KUALA LUMPUR: Malaysia’s broadband revenue will grow faster than its Gross Domestic Product (GDP) growth rate over the next three years, according to IDC, a global provider of market intelligence for the information technology, telecommunications and consumer technology markets.

In a statement today, IDC said its findings show that the yearly growth rate of Malaysia’s broadband revenue is set to be at 16.1 per cent in 2009 from 2008, and at 15.5 per cent in 2010 from 2009, which should surpass that of the nations average GDP yearly growth rate of six per cent between 2008 and 2010.

For 2008, IDC reports a forecast of broadband revenue totalling RM1 billion, equivalent to about 0.2 per cent revenue contribution to the nations forecasted GDP of RM534.7 billion.

In the following two years, IDC projects that Malaysias broadband revenue will progressively increase its contribution at about 0.2 per cent a year to the GDP.

In 2009, Malaysias broadband revenue is projected to be RM1.2 billion against the nations forecasted GDP of RM566.8 billion, and in 2010, the forecast of broadband revenue is at RM1.4 billion against the forecasted GDP of RM600.8 billion.

Lincoln Lee, IDCs Telecommunication Research Manager for Malaysia, says: “Although the forecasted percentage contribution of broadband revenue to GDP may seem relatively small, we still see this as a positive sign.

“Potentially, we are looking at an enormous ripple effect – the continuous climb in broadband revenue will stimulate growth in other IT sectors such as e-commerce and PC sales.” He said it is highly possible for the growth rate of broadband revenue to increase further, with the rise of PC (personal computer) penetration in Malaysian households, the imminent launch of WiMax services as well as the government’s investment in high speed broadband services.

However, he said, despite these potential market drivers, IDC will remain conservative in its forecast until there is concrete deployment of WiMax and high speed broadband services.

The need for broadband services will very soon “creep” out to non-urban areas, especially through the younger generation, as they begin to enter tertiary education or the workforce, he felt.

According to IDC, within the forecast period, ADSL (Asymmetric Digital Subscriber Line) will remain the largest contributor towards the growth of local broadband services because of its low equipment pricing and proven reliability.

Malaysia, as well as most other nations, remains largely an ADSL country, but emerging technologies like WiMax, Mobile Broadband and Metro-Ethernet services are starting to establish a foothold in the industry, it said.

IDC foresees that it will be a challenging three years before mass adoption of these technologies and believes that the crucial driver of broadband adoption is user-relevant content.

Currently, user-contributed content such as blogs and home videos are driving broadband consumption.

— Bernama