Critics Say Malaysia's Rules Stifle Creativity of Software Developers : A Hothouse of High-Tech Ideas? 
International Herald Tribune
January 22, 1998
Thomas Fuller 

A year ago, Darryl Carlton's software company worked out of the back room of someone else's office without any air-conditioning — a sure way to stifle creativity in the tropics.

Mr. Carlton financed the company from his own bank account, mortgaged his house twice and showered his four employees with promises of better times. If this evokes images of Silicon Valley's early days — computer geniuses working out of a garage — Malaysian officials would be flattered.

That is precisely the image the country wants to project: a hotbed of creative thinking, led by quirky Bill Gates-type visionaries.

Mr. Carlton, an Australian who moved to Kuala Lumpur 15 months ago, has 35 people working for him. And his company, Datek Sdn. Bhd., has relocated to a bigger, Valley-esque office, replete with a basketball court, punching bag and high-speed fiber-optic links to the Internet.

But Datek's success doesn't tell the whole story of Malaysia's vision for a home-grown Silicon Valley, a project known as the Multimedia Supercorridor.

The regional economic crisis has left its scars, and not only in the financial sector. Recent months have been cruel to the notion of free-flowing information in Malaysia. The government has pressured financial analysts into not talking with the press, admonished newspaper editors to run positive stories and, on Wednesday, threatened rumor mongers with the punishment of the internal security act: detention without trial.

It is an environment, critics say, that is more stifling than an office without air-conditioning, a threat to Malaysia's ambitious $10 billion "supercorridor" dream.

"The question is whether we can create a culture of creativity — where you can let people have their hair down," says Lim Kit Siang, the opposition leader in Parliament and a two-time detainee under the internal security act. "The whole political culture has to change. If they're incapable of doing it for the economic crisis, it's legitimate to ask whether they're capable of doing it for the information age tomorrow."

The government has responded to such criticism by saying that the supercorridor, a top priority that officials assert is ahead of schedule despite the financial crisis, will be governed by different laws.

"Certain practices in the MSC will defer from the rest of the country," Prime Minister Mahathir bin Mohamad said earlier this week, referring to the supercorridor. "For example, they have absolute access to the Internet — no censorship of the Internet. Those working here will be able to come in and out without too much bother about getting visas every now and then."

But the statement Wednesday by a top official in the national police force, Ghazali Mohamad Amin, illustrated the situation elsewhere in Malaysia. Mr. Ghazali told the official Bernama news agency that "certain groups" were "fishing in troubled waters" by spreading rumors about the price rises in the country and the stability of the banking system. Mr. Ghazali listed three different acts that could be invoked against people who spread rumors, all of which involve jail terms.

Arthur Owen, a telecommunications consultant with Booz, Allen & Hamilton who has worked on supercorridor-related projects, said: "The idea of the corridor is to create a part of Malaysia where there will be freedom of information, copyright laws and an attractive, social and cultural environment."

"But it's not going to be sufficient just to make the infrastructural, legal and societal changes," he said. "It's going to be important also to change the perception of Malaysia in the minds of more creative, high-tech types." - THE Multimedia Supercorridor gets its name in part from the shape of the strip of land chosen for the development. Starting from Kuala Lumpur, the zone is 15 kilometers (nine miles) wide and 50 kilometers long, an area larger than Singapore. Malaysia is luring companies to the bucolic hills of the supercorridor with tax breaks and a ''bill of guarantees'' including liberal corporate ownership rules, intellectual property protection and the right of unlimited importation of foreign workers. More than 100 companies have been granted supercorridor status so far, giving them the accompanying benefits. But Mr. Carlton does not believe they have necessarily overcome the creativity issue. ''Most people who come to the MSC want to try to win Malaysian government contracts, and they use their MSC position in order to get tax breaks on Malaysian projects,'' he said. ''They're really cheating the MSC.'' In fact, several supercorridor companies contacted for this article were reluctant to comment on the record on the issue of intellectual freedoms here, given the political environment. - MALAYSIA is not the only country touting itself as an Asian hub for information technology. Singapore is luring companies with its Singapore ONE program, which aims to connect every household and business on the island with multimedia services. And the southern Indian city of Bangalore offers a vast pool of programmers and computer specialists who can do ''back office'' work for companies in Europe and the United States. Mr. Carlton said he chose Malaysia after ''a very detailed study'' of the region. ''The two most attractive countries to operate in were Singapore and Malaysia,'' he said. ''The cost of setting up a business, running a business and personally living in Malaysia was much lower. That was the final deciding factor.'' Construction of the physical infrastructure of the project — the high-capacity fiber-optic lines, roads and ''multimedia university'' campus — is still under way. Companies will start moving into the actual site of the supercorridor — and the central city of Cyberjaya — once the first phase of construction is completed at the end of this year. But Mr. Carlton of Datek — which sells inventory and customer service software — is not yet eager to move his offices there. ''My staff require other support facilities in order to keep them happy,'' he said. ''Their requirements are very straightforward — restaurants, shops, entertainments, housing. Until those things are in place, it doesn't matter if the roads or the fiber optics are there to support the business. I won't be able to attract the kind of staff I need and I won't be able to maintain a creative working environment that will produce results.'' Mr. Carlton also noted that Malaysian financial institutions had ''no comprehension'' of the value of intellectual property as collateral. ''They don't understand that our production capacity is the talent and experience of our staff.''

Copyright © 2006 the International Herald Tribune