enabling the next-generation digital …...enabling the next-generation digital revolution in...

ENABLING THE NEXT-GENERATION DIGITAL REVOLUTION IN MALAYSIA

Connectivity & Digital Services as the Catalyst

Mohd. Ali Hanafiah Mohd. Yunus

Chief Officer

Communications and Digital Ecosystem

Malaysian Communications and Multimedia Commission

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Draft for discussion only Confidential – for internal use only

Table of Contents

Connectivity and Digital Services

MCMC,

National Agenda Benefits

Transformation

DR for ASEAN 2025 Essentials Digital ID -Key Enabler

Target Key ICT Trends - Malaysia

Key ICT Trends - World Policy Statement

Privacy Challenge,

Takeaways, Conclusion

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THE MALAYSIAN COMMUNICATIONS

AND MULTIMEDIA COMMISSION

MCMC is the industry developer & regulator for the converged Communications and Multimedia sector which covers: Telecoms Broadcasting ISPs Postal and courier services Digital certification authorities.

|Malaysian Communications and Multimedia Commission|

A statutory body :

Established under the Malaysian Communications and Multimedia Commission Act 1998

Came into existence 1 November 1998

Dual function : Regulator & Industry development

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Empowering Internet Economy 2017

2017 will be the year of

'Internet Economy’ ~ The Honourable Prime Minister of Malaysia

YAB Dato’ Sri Mohd. Najib Tun Abdul Razak

"The digital revolution is

upon us at lightning

speed, so we must

embrace and adapt to

change"

The catalysts — physical

microcosms, risk capital

funding, connectivity,

talent and regulatory

framework — were keys to

the agenda.

“It is a cluster, or community of digital

hubs, where a new bread of internet

economy, mainly start-ups, scale-ups

and small and medium enterprises

connect, converge, share and create

ideas.”

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Nationwide Fiberization Plan (2017-2019)

Expansion of the country's fixed broadband

infrastructure

The fiber network would connect to about

6 million premises including an estimated

2 million premises in the rural areas

Be implemented by way of collborative

arrangement to provide fiber-based broadband

wholesale services

3-Tier model establishment

Tier 1 - Tenaga Nasional Bhd's fiber trunk network for wholesale backhaul services

Tier 2 - Wholesale Service Provider(s) would offer last mile access

Tier 3 - providers offering retail services to consumers and businesses

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Digital Revolution Has Brought Many Private Benefits

A typical day in the life of the internet…

SOURCE: WDR 2016 team; http://www.internetlivestats.com/one-second/ (As compiled on May 29, 2015)

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Digital Technologies That Transform the World – The Malaysian Experience

SOURCE: http://www.mudah.my

Number of deals on mudah.com:

1.7mil & counting

DIGITAL MARKETPLACE

DIGITAL PAYMENTS

Digital technologies are transforming PEOPLE’S LIVES

Digital technologies are transforming BUSINESSES

Number of e-payment volume & value nationwide:

192.45bil Vol & RM514.7Tril (2016)

Services with digital identity:

Electronic transactions and verification through government

online services and MyKad

DIGITAL IDENTITY

Digital technologies are transforming GOVERNMENT

Single Sign-

On by

MAMPU

Where the figures in

volume and value

increases every year

SOURCE: Electronic Payments – Volume and Value of Transactions. http://www.bnm.gov.my

HRMIS

MyKad

MUDAH

58 Categories of

products and

services

One of the top 10

websites in

Malaysia

FASHION VALET

Grew to 500 brands in just 6

years from 2010

Expansion of business – KL,

Singapore Jakarta and

Brunei

http://www.mudah.my/

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ICT – Key Enabler in the Digital Revolution

Innovation and advancements in ICT present revolution in the way people think, behave, communicate and earn livehood.

This Digital Revolution restructures conduct in business practices, economic activities and governance.

The International Telecommunication Union (ITU) is an agency of the United Nations (UN) whose purpose is to coordinate telecommunication operations and services throughout the world. Originally founded in 1865, as the International Telegraph Union, the ITU is the oldest existing international organization.

