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Sunday, May 22, 2011

Truth and Lies about MyEmail

Sulaiman Kamal | 1:19 PM | Best Blogger Tips

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Since the 1Malaysia Email (an e-Government Entry Point Project in the ETP roadmap and henceforth referred to by its URL i.e. MyEmail) project was announced, there has been considerable criticism, controversy and misunderstanding arising from incorrect and false reports and commentaries.

While we have provided the facts, there appears to be certain quarters who refuse to accept the truth, preferring to 'spin' the facts in order to propagate their false assertions and portray the project negatively.

Here, I will detail the MyEmail project comprehensively and transparently in the hope that the public will get an undistorted perspective of the matter.


Web-Stat web traffic analysis

1. What is MyEmail?: Rationale, Concept and Business Model

Every year, the Government and related public agencies send out millions of correspondences to the rakyat such as quit rent notices, reminders to renew licences, assessment bills, traffic summons, EPF and income tax statements, and so forth. The cost of distributing these correspondences runs into millions of ringgit, annually.

Typically, five steps are needed before a correspondence goes out: (1) information needs to be extracted from the database (2) the information is then put into the respective correspondence formats (3) the correspondence is then printed (4) the correspondence is put into an envelope; and (5) a stamp is affixed before it is posted.

The total average cost for this entire process is about RM1.00 per correspondence, including system, paper and ink, and labour. It is easy to assume that the only cost is postage and conveniently forget that there are four other cost components.

In one of the ETP labs conducted in 2010, which included key members from the private and public sectors, and non-government organisations, it was envisaged that by sending these correspondences via email, we will save a lot of money for the Government. Instead of spending RM1.00 per correspondence, we can save about 50 sen, or in other words, halve the correspondence cost.

The cost saving is derived from the free email delivery. The remaining cost of 50 sen goes towards extracting the information required from the database and presenting them in the respective formats. Most agencies do not possess this system, also known as digital bill presentment solution. These two (out of the original five) cost components are not accounted for in the argument on ‘free’ email transport by other providers, espoused by the detractors.

However, it is necessary to ensure high security because the information involves personal data. People want their personal information and data to be kept confidential and secure. Hence, a critical success factor is that the email facility must be highly secure. This requirement is met with the one-time authentication using finger prints with the National Registration Department to ensure confidential information reach only the intended recipients.

It was also agreed in the lab that the project be driven and funded by the private sector so that the Government can enjoy the operational savings without even having to invest in the development expenditure. Hence, the idea was incorporated into the ETP roadmap to solicit private sector response.

Facilitated by MAMPU and GITN, proposals were received from five private companies. A competitive selection process was undertaken to ensure high technical standards and the right business model is adopted at the lowest cost and highest quality. The evaluation team selected Tricubes Berhad based on these criteria.

Tricubes will invest 100 per cent of the capital expenditure (capex) and operating expenditure (opex) required for this project. The Government will spend nothing in terms of investment and operating cost to run MyEmail.

Instead of sending correspondences to the rakyat in physical form, the Government will be able to send these via email and save millions of ringgit. Hardcopy correspondences will still be sent to those who do not have access to the Internet. Nonetheless, the operational savings for the Government will still be substantial. Simulations on four Government agencies alone showed an estimated cost savings in the region of at least RM200 million over 10 years.

Regardless of whether the Government agencies use MyEmail or otherwise, money will be spent to send correspondences to the rakyat. If the agencies use MyEmail, it will be on commercial terms just like paying for any other service. Therefore, it is wrong to say that paying for the service rendered is tantamount to the government financing Tricubes.

This service will be made available and marketed by Tricubes to Federal and State Governments and all public agencies independently. It is strictly voluntary: none of these units are obliged or forced to use the MyEmail facility, regardless of the fact that it will help them save money. As such, the assertion of concessions for Tricubes by all or various public agencies is absolutely baseless.

In addition, Tricubes can also market the same service to private entities, which will subject it to the full force of open competition. In fact, this model is similar to a credit card or online banking operator who has to market its services to potential merchants (both private and public sectors) and card holders or online users. In these models, operators earn their keeps by charging merchants on each transaction while costing card holders or online users nothing in most cases.

As MyEmail is strictly voluntary, its success depends on Tricubes’ ability to secure high percentage of people who accept it and register voluntarily.

Why do we need MyEmail and who benefits?

