The monopoly, the internet, and the prices.

So here we are heading towards the end of 2008 (almost), with the last mile still closed after some muted discussions (I had no doubt that it would stay closed). Today, I have chosen to spew forth much ranting with regards to the pricing for local internet in Malaysia. I’ve chosen to compare TMNet (largest local telco backed by government, also decided that copper throughout Malaysia which was paid for by taxpayers… was theirs) and TIMENet (my current ISP). I’ve left out the wireless providers for now, mainly because 90% of techies who are in their right mind wouldn’t go for wireless unless it was the last resort.

TIMENet pricing vs TMNet pricing

Since there isn’t really a lowest common denominator (384 unlimited vs 384 time limited), I’ve decided to compare TIMENet’s 448kbps SDSL (HomeNet Pro 448/448, RM138/month) to TMNet’s 512kbps ADSL (512/512, RM66/month). 448kbps (RM138) is TIMENet’s highest offering at the home user level as compared to 2Mbps (RM188) for TMNet (their 4Mbps package isn’t widely available at the moment). What’s with the major discrepancy in pricing?

The government (and IT related entities) continuously rant and rave about making Malaysia some kind of regional focal point for the internet… all the while ignoring the steps they could take that could easily inject rocket fuel into the proverbial bum of the lumbering buffalo that is Malaysian internet. Given that opening the last mile (obviously the best choice) would hurt the bottom line of TMNet (and thus the government who owns XX% of TMNet), it’s fairly certain that the last mile wouldn’t be opened any time soon.

What’s the next best thing? IMHO, allowing only an X% deviation from a set price for a set amount of bandwidth. TIME customers pay double what their TMNet counterparts pay for a semi-equivalent connection… and while some time ago, it could be argued that TIME provided much better quality of service, this is definitely not holding true anymore (yes, TIME is almost as bad as using a banana boat in “The Perfect Storm”). Allowing possibly a 20% deviation upwards (and no limit downwards?) would result in a TMNET 512kbps staying at RM66, while forcing TIME to sell their 448kbps connection for a maximum of approximately RM80 (or no minimum!!!???).

While the last mile continues to be closed and conveniently “owned” by TMNet, there is no reason whatsoever for the pricing to fluctuate so much between different ISPs. The government and the MCMC are doing nothing but holding back any smidgen of growth the local internet user population may be capable of… but the truth is, haven’t the government/TMNet already made enough from their “ownership” of the last mile for the last 15 years or so?

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