Malaysia sets up Internet exchange to cut costs

Malaysia sets up Internet exchange to cut costs:

Malaysia launched a national Internet exchange on Dec 15, promising to cut costs and increase download speeds in line with its goal to become a technology hub.

The exchange allows Internet service providers (ISPs) to sidestep dominant phone company Telekom Malaysia, criticised for charging its rivals high fees for using its infrastructure.

"We need to have an efficient, effective and equitable Internet exchange that fulfils the needs of the industry, service providers and consumers," Energy, Water and Communications Minister Datuk Seri Dr Lim Keng Yaik said in launching the exchange.

Currently, local service providers prefer to route Internet traffic through international lines and foreign exchanges because they can be cheaper than services offered by Telekom or the other local infrastructure supplier, Jaring Communications.

As much as 30% of local Internet traffic is being routed to international lines, said an industry source, even though these were slower than going through Telekom or Jaring.

The exchange could cut operating expenses for ISPs by 8% to 15%, said Afzal Abdul Rahman, executive officer of Applied Information Management Services Sdn Bhd, one of the service providers on the exchange.

Seventeen ISPs, including heavyweights Maxis Bhd and Digi Bhd, have been admitted to the exchange. Telekom and Jaring are also members.

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