M'sia to set up own Internet exchange
Malaysiakini
Sep 25, 2006

Malaysia, which mostly sees Internet access through Singapore or US servers, will set up its own exchange to improve connectivity and reduce foreign exchange leakages, a minister said today.

Malaysian Internet users surfing Malaysia-based websites are currently routed via Singapore or even the United States, but energy and communications minister Lim Keng Yaik said that was inefficient and costly for consumers.

"Let me promise you, we'll have our own Internet exchange and all local traffic will be switched locally," Lim told reporters.

"I told them they should be set up by the end of this year. I'm getting all the stakeholders to talk now," he said.

Cost savings

Analysts say Internet traffic within Malaysia is mostly routed through host servers located in Singapore, as it has more international telecommunication cables and operating costs are cheaper.

"We're losing a lot of foreign exchange by redirecting our calls and Internet connection," said Lim, although he could not elaborate on cost savings from setting up a domestic exchange.

The minister said the exchange would likely operate on a non-profit basis in order to provide a service.

"It doesn't matter who owns the Internet exchange - it could be a consortium owning it - but it must be independent and industry-neutral," Lim said, adding past efforts to set up the exchange had been unsuccessful.

The Malaysian Communications and Multimedia Commission, a government agency, is currently holding talks with Internet service providers and telecommunication and fibre optic network companies on the initiative, he said.