Web commerce continues to elude Malaysians throughout
2001 due to the economic slowdown that was further compounded by the Sept
11 terrorist attacks in the US.
Though Internet population is on a steady rise,
purchasing power did not shift in tandem with the online environment. With
the downturn, Web commerce sites that lacked fundamentals collapsed
silently unlike content plays that shuttered with a clang. A check at
Malaysia’s E-Commerce Hub
revealed that 30% of the sites listed were no longer active.
took Malaysians a long time to embrace the idea of automated teller
machines (ATMs) to dispense cash. It will take them longer to warm up to
the idea of buying stuff online and feel assured that it is a secured
environment,” said Via
Communication Network’s CEO
Foo had set up a
portal 18 months ago only to see it go up in smoke. “Users are not all
that ready as we think them to be. Many sooner go to the store than buy
online unless the product and price is compelling enough for them to
Indeed, players in the arena wised up amid the rising
number of dotcom fatalities, choosing to move on instead of dwelling over
spilt milk. Some introduced Web hosting services while others looked
“The consolidation is a natural process of growth
in any industry. As a result, some may cease operations, others become
bigger,” said Aimi Aizal Nasharuddin, executive director of e-business
services provider SKALI.
In retrospect, he
pointed out that Malaysia underwent a radical change shifting from an
industrialised economy to an IT era. “With so many dotcoms mushrooming in
mid-1997, every business was coming out of its traditional shell and
transforming into another dotcom hype, which made the much vaunted
e-commerce more in demand than ever.”
Perhaps the singular factor
that bankrolled many businesses is the National PC Ownership campaign that
kicked off in February 2000, said a local computer vendor. To date, 94,000
out of 124,000 applications have been fulfilled.
statistics show that the current computer ownership rate is eight people
per 100 population. It is expected to double by December and hit 30 by
2005. (The world-class standard is 40.) The PC penetration rate in rural
areas has also gone up by 5% to 35%.
The challenges for the coming
year, said Liew Chew Keat, founder and managing director of local search
engine Cari.com, will be
surviving the global economic slowdown and bolstering consumer
Besides, the government should take another look at
lowering the Internet access cost in order to spur growth. “By pushing the
idea of a flat rate for Internet will help to increase the [amount of] IT
knowledge among Malaysians as a whole. That is not easy to achieve when
every minute online is chargeable,” he added.
Institutions too can
do their bit to push e-commerce without compromising business interests.
For instance, bankers can reduce the deposit required for Internet-related
accounts. “It is completely understandable for a bank to protect their
investments but it does not justify to open an RM50,000 (US$13,161)
account to sell products worth RM50 (US$13). The bank should not hold us
ransom for running our [’Net-based] business.”
Such travails do not
deter long-time players in the e-commerce scene. Even with the 2001 gross
domestic product (GDP) growth forecast which had been revised for the
second time since March--to 1–2% because of the “greater-than-expected”
slowdown in the world economy--the show will go on.