Smartphone rebate turnaround: MCMC hung out to dry?

  • The MCMC gave us some solid reasons on why there was a need for a price-cap on the smartphone rebate
  • But even as the industry regulator was ably defending its scheme, the Government did a backflip and removed it

Smartphone rebate turnaround: MCMC hung out to dry?IT is not every day that I have to publicly admit I was wrong, so mark this day, folks.
A little more than a week ago, I wrote a scathing piece about the Malaysian Government’s decision to put a cap of RM500 on the price of smartphones that would come under its RM200 rebate program announced last September for Budget 2013.
This was the final nail in the coffin, for most of us here at Digital News Asia (DNA) were against the rebate in the first place, which will cost the Malaysian tax-payer RM300 million that would be better spent upgrading infrastructure and broadening access to the Internet for all the economically-disadvantaged in the country, not just 1.5 million citizens who just happen to be between 21 and 30 years in age and who earn a monthly salary of under RM3,000.
[RM1 = US$0.33]
The RM500 price-cap came out of nowhere, and the track record of the Najib Administration made me suspicious that there was some element of cronyism involved, a feeling fueled by the 1Malaysia branding – Prime Minister Datuk Seri Najib Tun Razak’s expensive and expansive populist campaign – that dominated the messaging used for the smartphone rebate, or the so-called Youth Communications Package (YCP).
I had wondered how many smartphone models would retail for under RM500, which I felt would cripple the whole idea of getting involved in the Digital Economy via consumer devices.
The YCP would be implemented by seven telcos – Celcom, Clixster, DiGi, Maxis, Tune Talk, U Mobile and YTL Communications – and coordinated by the Malaysian Communications and Multimedia Commission (MCMC), the industry regulator.
I wasn’t the only one who criticized the RM500 cap. The online world reacted with a lot more vitriol and bile, leading MCMC chairman Dato’ Mohamed Sharil Tarmizi to make an impassioned and articulate defense of the scheme and its price cap.
Smartphone rebate turnaround: MCMC hung out to dry?He noted the YCP was aimed at lower-income groups. “We really want to help those who cannot afford to change phones to upgrade from their old 2G phones to a basic 3G smartphone. Those who can afford phones priced above RM500 are really not in the intended category or target market.

“Some of those phones can reach prices of over RM2,500 without contract. A RM200 rebate does not even make a dent, but if the phone is priced at RM500, a RM200 rebate goes a long way,” he noted.
He did not defend the decision to make it available to all youths who earn less than RM3,000 a month and not make the criterion household monthly income, which means that the children of extremely wealthy parents are also eligible, as long as their individual salaries are below the cap. This space for abuse actually strengthened the argument for the RM500 price cap: What young person from such a background would want to be seen lugging around a sub-RM500 phone anyway?
I don’t always agree with the MCMC. I keep wanting it to do a better job of regulating the industry and putting those telcos in their place, especially when it comes to Quality of Service issues and predatory data plan pricing. I see it as my job as a journalist to criticize when I see the need for it – it’s what the Fourth Estate is supposed to do, anyway.
But I have never under-estimated the intellectual capacity and industry knowledge of many of the people there. Sharil’s defense made sense. There were bona fide reasons for MCMC to do it this way. I was proven wrong. I was going to have to eat humble pie.
Then the Malaysian Cabinet decided to do a flip-flop and remove the RM500 price cap.
The Government would have us believe that it listened to the people, but independent news portal The Malaysian Insider noted that component parties of the ruling coalition, the Barisan Nasional, had also pressured the Administration.
For once, I wish the Government had stayed the course, no matter how ridiculous some of us may have felt it to be. After all, even after technology and legal experts, industry players and civil advocates had all argued against the enactment of an amendment to the Evidence Act 1950, the infamous Section 114A, the Government stuck to its guns, only flip-flopping on its reasons for the law.
If many felt that the smartphone rebate was a mere election ploy, then Putrajaya’s turnaround on the price-cap certainly reinforces that view. Apparently it’s okay to “listen to the people” when it involves other people’s money, but not when it might engender greater freedom of expression.
And poor Sharil, who fought and defended the YCP so ably, now looks like the bad guy. The guy who sincerely defended a policy many of us were against, and who had solid reasons for doing so despite what the rest of us may have thought, has been upstaged by a bunch of politicians whose vision only stretches to the next general election.
I agree wholeheartedly with the MCMC’s intention need to make the Internet available to a greater segment of society. I still disagree with the need to pump in RM300 million to gift some Malaysians – and not all of them the needy – with relatively inexpensive access to the Internet. I agree with a Government that listens to the people; I disagree with one that only does so selectively, and only when it can score some public relations points – and never when it comes to real issues of governance and democracy.
There are some good people in government; it’s just too bad that politics keeps fouling them up. That’s the price of public service in this country, I guess, where public relations will always trump policy.

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