Connect 2020 Agenda

A vision for : an information society empowered by the

interconnected world, telecommunication/ICTs

enable sustainable socio- economic growth to achieve the following goals: GROWTH INCLUSIVENESS SUSTAINABILITY &

INNOVATION and PARTNERSHIP

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A True Digital Revolution Can Transform ASEAN by 2025

Source :

AT Kearney

Benefits of Digitalization : ASEAN Advantages

ASEAN – a young population (240mil from 600mil whole

population are under 30 years) - majority connected to

broadband via mobile phones.

94% of its adult population is literate. Of this youthful

240mil portion, 90% have access to the internet.

All of these facts could combine to make ASEAN a leader

in the digital economy, a development that could transform

the region by 2025.

Expected benefits (regional GDP) => $1 trillion.

Five policy imperatives for ASEAN to act :

1. Universal mobile broadband access

2. Accelerate innovation in mobile

3. Enhance trust and security

4. Strengthen the local digital economy

5. Foster digital innovation within ASEAN

By 2025, a digital revolution could transform daily life

in ASEAN, making physical cash obsolete and cities

smarter, safer places to live SOURCE: The ASEAN Digital Revolution (2015)

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The Fourth Industrial Revolution

The pace of technological change is faster than ever.

The agents of the Digital Revolution are proliferating i.e.

Artificial intelligence (AI)

Big Data

Mobile internet

Cloud technology

Robots in industry and the home

The internet of things (IoT)

Driverless vehicles

Drones

3D printers

Millions of people across the globe have access to huge databases, hence, experimentation and innovation are not only made in research centres

Billions of dollars of investment are made globally to develop and implement these agents of change

Virtual Reality

Artificial Intelligence

Driverless

Economy

Amongst Agents of Disruptive

Technology

SOURCE: The Digital Revolution : the Impact of the Fourth Revolution on Employment and Education

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1) Increasing content

fragmentation

2) Rise of OTT

3) Preference for online

channels

4) Rise of social media

5) Push for 'open‘ govt

data sharing

Global Technology Business & Govt

Consumer & Society

Source :

BCG

Analysis

1) Changing

demographics

• Increasing urbanization

• Increasing ICT demand

and spending

2) Regional & global

integration

3) Growing cyber crime

1) Cheaper computing

power, storage and

bandwidth

2) Rise of broadband and

mobile connectivity

3) Proliferation of devices –

smartphones, wearables,

drones

4) Proliferation of Internet

of things

5) Artificial intelligence and

robotics

1) Increasing demand for

e-commerce & e-gov

services

2) Big data and advanced

analytics

3) Rise of cloud computing

4) Rise of ecosystems

5) Integration of infrastructure

and public services

6) Integrated transportation

systems, smart grid, smart

cities

B C D A

THE DIGITAL REVOLUTION IS ALREADY HAPPENING! Key ICT Trends Impacting the World

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THE DIGITAL REVOLUTION IS ALREADY HAPPENING! How ICT Trends Impacting Malaysia

Global

Technology

Business & Govt.

Consumer & Society

A

D

C

B

Rise of

broadband and

mobile

connectivity

77.9% per 100

households

Growing

Cyber

Crimes

375 case reported to MCMC

Smart

cities

Rise of OTT

and social

media Services for Transportation

https://www.grab

.com/my

Smart Community Districts Kemaman

Lundu

Kota Belud

Putrajaya

Langkawi

Smart City Nationwide

An Innovative Bike and Car

Messenger Courier

Delivery Service

www.airbnb.com

Services for people to

rent lodging

141.6 % per 100 inhabitants

Broadband Penetration

Nusajaya

Cyberjaya

Melaka Green

City

Cellular Phone Penetration

76.8 % per 100 households

Pay TV Penetration

Source :

Communications &

Multimedia

Facts and Figures - Q3,

2016

(2014) 453 case reported to MCMC

(2015) 707 case reported to MCMC

(2016)

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Essentials for Digital Revolution

Deployment of Broadband Networks

ESSENTIAL #1 : ESSENTIAL #2 :

Use of Sensors, Smart Devices & IoT

ESSENTIAL #3 :

Digital Services

smart city/smart community requires communications/ broadband infrastructure

Wired and wireless broadband networks - a backbone for ensuring high-speed access to the Internet

Installation of sensors and smart devices as intelligent solutions are facilitated by High Speed broadband

Cohesive and integrated IOT ecosystem for smart city - comprises of connected systems, sensors and smart devices

