Stakeholders, policy and the market for telecommunications services: The cases of Malaysia and Singapore

Since the telecom network is an important resource in every country, telecom policy making can be expected to be a highly political process in which powerful stakeholders vie to influence policy. In Malaysia and Singapore, the primary stakeholders are the dominant political parties, UMNO and PAP, respectively. In both cases, telecom policy and the resultant market structures developed as part of national economic policies that originated in the politics of the 1960s. We discuss the structure of six market sectors: basic services, payphones, cellular telephones, paging, EDI and the Internet. Malaysia's highly competitive markets are the outcome of the goal of increasing Malay participation in the economy without sacrificing economic growth. Singapore's tendency towards monopolistic markets is seen as the outcome of its one-party political system in which the main stakeholder is the class of government workers who form the bulk of PAP membership. In both cases, government's power to decide who will be allowed to participate in the telecom market has led to the emergence of client politics, a trend that can be expected to continue for some time.