Friday 29 Mar 2024
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This article first appeared in The Edge Malaysia Weekly on October 8, 2018 - October 14, 2018

Malaysians have welcomed the news that four key telecommunications companies have agreed to reduce prices for fixed broadband access. This came after repeated reminders from Communications and Multimedia Minister Gobind Singh Deo that strict action would be taken against telcos that failed to lower prices.

However, what message is being sent to business owners and investors? Some may be wondering why pricing is not left to the market to decide.

Take mobile phone calls, for instance. Users now get unlimited free phone calls when previously, they were charged by the minute. Growing competition, due in part to new players, has forced telcos to adapt to survive.

Back in 2004, after Morten Lundal came on board, DiGi.com Bhd moved to cut rates, which led to intense but healthy competition.

More recently, consumers benefited from the emergence of U Mobile, which led to price competition in the mobile broadband space.

All these happened, to a large extent, without government interference.

Gobind’s push to lower broadband prices will please consumers. After all, everyone craves fast connectivity at an affordable price, if not for free.

But corporates may wonder which industry will be next. It may not be the right message to send to the business community.

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