Digital services provide the enrichment in making a city smart

Importance of access to digital services by citizens – enhance convenience & efficiency that promotes better quality of life

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Policy Statement – 11th Malaysian Plan

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Policy Statement : Digital ID

• MCMC has been given the regulatory mandate to lead the implementation of Digital ID in Malaysia

• Digital ID, a way to authenticate the identity of a person to ensure secure online transactions

• Privacy and security concerns are main factors stopping people from transacting online

• To tap the vast potential of the internet economy, the trust deficit faced by internet users need to be addressed

Physical identity enables

face to face transactions

The internet economy is

changing

the way identity

transactions occur

Digital identity addresses trust issues &

ensures security and privacy for its users

Source : A Blueprint for Digital Identity , August 2016, World Economic Forum (WEF)

PM

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Source :16th NPAC Meeting,BNM

MCMC encourages the industry in

its mobile payment initiatives in

support of the national targets set in

the Financial Sector Blueprint.

E-payment targets in BNM’s Financial Sector Blueprint 2011-2020 (FSB)

E-payments per

capita

Payment Indicators 2011 2015 2020

Target

44 80 200

Cheques cleared

(mil) 205 149 100

Payment card terminals

(per 1,000 inhabitants) 7 9 25

Debit card transactions

per capita 1 3 30

BNM through its Financial Sector Blueprint

envisages Malaysia as a cashless society

Policy Statement : Towards a Cashless Society

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Enabling the Digital Economy – Required “Digital Utilities”

Enables access and sharing of data

and info

Ensures unique user authentication

and verification

Sets up national digital payment standards

Essential infrastructure for the digital economy

Source: Monitor Deloitte

Core Technologies Networks (Cellular, broadband)

Devices (PC, Mobile)

Data Layer Open Data and APIs Cloud

Trust and Safety Layer Digital Identity (ID) Encryption and

Security

Cashless Layer Electronic Payment

Interfaces

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• TRUST is a critical part of the Digital Economy

• Without consumer trust, most of the trillions of

dollars of social and economic value promised will

not be realized Source: Accenture Strategy 2016

In 2020, Digital Economy is forecasted to

contribute about 25% of the overall Global

Economy

The Digital Economy holds huge potential, nevertheless establishing Trust is critical in this equation

Source: Internet Society.org, June 2016

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Unlock car from car sharing

pool using trusted digital

identity on mobile device

Use as mobile key 6

Update central govt. database

with new home address

Maintain personal information 9

Use secure digital mailbox for

communication with government

Communicate securely 1

Sign contract online

using trusted digital

identity

Digitally sign contract 8

Sign into secure video chat to

remotely consult a physician

Consult physician online 2

Get immediate cash

reduction at super-

market checkout

Receive entitlement 7

Electronically vote in city

mayor election

Vote online 3

View tax report on tablet

and send clarifying

questions

Edit tax report online 4

Source: BCG analysis

Trusted digital identity as center-piece of everyday life

Conduct comprehensive financial services

activities from managing receipts to investing

Conduct banking and investment activities 5

Access MOOCs and

attend live lectures

online

Learn online 10

Trusted Digital Identity is a Key Enabler for Digital Services and Digital Vertical Transformation

Source: Goldman Sachs Global Investment Research

The IoT Landscape

A few years ago, the microchips needed to enable data collection and wireless communication were cost-

prohibitive

Today, these microchips are more

cost-effective and are commonly

used in connected devices

Which in turn presents a

Privacy Challenge for

Regulators

Each new device in the age of the IoT presents

significant challenge to a regulator’s ability to

keep citizens’ data secure

Privacy Challenges: Internet of Things (IoT)

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Key Takeaways

National agenda and strategies are the key contributing factors to catalyse the growth of digital revolution

Government is willing to spend to support massive plans for communications infrastructure development which currently is in progress for rural and urban areas in Malaysia

Digital Revolution is here to stay with advancement and innovation in technologies

Policy and new regulatory framework plays an important role to guide on the way forward to achieve Smart Digital Nation and Cashless Society Agenda in Malaysia

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Consumers participation in the digital services depends on the level of trust that secure and protect their identity and transactions in the cyberspace 5

Thank You

[email protected]

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