x
Asia

5G might be costly but competition settings still matter

5G is a big lift, especially for developing countries.

Fully deployed it requires a far denser mix of base stations than 4G, multiple spectrum bands and a power load that can be up to three times higher. So it's understandable that governments and operators have been taking steps to reduce the cost. Which brings us to the latest in Malaysia's 5G wholesale saga.

Decisions, decisions

Concerned at the expense and the duplication of multiple 5G rollouts, the government has decided to build a single national wholesale network.

But it hasn't been able to bring the industry along with it. Now we learn operators are calling for construction of a second national wholesale network, Reuters reports.

They reportedly told government officials earlier this week they were unhappy with the pricing and level of transparency of the state-funded 5G deployment. The new network is beginning to offer service in a handful of locations and is expected to go commercial in the first half of next year. But the single network approach is the bluntest tool in the toolbox.

The Malaysian cabinet is due to decide shortly on the 5G plan. It might take quiet note of neighbor Singapore's smooth 5G rollout involving two networks, with the smaller players required to form a JV.

Or it might follow the lead of the Chinese, who have embraced network sharing on a massive scale to build out a mostly urban 3.5GHz network (China Telecom is claiming cost savings of 60 billion yuan ($9.4 billion) and are about to do so in rural areas on 700MHz band.

Come together

It's not just governments that are alarmed at the cost of 5G. Operators are, too, and nowhere more so than in southeast Asia, where a wave of consolidation is underway. Axiata and Telenor have embarked on a $15 billion merger in Malaysia, reducing the number of operators to three.

In Thailand, True and DTAC have signed an $9 billion deal, while in Indonesia the $6 billion Ooredoo Indosat-Hutchison agreement has driven XL Axiata and Smartfren into each others' arms.


Want to know more about 5G? Check out our dedicated 5G content channel here on
Light Reading.


These M&As are more about market over-supply than 5G specifically, but the imminent arrival of 5G has concentrated their minds wonderfully. But let's note that the Philippines, a developing nation poorly served by its telecom duopoly, has actually added a new operator in the 5G era.

As a result of the extra competition, as well as government efforts to slash red tape, capex is up, rollouts have sped up and consumer prices are down. Which should remind us that 5G is no different from any other mobile generation: competition and regulation are just as important as how the underlying infrastructure is built.

Related posts:

— Robert Clark, contributing editor, special to Light Reading

Be the first to post a comment regarding this story.
HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE