Slow Internet Speed Harming Malaysia’s Digital Economy Dreams


Malaysia’s less than favorable internet speed is harming the country’s aspirations in building an accelerated digital economy, reports Digital News Asia.

Ecommerce is set to be one of the key drivers of Malaysia’s digital economy, but that aspiration may be dampened by the relatively slow internet speeds available in the country, according to Yasmin Mahmood, CEO of Malaysia Digital Economy Corporation.

Malaysia’s average internet speed of 7.3Mbps was far below the global average of 23Mbps.

In comparison, Singapore enjoys an average connection speed of 122Mbps and even a developing country like Indonesia is fast catching up, with average speeds of 6Mbps. The Indonesian government has also announced that it aims to overtake Malaysia by 2019.

It is well known that consumers are less likely to shop or partake in online activities if the connection is not up to par. Malaysia’s notoriously slow internet speeds are often the subject of irritation by consumers and corporates. The worrying implication is that the growth of ecommerce will be affected if the connectivity does not improve.

In terms of data speed and affordability in the mobile space, Malaysia is not far off from other countries, but the big gap lies within broadband connectivity. This responsibility falls right under the Malaysian Communication and multimedia commission’s charter, and should be fixed as soon as possible.

It does not help that Communications and Multimedia Minister Dr Salleh Said Keruak was quoted as saying that Malaysians choose to pay less for slower Internet speeds instead of spending more on fast connections.

Malaysia’s online market is set to grow to $21 billion by 2025, mainly with ecommerce as a key driver, which would record an expected compound annual growth rate of 24%. However, it is falling behind in investments, despite the country’s promising ecommerce potential. Malaysia is also falling behind in terms of foreign direct investment in the Southeast Asian region, which is mainly going to Singapore and Indonesia.

A version of this appeared in Digital News Asia on July 20. Read the full version here.