MyEmail offers a multitude of benefits to various parties:

1. The Government benefits because though it does not spend any money in terms of investment and cost to operate the system, it can save about 50 per cent of the current cost of sending correspondences. In 10 years, the project can save the four agencies used in the simulations at least RM200 million. If more agencies are convinced of the benefits of the service, the potential savings could be higher than RM200 million over the same 10 year period.

Despite having stated this fact, there are a small group of detractors who keep asserting without basis that this project is a waste of public funds. How can this be a waste of public money when not a single sen of public money is or will be spent, while a lot of public money can potentially be saved?

2. By investing up to RM50 million in a secure and efficient email system and value-added services over five years, Tricubes can generate revenue through service charges to the Government, its agencies and private sector clients as well as users of their value-added services. The plain email service is free.

While the Government will spend money for the services rendered by Tricubes similar to other services it uses, the amount spent will be significantly less than what it is current spending.

3. The rakyat benefits because they get a free MyEmail account which also allows effective and secure email communication between the Government and the individual rakyat. If they do not want MyEmail, there is no problem. This is strictly voluntary.

For those who decide to subscribe to this service, they will get their correspondences from the Government instantaneously and will not have to wait for normal mail. In addition, if the rakyat has any query, they can also use MyEmail, if they so choose, to communicate with various Government departments and agencies.

4. Apart from the Federal Government, all State Governments and public agencies could potentially benefit if they decide to use MyEmail.

It should be noted that State Governments under Barisan Nasional or Pakatan Rakyat may choose to use the MyEmail facility, if they are interested in saving public money. If they are not interested in saving 50 sen per correspondence by using MyEmail and instead prefer to spend RM1.00 per correspondence, then they are neither obliged nor forced to use MyEmail.

Conclusion

The majority of Malaysians are keen to know the facts so that they can form their own conclusions. However, regardless of the amount of information we provide on this issue, there will be a small minority that has already made up their minds. Even after we publish these facts, this small group will continue to reject the facts and find ways and means to distort the truth.

We hope that the information provided above, together with the accompanying summary of 10 important facts on MyEmail and Frequently Asked Questions, will help the largely silent majority better understand the context and rationale behind MyEmail and reject the misrepresentations spewed by the vocal minority.

Lies and truth about MyEmail

Lie #1:

The Government is investing RM50 million in this project.
Truth #1:

Tricubes Berhad, a private company, is investing 100 per cent of the RM50 million.

Commentary:

There are a lot of false and misleading reports, articles and comments in the social media that the Government is undertaking the RM50 million investment for this project. These reports are totally incorrect.

This investment for this project comes entirely from Tricubes. The management of Tricubes has committed that they will initially invest RM5.3 million and subsequently over the years, increase the total investment to RM50 million.
The Government is not investing a single sen in MyEmail. This fact has been categorically confirmed by the Prime Minister, PEMANDU and Tricubes.
The onus is on Tricubes to secure the initial and total financing required, either through equity or debt, failing which the commercial failure is entirely theirs.
The people who are bent on portraying this project negatively continue to ignore the truth and refuse to make any correction, and continue to mislead the general public into believing that the Government is investing RM50 million in MyEmail.

Lie #2:

The Government is forcing people to be registered to use MyEmail.

Truth #2:

No one is forced to use it. The service is completely voluntary. People who want to use the service just have to register. If they do not want to use it, they need not register. It is that simple, nothing more than that.

Commentary:

Despite numerous clarifications about this fact, the purveyors of these lies continue to make their baseless assertions. One must wonder why they continue to spread these lies and what their motives are for doing so.

Lie #3:

The Government will use MyEmail to contact the people as a mechanism to win votes.

Truth #3:

MyEmail is owned by Tricubes and not owned by the Government. It has nothing to do with communicating with the public to campaign and win votes.

Commentary:

As with any database (such as those owned by banks, telecommunication companies etc), all individual personal information and data is owned by the individual operators concerned. The use of such information can only be done with the prior agreement of individual operators concerned.

If this myth is to hold any water, then even Pakatan Rakyat state governments can use it a channel to propagate their messages as this service is similarly open to them. Clearly, this is a baseless assertion.

Lie #4:

MyEmail is a waste of public money.

Truth #4:

MyEmail is not a waste of public funds as the Government will not spend even a single sen in terms of investment and operating cost to run the email system. On the other hand, it is estimated that the Government stands to save at least RM200 million over 10 years.

