January 22, 1998 (KUALA LUMPUR) -- Malaysia's Multimedia Super Corridor (MSC) project so far raked in US$1 billion worth of investments from 103 local and international technology companies.

This was disclosed at the 4th MSC Implementation Council Meeting chaired by Prime Minister Mahathir Mohamad.

The MSC is a 750-sq.km. area south of the capital city which the government hopes to turn into a global hub for the creation of multimedia content, products and services. Mahathir said the development of the first phase of Cyberjaya, the city within the MSC that has been earmarked to host high-tech companies, is well ahead of schedule.

"Infrastructure development planned for 1999 is in the midst of being completed by the end of 1998, and 50 companies are expected to move in by then," he said.

Cyberjaya is being built from the ground up on 7,000 hectares of land currently covered by rubber and palm oil plantations and secondary jungle.

Mahathir added that besides tax exemptions and guaranteed infrastructure, the government also promises companies operating within the MSC unrestricted access to the Internet and the issuance of multiple-entry visas for foreign staff.

"They will have absolute access to the Internet without any form of censorship, while foreigners (working within the MSC) will find it easier to enter and leave the country," he said.

The development of Cyberjaya is spearheaded by Cyberview Sdn., Bhd., which is owned by a consortium of 12 companies.

Cyberview chief executive officer Abdul Karim Abu Bakar said he is confident of raising 1.6 billion ringgit in financing, despite the current credit squeeze, to fund the development of the 2,800- hectare enterprise zone of Cyberjaya.

Abdul Karim said since its formation the company has been focused on acquiring the land and building basic infrastructure such as roads, water pipes and sewerage. It also is preparing the construction of office and commercial buildings and about 20,000 houses in the first phase, which covers 1,300 hectares.

About 700km of fiber optic cables, the backbone telecommunication infrastructure for the MSC project, already has been laid. Abdul Karim said 28 companies have placed deposits to purchase land at Cyberjaya, which is going for about US$12 per square foot.

Multimedia Development Corp. (MDC) executive chairman Othman Yeop Abdullah said the 103 approved MSC companies comprise a good mix: 35 percent are local, 11 percent from Europe, 10 percent from the United States, 6 percent from Japan and 1 percent from Canada, while the remainder consists of foreign joint-ventures as well as joint-ventures between local firms.

MDC is the one-stop agency set up to promote and develop the MSC.

Othman said the second meeting of the MSC's International Advisory Panel, which advises the government on the development on the MSC, has been set for Feb. 12 and 13.

The high-powered panel, which comprises various luminaries from technology companies such as Microsoft Corp. Chairman Bill Gates, Sony Corp. President Nobuyuki Idei and Sun Microsystems Inc. Chairman Scott McNealy, first convened at Stanford University in California on Jan. 16, 1997.

Othman said the panel has been enlarged to 41 from the original 30, and now includes those in animation and content development.

"We also have invited venture capital companies of emerging technologies to become members," he said.

In analyzing California's Silicon Valley, Othman said one of its success factors was numerous venture capital companies supporting leading-edge research.

"We have 34 such companies in Malaysia, but there is a need for more foreign companies with the experience to come in and identify, assess and fund research that has potential commercial value in order to minimize the risks," he said.

Othman said that among the confirmed attendees for the upcoming meeting are Motorola Inc. CEO Gary Tooker, Madge Networks NV Chairman Robert Madge, NEC Corp. Chairman Tadahiro Sekimoto, Nippon Telegraph and Telephone Corp. President Jun-ichiro Miyazu, Acer Inc. Chairman Stan Shih, EDS Corp. Chairman Les Alberthal, Ericsson AB President Lars Ramqvist and noted authors Alvin Toffler and Ken-ichi Ohmae.

Othman said that on the agenda for the meeting is a review of the current progress of the MSC, its infrastructure, human resource and R&D requirements and various issues on cross-border collaborations, electronic commerce, converging technologies and the societal impact of the Internet.

Othman said three companies committed to invest in the MSC will be invited to make presentations and demonstrations of their products to the panel to emphasize that the MSC is fast becoming a reality and is no longer just a concept.

"We want to convey to the panel members that the government is extremely serious in proceeding with the development of the MSC in spite of the current economic setback in the region," said Othman.

He added the present currency turmoil has only reinforced the need to create new areas of economic activity that can be the future engine of growth and generate renewed confidence in the country.

(Julian Matthews, Asia BizTech Correspondent)