Impact of New Technology
The Way Forward
The nature and structure of the Malaysian postal services industry is changing as a result of new technology, commercialization and increasing pressure to attain profitability and efficiency.
Rapid technological development and the enactment of cyber-legislation have greatly affected the information and communications sector. The ensuing trends, challenges and opportunities mean that the postal service's main purpose is no longer the delivery of letters and documents. It is now expected to be a total distribution provider offering express delivery, hybrid mail, secured messaging and integrated chain services.
Under the Postal Services Bill 2001, the Malaysian Communications and Multimedia Commission (MCMC) regulates the postal services industry. The MCMC aims to enhance and develop the industry by taking advantage of the availability of advanced digital technologies. The MCMC recognizes the impact of new technology, and while intending to take advantage of the opportunities created by electronic commerce, it wishes to ensure that the postal services industry successfully tackles the threats posed by electronic communications.
The key functions of the postal services industry are communication and the transportation of goods. The industry also plays an important role in offering basic financial services, especially in remote areas. Of these key functions, the greatest direct impact of new technology is on communications. The convergence of telecommunications, broadcasting and media has revolutionized the way in which people communicate. Digital technology is superseding the traditional postal service as the new primary delivery platform for communications, significantly shrinking the latter's role.
Communication via the Internet (ie, emailing) is replacing communication via postal services. Besides the advantages of speed and cost, email has the advantage of mobility, enabling persons to send and receive mail worldwide. With customers of the postal service increasingly turning to the Internet, services offered by the post office for the purpose of communications are likely to decline with an inevitable effect on revenue. Furthermore, the increase in personal computer ownership, together with the growth of bandwidth, is likely to result in financial transactions (eg, the payment of utility bills) being carried out online. A reduction in the demand for the postal service's payment facilities is a real possibility.
However, the growth of electronic commerce also has a positive impact on the industry. For example, consumers are now buying goods from online stores instead of retail stores, thus boosting demand for the delivery of packet and parcel mail.
The government is taking steps to enhance and expedite the development of the postal industry in order to meet increasing competition, customer demands and technological change.
Existing postal regulations, which are based primarily on the Post Office Rules 1947 and the Postal Services Act 1991, are archaic and largely focus on the regulation of a traditional monopolistic postal service. The government is keen to ensure that the postal industry's primary laws, rules and guidelines both reflect international best postal practice and promote the use of digital technologies.
With the expected increase in packet and parcel mail, the government intends to review the postal industry's transportation and delivery functions to ensure that the increase in demand is met and to cater for the many business opportunities created by the postal industry in the new economy, which include:
- the transportation and delivery of goods and merchandise purchased online;
- the delivery of hard copies of documents generated from e-commerce transactions; and
- the post office being appointed as payment agency for goods purchased online and for cash on delivery services.
The new technology entails fundamental transformations to the way in which individuals communicate and carry out commercial transactions. Thus, it is crucial for the government to take action to enhance and develop the postal services industry for the internet age.
For further information on this topic please contact Joanne Jacinta Oei at Zaid Ibrahim & Co by telephone (+603 257 9999) or by fax (+603 254 4888) or by email ([email protected]).