Commentary:

It is easy to assert that sending emails via other providers, sans the authentication process with the National Registration Department which may result in wrong recipients of confidential information, is free. These detractors choose to ignore there are still two out of the original five cost components that need to be accounted for, namely extracting the information required from the database and presenting them in the respective formats.

Lie #5:

MyEmail was ‘awarded’ to Tricubes to rescue a ‘crony’ company belonging to influential people connected with the Government.

Truth #5:

MyEmail was conceptualised as an Entry Point Project in an ETP lab. Tricubes was selected via a competitive process, conducted by MAMPU and GITN, and participated by four other parties.

Commentary:

If anyone has any evidence of fraud and corrupt practices, they should come forward with the evidence.

Lie #6:

MyEmail is the equivalent of a long-term concession to Tricubes.

Truth #6:

MyEmail is neither a concession nor a long-term commitment which binds the Government to use it for all its correspondences to the public.

Commentary:

If there is any company that can come up with a better, cheaper and even more secure email service, the Government and public agencies are completely at liberty to use their services, instead of Tricubes. With such complete independence to choose, how can it be a concession?

10 important facts about MyEmail

1. MyEmail is part of E-Government programme

E-Government is the use of technology to enhance access to and delivery of government services to the rakyat and businesses
It has three strategic thrusts:

* E-counter services

Towards zero face-to-face: 90% of transactions online, 10% in e-forms
Available on all devices (kiosk, PC, monile) at all locations and at all channels

* Paperless government

Replacement of paper with digital archives
Gradual elimination of paper in stages – minutes, presentations, circulars

MyEmail account

Secure with single sign-on channel to all government e-services
Value-added services (e.g. online bill payment, public record searches etc)

2. MyEmail is secure and convenient

?First-time biometric (i.e. finger print) authentication with National Registration Department required, either over-the-counter or at home with purchase of USB finger print reader, using name and MyKad number
Personal identity information such as MyKad number is stored locally and secured by Tricubes Berhad , while email service is powered by Microsoft’s cloud infrastructure

SSL encryption protects transportation of data; additional layer of protection is optional via content encryption using biometrics
Single sign-on for email and value-added services compared to multiple registrations and authentications, duplication of information release, and multiple usernames and passwords on other platforms

3. MyEmail is privately funded
Tricubes will fund RM50 million over 10 years
The onus is on Tricubes to secure the initial RM5.3 million and total RM50 million financing required, either through equity or debt, failing which the commercial failure is entirely theirs

4. MyEmail saves the government money

Simulation on four agencies shows the government can save at least RM200 million over 10 years

Cost per email will not exceed RM0.50 compared to an average of RM1.00 per physical mail

While email delivery is free, RM0.50 cost goes to digital bill presentment solutions (data extraction, conversion and process); this is not accounted for in ‘free’ email transport by other providers

5. MyEmail project is not a concession for Tricubes

Tricubes needs to market and secure contracts from government agencies and private corporations independently

No government agency is compelled to use MyEmail or awards fixed term contracts to Tricubes

Any contract will be negotiated on open market commercial terms

6. MyEmail-type services is not exclusive to Tricubes
??Government agencies can use other existing vendors or other vendors in the future that offers similar services

7. MyEmail sign-up is voluntary/market-driven

??The public makes the independent decision to sign-up for MyEmail or otherwise

??Public acceptance must be based only on merits of MyEmail’s services

8. Tricubes’ selection was transparent and competitive

Five proposals for MyEmail was submitted to the evaluation team comprising officials from MAMPU and GITN

Selection criteria were best-in-practice technology, sustainable business model, track record and security

MAMPU and GITN adjudged that Tricubes met or surpassed these benchmarks

9. MyEmail is not a tool for sending out propaganda

MyEmail is a secure digital channel for communication and e-services between the government, and citizens and businesses

As it is privately-funded and marketed, it can be use by any federal, state or local authority regardless of political affiliation

10. MyEmail is not unprecedented

A similar service in Singapore called OneInBox will be launched in 2012
According to a fact sheet by the Infocomm Development Authority of Singapore, OneInBox allows individuals and businesses to receive correspondences from government agencies in a single and secure platform through the eCitizen portal using their SingPass

The same document also states that OneInBox will offer potential cost savings to agencies by reducing the need for hardcopy correspondences

Frequently Asked Questions (FAQ) about MyEmail

1. If MyEmail is part of the E-Government programme, why is it not a Government initiative?

E-Government is the Government’s vision to promote the use of technology to enhance access to and delivery of Government services to the rakyat and businesses. MyEmail, on the other hand, is a privately-funded initiative that dovetails into this vision and enables the Government to leverage an effective platform without making the upfront investment. This is in line with the ETP focus for private sector to drive economic growth.

