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MCMC to set up RM20m fund for 3G content development

The Malaysian Communications and Multimedia Commission (MCMC) will set up a mobile content development fund, believed to be around RM20 million, next year to drive 3G usage in the country.

MCMC’s head of corporate communications, Adelina Iskandar, said the regulatory body intended to set up the initiative to spur the growth of content development that was more relevant to users. c

“The 3G market needs a ‘killer application’ to get it moving. For the handphone, the killer application is short messaging service (SMS) but there is nothing like that for 3G at the moment,” she said.

Adelina told FinancialDaily the initiative would be launched next year after the fund size and the mechanisms of the initiative were determined.

However, an industry player said the MCMC was looking at an allocation of some RM20 million for the fund.

“The 3G market is sluggish and this will help. We need something besides ringtones and wallpapers. We need better applications,” he said.

Both the active players in the 3G market, Celcom (Malaysia) Bhd and Maxis Communications Bhd, have launched their respective initiatives to encourage users and IT graduates to develop mobile content.

As of October, Maxis has 200,000 3G users while Celcom has said in previous reports it would likely exceed its target of 150,000 users by year-end.

Industry analysts do not expect to see a spike in 3G usage next year, even with 3G handset prices falling to the RM600 range.

“There is no guarantee that MCMC’s initiative will develop content that will get the 3G market moving.

“But the bottomline is that they are developing content and have to keep developing,” one analyst said.

Another analyst said the move by MCMC was encouraging but warned it would still take some time before Celcom and Maxis begin to see a return on their investments.

Collectively, both telcos are estimated to have invested at least RM500 million so far on 3G.

“It will still take two to three years before the telcos see any returns from their investments in 3G even if a killer application is developed next year,” one analyst said.

Celcom’s chief executive officer, Datuk Seri Shazalli Ramly has said the company estimated it would see a return on its 3G investment within three years while Maxis has said returns could be realised in the second half of 2008 at the earliest.-theedgedaily

About Kugan

Kugan is the founder of MalaysianWireless. He has been observing the mobile industry since 2003. Connect with him on Twitter: @scamboy