This article first appeared in The Edge Malaysia Weekly on October 19, 2020 - October 25, 2020

To prepare for her term exams online in June, 18-year-old Veveonah Mosibin built a makeshift wooden platform on a tree top complete with a mosquito net — for better WiFi. Deciding to make a challenge of her rather unusual attempt to get decent internet connectivity, the Universiti Malaysia Sabah student opted to stay up the tree for 24 hours, equipped with exam supplies, power banks, insect repellent, food and water.

While many lauded her ingenuity, her circumstances inadvertently unearthed the bitter truth of the divide that exists between urban and rural areas in terms of connectivity levels. Although official statistics indicate that 90% of households in the country have internet access and almost 100% have access to mobile phones, connectivity is something the Sabah native (Veveonah hails from Kampung Sapatalang in Pitas) and many others living in the most remote parts of Malaysia have to actively hunt down.

According to the Department of Statistics, household internet penetration increased from 87% in 2018 to 90.1% in 2019 and yet, the government — the Malaysian Communications and Multimedia Commission (MCMC) specifically — has been unable to narrow the gap between underserved areas and the rest of the country.

Xair group of companies managing director Nor Zachy Fernandez says the root of the problem lies in the loophole provided when the government awards spectrum to telecommunications operators. According to Nor Zachy — who provides telecommunications consultancy services in various fields, including new rollouts or enhancing current networks — when the government awards spectrum to an operator, it specifies that the operator must provide connectivity to 95% of the population, not 95% of the geographical area.

“Because the rural areas contain only about 5% of the population, the operators have the flexibility of not covering these areas. It is their prerogative and you can’t do anything about it,” he says.

But all communications licence holders (except those with a Content Applications Service Providers licence) that make more than RM2 million a year have to contribute 6% of their “weighted net revenue” to a Universal Service Provision (USP) fund, which is administered by the MCMC. This money is supposed to be used to enhance rural connectivity. But 17 years after the fund was introduced, there are still blind spots throughout the country.

The MCMC tells Digital Edge in an email interview that there was a whopping RM9.4 billion in the fund at the end of last year. Of this, RM3.7 billion had been committed to ongoing projects tendered earlier and another RM5.5 billion was planned for upcoming projects.

Has the USP fund been employed in the most effective way possible? edotco Group Sdn Bhd, which builds and maintains telecommunications towers, does not think so. In emailed replies, it says that despite the fund having been in operation for so many years, it has not achieved the main thing it set out to do, which is to bridge the digital divide.

“To meet its overall aim while easing our journey towards a more advanced and connected society, the policies around Universal Service need to be refined as it is currently stuck in its original framework and there is a lack of proper governance of the USP fund,” the company adds.

It says global studies have indicated that most often, a significant portion of USP funds are not fully utilised or distributed from the levies collected. edotco Group suggests that infrastructure be a focal point of Universal Service policies.

“Infrastructure is crucial in the provision of communications services, even more so in unserved and underserved areas. Tower sharing enables mobile network operators to have a wider dispersion of service while reducing costs to operators and remaining affordable,” it says.

The company also thinks the government needs to expand the design of the Universal Service policy. “Include service providers of new technology and the full spectrum of connectivity such as 3G, 4G, 5G and beyond. Mobile networks that are using such progressive wireless data services are integral to the delivery of service and a nation’s digital economy,” it says.

It also takes issue with the quantum that service providers are expected to contribute to the fund. “The contribution rate by ecosystem players should not burden operators and should not add to the build-up of excess funds in the Universal Service fund. A contribution rate of 1% to 2% of service revenue is in line with global best practices and, in fact, tower and infrastructure companies should pay a lower contribution rate based on their wholesale rather than retail provision of services.”

Coverage in many rural areas is spotty at best. Sabah Creative Economy general manager Viviantie Sarjuni lives only 15km from Kota Kinabalu but describes her connection as “Chipsmore”, as in “now you see it, now you don’t”.

“I remember when I first went to the office after the lockdown, I had a lot of Zoom meetings but the platform kept kicking me out. I was having a meeting with the United Nations over Zoom and got kicked out. When I got back on, I heard them say, ‘That’s why lah, it’s Sabah.’ And I wondered, why are we letting this happen?”

Viviantie, who was formerly with the Malaysian Global Innovation & Creativity Centre (MaGIC) in Kuala Lumpur, has been tasked with pushing the agenda of innovation and creativity in Sabah but she found that one of her major challenges operating out of the state was poor infrastructure.

Sabah.Net — a local internet service provider which, according to its website, connects the state government, business sector and general public — declined to comment. It said in an email reply that it was not responsible for rural connectivity in the state, meaning that it is absolved of the hardship caused to Veveonah and her ilk, but not of the poor connectivity in the capital.

When Fintech Lab executive director Baiza Bain was asked to go to Kota Kinabalu to spearhead the Technopreneur Development Programme and help 10 rural entrepreneurs with their digital transformation, he had no idea how big a challenge simple infrastructure would be. The programme — sponsored by the Malaysian Automotive, Robotics and IoT Institute (MARii), an agency under the Ministry of International Trade and Industry — proved to be a real eye-opener.

“In my experience, when developing rural entrepreneurs in Sabah, the connectivity hurdle was the hardest to overcome. These entrepreneurs were very dedicated and diligent in embracing digital knowledge, but the application of such knowledge was made impossible when they could not get a stable internet line in their villages. For these rural entrepreneurs to successfully scale up, connectivity is key,” Baiza points out.

Viviantie recognises the shortcomings in the state and has started conversations among the ecosystem players to build their own digital blueprint, taking into account local challenges, which may differ from the rest of the nation.