2. PEMANDU changed the description on MyEmail from Government initiative to privately funded initiative. Why?

The idea was originally mooted in a PEMANDU-facilitated lab. To avoid the Government from having to fund the investment, it was decided to get the private sector to implement the project. It was always seen as a Government initiative, funded by the private sector. However, based on the initial statement we released, the facts were distorted and MyEmail was projected as being funded by the Government. We amended the description of MyEmail to make this point clear to the public.

3. If it is a private sector initiative, why did the government make the announcement instead of Tricubes?

Since the Economic Transformation Programme (ETP) was launched, the Prime Minister has made five announcements, totalling 72 initiatives under various Entry Point Projects (EPP), with a cumulative investment of RM106 billion. Most of these projects and investments are private sector initiatives. Under the ETP, 92 per cent of the investments are envisaged to be financed by the private sector. The Prime Minister announced MyEmail, as he has been done in the past few months since October 2010, with all the other private sector initiatives to keep the public informed on the progress of the ETP.

4. Why can’t the Government undertake this project instead of outsourcing it to the private sector?

By 'outsourcing' it, the Government will avoid having to invest RM50 million and avoid spending money operating the email system. The Government’s core role is to provide efficient service delivery to the public. It should not get into the business of creating communication and service platforms as it may not necessarily have the core competencies to do so. It is more cost efficient and effective to use best-in-practice platforms offered by specialised private entities.

5. Why was the name changed from 1Malaysia email to MyEmail?

MyEmail is the domain name for the platform and is the correct description. Project 1Malaysia email was the name givien to this Entry Point Project under the ETP lab.

6. Won’t Tricubes Berhad mine the email database?

As with other commercially-owned databases, Tricubes should be able to mine it, provided it does so in line with the privacy laws of the country, and only with the prior agreement of the individuals who have registered as members.

7. Won’t the Government have access to the email database?

The database is owned by a commercial entity and the Government does not have access to it.

8. What is so different about this email platform? Can I not receive E-Government correspondences via other email platforms?

The MyEmail account, which includes a MyKad-based authentication security layer, ensures that Government correspondences reach the correct recipients and reduces incidence of compromised sensitive personal information. Other email platforms may only provide encryption for the transport but cannot rule out mistaken delivery that can compromise sensitive personal information.

9. By paying Tricubes for the use of email platform, isn’t the Government financing the project?

No. The Government pays various vendors for services rendered. This does not mean that the Government is financing those vendors. For MyEmail, Government agencies will pay per use on open market commercial terms. In addition, the Government does not need to fork out additional upfront capital expenditure. It will merely need to pay for services rendered as part of its correspondence expenditure.

10. Tricubes has received project financing from Mavcap and has Commerce Technology Ventures and Mayban Venture Capital (both are GLC-controlled) as shareholders. Isn’t this tantamount to Government financing?

No. Venture capital firms receive investments from various investors and invest the money on their behalf. It is not a form of Government financing. These investments are done strictly on commercial basis and the Government has no involvement whatsoever in arranging any of these financing deal.

11. Tricubes has only raised RM5.3 million out of the RM50 million investment required. Will the Government extend Tricubes any financial aid, maybe in the form of a soff loan?

Tricubes is confident of raising its own financing through internally generated funds and other equity and debt instruments as part of its financial regularisation plan. This is in line with the ETP focus of making the private sector the engine of economic growth.

12. Mavcap has publicly stated that its RM5.5 million facility to Tricubes was not meant for the MyEmail project, contrary to Tricubes’ earlier claim. How is Tricubes’ going to raise RM50 million when it did not secure the initial RM5.3 million required as claimed?

The onus is on Tricubes to secure the initial RM5.3 million and total RM50 million financing required, either through equity or debt, failing which the commercial failure is entirely theirs.

