Budget 2010: IT industry's response

Written by The Edge FinancialDaily
Friday, 23 October 2009 21:54

Intel Malaysia's response to the Budget 2010

Intel congratulates the Malaysian government on the unveiling of Budget 2010. Based on Intel’s pre-budget hopes and viewpoint, the following are Intel’s responses to the Budget2010 announcement on the following subjects:

Education
The netbook bundle is a great initiative to ignite computing and broadband adoption among students. Intel hopes that this can be scaled out to student at all educational levels.

Intel had hoped for a stronger integration of ICT in education, particularly to drive learning in and outside of the classroom.

Intel had also hoped to see more allocation for higher-education research and strong collaboration between Malaysian universities and top-ranking engineering schools around the world.


Human capital
Intel lauds the government’s move to simplify the movement of relevant skilled talents to Malaysia.

Information infrastructure
The PC loan for civil servant is a boost towards increasing PC penetration. However a refresh period of three years would make broader economic and social impact.

Instead of a tax relief, Intel had hoped the government would subsidise the cost of broadband access as well as the devices (similar to the netbook package for university students). This subsidy should be targeted at a broader audience especially those outside of the tax net

Intel hopes the 10th Malaysia Plan will help address the need to encourage competition and liberalisation among Internet Service Providers so that broadband cost and quality can be improved.

R&D
Intel lauds the establishment of the National Innovation Centre that will help to promote a culture of innovation and inculcate the value of raising productivity levels. Intel hopes to see higher participation from the public and private sector alike in this initiative.

Health
While having more hospitals is vital, improving the quality and delivery of healthcare services via TECHNOLOGY [] integration is equally important to reach a wider audience. ICT is a proven critical enabler for the delivery of healthcare services.



Bobbi Dangerfield
Managing director, Dell Global Business Center Sdn Bhd

Human capital development
Malaysia's ICT industry is still facing a serious shortage of skilled professionals despite several key measures to tackle the problem. There are a large number of unemployed ICT graduates who do not meet today's industry requirements. This alarming situation is further aggravated by corporate expansions and brain drain to other developed countries that offer far better job prospects and remuneration. There is also a growing mismatch of graduates' expectations and industry needs.

Thus we welcome the allocation of over RM2 billion to higher-education institutions to build human capital that meets market needs. There should be more collaboration between ICT players and local universities to develop industry-ready ICT professionals.

Broadband services
High-speed and consistent broadband service is an issue that continues to affect Malaysia's competitiveness. The quality of service and affordability of broadband needs to be enhanced as it is a key contributor to economic growth. Thus, we applaud the government's announcement on the deployment of 10Mbps high-speed broadband nationwide beginning March next year. This would allow more Malaysians and local entrepreneurs to connect to and participate in an increasingly global and borderless economy.

Universal high-speed broadband connectivity would also certainly help the country towards overcoming the digital divide between urban and rural communities. The move to provide income tax relief of RM500 for broadband subscription is a positive step in this regard. Similarly, the announcement of the netbook package with free broadband service for students at public universities is to be applauded. We hope that the initial packages for 100,000 students will be extended to all students in the near future.

Green technology
As a global leader in providing green technology, we thank the government for allocating RM1.5 billion to promote green technology. The soft loans will help businesses to adopt energy-efficient technologies, reduce overall carbon emissions and move the country towards a sustainable and environment-friendly economy.

Strengthening small and medium enterprises
We welcome the continued priority placed on the SME sector with the allocation of RM350 million for soft loans and capacity enhancement as well as RM538 million for SME development programmes. The allocation would enable SMEs to invest in technology, which can be a key differentiator for SMEs, not only during the current financial crisis but also when planning for the impending economic upturn.



Suzie Tan
Managing director, Malaysia, Symantec Corp

Symantec welcomes Malaysia's Budget 2010 tabled in Parliament today which focuses on being competitive in the global economy through the new economic model on innovation, creativity and high-value-added activities. Symantec believes that this focus will be a strong foundation for the coming 10th Malaysia Plan.

Specifically, Symantec commends the government's continual commitment in this budget to develop a sustainable environment through green technology and to strengthen the ICT Industry through increasing broadband penetration and ownership of Computers.

Green Technology
Symantec welcomes the government's commitment in the development of sustainable environment through green technology. The RM1.5 billion fund to provide soft loans to suppliers and users of green technology as stipulated in Budget 2010 solidifies the government's effort for the development of green technology in Malaysia. The development of green technology can realise reductions in energy consumption and costs, not just for new investments but also through the optimisation of current resources. In fact, the provision comes at the right time, as we believe that Malaysian companies are ready to make such investments.

According to the Symantec 2009 Asia-Pacific and Japan Green IT Report released in April 2009, 92% of Malaysian companies surveyed are expecting green IT budgets to increase over the next 12 months. In addition, 72% of respondents state that they are working on creating a green IT strategy. While these organisations might be the first beneficiaries of the incentives, we hope that the initiative will drive many more companies to adopt similar practices. The funds allocated under Budget 2010 would definitely help companies mitigate the financial burden of going green.

Broadband and computer ownership
Symantec also applauds the government's proposal to provide a personal tax relief on broadband-subscription fees in order to boost the broadband penetration rate in Malaysia. We believe the implementation coupled with computer loans for civil servants would attract a wider base of broadband users, which in turn will promotea more IT-savvy and knowledge-based society that will in turn support the nation's development.

However, as the country gets more connected, Symantec recommends that the government also continue to strengthen the cyber-security framework, as increasing broadband usage will expose users to more risks from cyber threats. As such, we recommend leveraging the public-private partnerships to determine the data-protection legislation structure, national infrastructure and technologies and industry best practices. This will be critical to ensure that we are prepared to provide an environment where businesses and consumers can continue to engage in and benefit from the online world.

SME development
Budget 2010 also highlights that the government will allocate RM350 million worth of funds to SMEs for soft loans, capacity enhancement, branding and promotion. The government's continuous emphasis on developing SMEs is indeed encouraging. The onus is now on SMEs to capitalise on the provisions to enhance their competitiveness, whereby they should also look at using smart technologies as part of their operations.

These technologies should address SMEs' critical concerns, especially on automating key processes that will allow them to be more efficient. Malaysian SMEs have high awareness of security and disaster recovery, but there is still a relatively low adoption of basic IT security and disaster-recovery measures in Malaysia. SMEs could leverage on the available funds to deploy solutions thatwill help SMEs improve cost efficiencies and streamline manageability, allowing them more resources and time to focus on their core business.