The government expects this potential plan to boost competition in the domestic 5G market
The government of Malaysia plans to introduce a second 5G network from January next year, in a move which seeks to boost competition in the local telecom market, Reuters reported, citing sources with knowledge of the matter.
According to the report, a proposal on this plan is expected to be submitted to the cabinet this week.
Last year, former Prime Minister Muhyiddin Yassin had unveiled an initiative for a state-owned vehicle to own all 5G spectrum, with various carriers using the network infrastructure to provide 5G services across Malaysia via wholesale or MVNO arrangements.
However, Malaysia’s 5G roll-out by state agency Digital Nasional Berhad (DNB) had raised concerns over pricing and transparency, as well as worries that a single state-run 5G network would result in a nationalized monopoly.
Due to these concerns, the new Malaysian government had announced that it would be reviewing the rollout of the national 5G network. The new prime minister Anwar Ibrahim had said that these plans will be revised due to the lack of transparency.
The Malaysian government is expected to announce its decision on the role of DNB in the short term, according to recent press reports.
A recommendation by the country’s main carriers for the deployment of a second 5G provider was rejected by the previous government in March last year.
Local carriers CelcomDigi, Telekom and YTL had agreed last year to take up a collective 65% stake in DNB, with the government holding the remaining 35%.
Rival operators Maxis and U Mobile had declined to take up equity in DNB. U Mobile later signed an agreement to access DNB’s 5G network, while Maxis has said it will wait until the government review of DNB is fully completed in order to take a decision.
DNB previously said that its 5G network has achieved almost 50% coverage of populated areas with some 3,900 sites at the end of 2022. DNB is now focused on delivering the committed target of 80% of the country’s populated areas by the end of 2024. The company’s 5G network currently reaches some 15 million people and will reach 30 million once fully deployed.
According to a recent report by Singaporean investment bank UOB-Kay Hian, DNB could potentially select a second vendor for its 5G network.
The report revealed that DNB isn’t exclusively committed to Ericsson, which was selected in July 2021 to build DNB’s national 5G network. The report also suggested that there could be a provision in the contract related to the introduction of a second network provider—which opens the door for vendors such as Nokia, Huawei or ZTE to get involved in its 5G rollout plans.