The situation seems to be very different in Sarawak. Its leading telecommunications infrastructure provider, Sacofa Sdn Bhd, has more than 1,800 telecom towers and over 10,500km of terrestrial fibre-optic cables in the state. It says in an email interview that it has fiberised more than 700 towers, enabling retail operators to provide high-speed broadband services.

“This is part of the company’s mission to expand its telecommunications footprint in rural areas,” it says, adding that it is working with federal and state authorities, including MCMC and the Sarawak Multimedia Authority (SMA), to help telecommunications retail service providers achieve their desired coverage targets, especially in rural areas.

“Some of the government initiatives and projects that Sacofa actively participates in are SMA’s plan to build 300 new towers in rural areas and MCMC’s T3 USP.”

It is not that things are any less challenging in Sarawak. With 2.8 million people populating a land area of 124,450 sq km, the state has a low population density, with rural communities scattered across remote areas.

“The lack of basic amenities such as roads, water and commercial power supply in some of these areas has given rise to some of the challenges Sacofa faces when deploying telecommunications in such places. The lack of surfaced roads to these remote areas leads to inaccessibility,” it says.

Because of the low population density and low demand, it is not economically viable to deploy fibre to these areas, it points out. “Therefore, we seek alternative solutions such as wireless transmission and VSAT to extend services to remote areas.”

A VSAT or a very-small-aperture terminal is a two-way satellite ground station with a dish antenna that is smaller than 3.8m.

Sacofa says if a community does not have access to the electrical grid, it utilises alternative sources of power such as a hybrid of solar and diesel generators, which are costly. “Furthermore, land in rural areas is usually privately owned, therefore there is the added challenge of seeking, identifying and renting the land to build towers.”

Because of all this, it can cost twice as much to develop and maintain telecommunications infrastructure in these “geographically challenging” regions. However, the company soldiers on and is now working on projects in Mulu, Murum and Long Urun.

Sometimes, there can be low-cost solutions to these connectivity problems. In Veveonah’s village, the people have come up with the idea of hoisting mobile phones on bamboo poles after turning on their “hotspot” function to allow all in the vicinity to piggyback that phone’s coverage. A YouTube video of the villagers in Pitas doing just that has gone viral.

It is a very creative, low-cost way of solving the connectivity problem but Nor Zachy points out that the mobile phones in this case serve the same function as operator-independent wideband repeaters. “In the West, if you own a building and don’t have coverage in the building, it is up to you to improve coverage. So, you install operator-independent wideband repeaters in low coverage areas such as the basement carpark,” he says.

Nor Zachy says what the villagers in Pitas have done by hoisting their mobile phones on bamboo poles mimics the function of a repeater. “This way, they don’t have to wait years and years for operators to bring in their services. It’s not like they are utilising the spectrum to transmit their own personal data from point A to point B. They are just enhancing the operator’s spectrum to use its service in their area. And this is only considered illegal because the MCMC deems it so.”

The MCMC, however, claims to be protecting the end-users. “Installation of towers and apparatus, including repeaters, is licensed and regulated under the Communications and Multimedia Act 1998. It involves the elements of technical standards and spectrum assignment, which need to be efficiently managed to prevent sub-standard quality and interference,” it says.

“The rationale for such licensing is to protect end-users. Wrong use of equipment can cause service disruptions, impacting many end-users. Further, unlicensed equipment can cause unwanted health exposure to the public near the equipment if they are exposed over a prolonged period.”

The idea of repeaters keeps coming up in conversations with technology leaders on how to solve the connectivity problem. After the Veveonah incident, NanoMalaysia Bhd CEO Dr Rezal Khairi Ahmad brainstormed with some of his colleagues and partners and came up with the idea of putting repeaters on solar- or hydrogen-powered drones to circulate in rural areas, pulling the transmission from nearby telecommunications towers.

“The telecom towers are on hills and the problem is that because of trees and things like that, many villages are in the hidden zone. So, what we propose is to deploy drones as the primary repeater. We already have the drones; what we need to do is place repeaters on them, to allow the signal to be bounced to those areas that currently don’t get any coverage,” he says.

These drones would come with their own energy storage system using either hydrogen or solar energy (or a combination of both) to keep them powered. “The repeater wouldn’t take up much energy as the primary transmission would be from the telecom towers nearby,” Rezal explains.

This, he adds, would be a low-cost solution to help bridge the current digital divide. It would give users access to only basic services such as online banking and e-commerce, but that would be enough to address their entrepreneurial needs and allow them to go global.

Another solution (for addressing rural connectivity in Peninsular Malaysia) would be to use networks that are already available. For instance, not many are aware that Tenaga Nasional Bhd has about 12,000km of fibre-optic cables and power lines connected to about 9.2 million customers across the country. Would allowing the power company to provide services using this infrastructure address some of the problems of rural connectivity?

The MCMC doesn’t think so. “Having fibre-optic cables across the country is not the only component in building a telecommunications network. It requires a full set of operating systems to provide a full-fledged telecommunications service to its clients or end-users.

“MCMC is always engaging with all licensees to guide them to reduce duplication of investment that is not beneficial to the companies or the nation. The country and end-users would benefit more should there be more service-based competition.”

Here too, NanoMalaysia’s Rezal — who used to work for TNB ICT and was involved in migrating its fibre-optic system from an older system (chronous digital hierarchy) to a newer one (synchronous digital hierarchy) — weighs in. “TNB’s fibre-optic cable is a ready infrastructure that is under-exploited. This alone opens up a huge immediate possibility for those who are close enough to a substation. You just pull the cable, install the repeaters and transmit all your digital signals.

“For the kampungs that are close to these lines, you can extract those signals in a much more cost-effective way. All they need to do is partner with a digital service provider and they have greater digital coverage, at least in Peninsular Malaysia. We’re not even talking about low-hanging fruit here; we’re talking about fruit that is already on the ground.”

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