004
Internet Commerce Revenue (US$m)
Total Revenue/Year (US$m)
Directly Completed on WWW Revenues/Year (US$m)
4,000.00
3,500.00
3,000.00
2,500.00
2,000.00
1,500.00
1,000.00
500.00
1997
1998
1999
Source: International Data Corporation, 1999
2000
2001
2002
2003
2004
INTERNET SPENDING IN MALAYSIA (1999)
Internet Spending (US$m), 1999
Personal Use (US$m)
28.07
Business End Use (US$m)
16.88
Supply Chain (US$m)
13.94
Total Internet Commerce (US$m)
58.89
Supply Chain
19%
Business End Use
31%
Personal Use
50%
Type of product purchased from the web
PERSONAL INTERNET SPENDING IN
MALAYSIA, 1999
Hardware Goods (electronics,
Automobiles, machinery, etc.)
Travel and Leisure
Books
Computer Software
Brokerage (Banking,
Insurance, Real Estate, etc.)
CDs/Video/Music
Subscriptions
Others
1.00
2.00
3.00
4.00
5.00
6.00
7.00
eCommerce Revenue from “Personal” Spending (US$m)
Source: International Data Corporation, 1999
PARTICIPATION IN INTERNATIONAL FORA
APEC
•
•
Comprehensive sub-fora - APEC TEL, PECC, UNTEC
Opportunity for joint venture projects with other APEC
economies
•
UNCITRAL Model Law is the basis for legislation
pertaining to Electronic Transactions
Seek global solution to avoid ‘Conflict of Laws’
UNCITRAL
•
WIPO
•
•
IPR related to electronic transfer of intangible goods
Cross-border dispute resolution and arbitration
mechanisms
OECD
•
•
The OECD is the leading think tank on E-commerce
Malaysia to participate as an observer
AGENDA
1
Multimedia Super Corridor as Catalyst for ECommerce in Malaysia
2
E-Commerce Readiness and Impediments
Survey for Small Medium Enterprises and Large
Enterprises in Malaysia
3
Telecommunication and Internet Statistics
4
Challenges for Malaysia
CHALLENGES FOR MALAYSIA
Build Critical Mass
Build Trust on the Web
Attracting Inbound Consumers
Organisation Transformation
Policy and Regulatory Framework
Source: MSCTC - National Electronic Commerce Masterplan
BUILD CRITICAL MASS
î Increase internet penetration
î Increase access devices penetration
î Improve telecommunication infrastructure
î Improve tariff and network access
BUILD TRUST ON THE WEB
î Security
î Privacy of information
î Electronic payment systems
î Improve fulfillment services
î Building awareness & skills
ATTRACTING INBOUND CONSUMERS
î Global connectivity
î Local content development
î Web hosting
î Building Malaysian brand
ORGANISATION TRANSFORMATION
î Creating EC Corporations
î Workculture
î Digital value chain
î Incentives
î Venture funding
POLICY AND REGULATORY FRAMEWORK
î Intellectual property rights & commercial codes
î Consumer protection
î Taxation
î Dispute resolution
ISSUES TO BE ADDRESSED
Other issues that need to be addressed:
• Cross-border issues
– Standards and common platforms
• Networking with International Cybercities & R&D
Institutions
– Establish experience and knowledge sharing
• Cyberlaws
– Optimal means of harmonizing existing laws to facilitate EC
– Safeguarding community from negative contents
• IPR
– New approaches to tackling piracy e.g. price/market
differentials
Thank-you
[email protected]