13. Why does the Government select a company in financial distress to undertake the project?

MAMPU and GITN’s selection criteria were best-in-practice technology, sustainable business model, track record and security. MAMPU and GITN adjudged that Tricubes met or surpassed these benchmarks.
They have also clarified with Bursa Malaysia that a GN3 status can affect Tricubes’ listing status but the company is not prevented from conducting business as usual. It is able to execute business projects, its financial statements are properly drawn up and all its debts and financial obligations are up-to-date.

14. What about the other contenders?

MAMPU and GITN’s selection criteria were best-in-practice technology, sustainable business model, track record and security. MAMPU and GITN adjudged that Tricubes met or surpassed these benchmarks.

15. What happens if Tricubes fails to deliver?

Like all private sector projects, if the enterprise fails to deliver, it will lose its investment.

16. Will the Government bail-out Tricubes if the business fails?

No. In a private sector-driven economy, there will be businesses that succeed and others that will fail. The Government must allow free market to operate and not bail-out failed businesses, save for critical national interests.

17. Why should Government agencies pay up to RM0.50 per email when it can send emails for free on other platforms? How can it be considered as savings?

Government agencies currently pay up to RM1.00 per mail and even RM2.00 for each returned hardcopy correspondence. This is the cost for data extraction, conversion and process, document generation (paper and print), sorting and enveloping and distribution.

When you use the MyEmail platform, you only need to pay for data extraction, conversion and process, which cost up to RM0.50 per email, and if necessary, biometric encryption, which may cost more.

Arguments that such correspondences can be sent free on other email platforms on takes into account the email transport, without considering the cost for data extraction, conversion and process.

Hence, there is real savings of almost 50 per cent per email should government agencies use MyEmail. However, final terms of usage is subject to open market commercial negotiation between the agencies concerned and Tricubes as the former can choose other vendors or traditional mail.

18. How can an email platform be a sustainable business model?

The email platform is part of the business model where senders are charged on pay per use for bill and notice presentment, and users are charged for value-added services. It is a feasible business model.
19. Why do we need MyEmail when you already have MyEG?
MyEmail and MyEG are not alike as the latter is purely a payment portal without a single sign-on authenticated email platform.

20. How can sign-up be voluntary when Tricubes’ has a KPI to get 100% of Malaysians aged 18 and above signed up by 2015?

Tricubes put a KPI of 100 per cent sign-up as a target and aspiration though it is voluntary. There is nothing to prevent businesses from putting stretched targets.

As with any project, public or private, there must be KPIs for performance monitoring and accountability. Tricubes decided to adopt the stretched targets set by the CCI NKEA. It does not mean that Malaysians will be compelled to sign on or assigned the service unilaterally.

21. What is the Government’s role in this project?

The Government’s role is to facilitate the project implementation of MyEmail such as ensuring cross-agency coordination and monitoring its implementation progress based on set KPIs.

21. Why has PEMANDU defended Tricubes so vigorously in public?

PEMANDU tries to put out timely and accurate information for public interest. Tricubes has also issued two statements, one Q&A document, held a media briefing and engaged with various media. The reason why we are clarifying this situation is to make sure that the general public is not misinformed by people who distort the truth. PEMANDU believes in integrity and transparency.

22. Why will Tricubes want to undertake this project in the absence of a concession or business guarantee?

Private sector owners follow the money and if they are confident to achieve profits, they will undertake the projects. That decision is best left to them.

23. If there is another company that can come up with a superior email system that is better, more effective and cheaper, will the Government consider shifting away from Tricubes?

Yes. That is why the Government has not entered into a concession or long-term agreement. For all the information that is given on this project, it is really surprising to find that there is a small group of people who are bent on distorting the truth.

24. Will this detailed information pack resolve this controversy?

Even after we have given the facts and the truth, we are convinced that selected groups who are bent on distorting the truth will continue to do so. However, we are equally convinced that the majority of the public would welcome the facts and that is all we are hoping to achieve with this detailed information.

25. If there is no Government investment, concession or minimum commitment, why was there a selection process?

The selection process is merely an assessment to find out which company would likely succeed in rolling out the email service based on its capabilities. It does not mean that other companies cannot offer their own version of the service. However, overlapping projects could lead to waste of resources and that is why the evaluation team only selected one company

Other parties who are not selected or did not submit a proposal earlier can still pursue the opportunity if they see a viable business case for it.

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