The head of the government-funded Digital Nasional Berhad said the 5G wholesale network plan had been 'inordinately delayed' because of the operators' behavior.

Robert Clark, Contributing Editor, Special to Light Reading

February 15, 2022

3 Min Read
Malaysia 5G network boss blames 'posturing' MNOs for delays

The head of Malaysia's contentious 5G wholesale network has blamed mobile operators for rollout delays and rejected a second network as not viable.

Ralph Marshall, CEO of the government-funded Digital Nasional Berhad (DNB), said the single wholesale network (SWN) plan unveiled in late 2019 had been "inordinately delayed in its implementation as a result of posturing" by operators.

Figure 1: Digital Nasional Berhad began Malaysia's first 5G service in December, well behind Singapore and Thailand, which both launched in 2020. (Source: mkjr_ on Unsplash) Digital Nasional Berhad began Malaysia's first 5G service in December, well behind Singapore and Thailand, which both launched in 2020.
(Source: mkjr_ on Unsplash)

The original plan was to create a consortium of operators to build the wholesale network. However, the plan failed because of a lack of commitment from the telcos and "conflicting interests" between them, according to Marshall.

"There was no urgency in the MNOs to implement 5G as they were content to further sweat the 4G network that they owned and were making substantial returns from," he said.

As a result, "Malaysia continued to slip behind its ASEAN neighbours in 5G rollout," Marshall wrote in a lengthy public response to questions from a member of parliament about the scheme.

DNB began Malaysia's first 5G service in limited locations in December, well behind neighbors Singapore and Thailand, which both launched in 2020.

"As for existing telco operators rolling out the network, if the country had waited for the telcos, the 5G network would likely have been delayed to 2023 or 2024," Marshall wrote.

The single network plan, first announced more than two years ago, has run into resistance from the incumbent operators, who say it will limit competition and their ability to differentiate.

Marshall rejected suggestions that the government issue a second wholesale license, warning that it would threaten DNB's viability (see Malaysian telcos call for second 5G network – report).

Private monopoly potential?

Marshall said it was "highly unlikely" that DNB would survive in its current form if another wholesale network provider were to be introduced.

The failure of DNB would mean that the second wholesale provider would eventually become a private SWN monopoly, while the government would incur legal and financial costs, he added.

Marshall argued that the SWN model was the most efficient way to use the scarce 5G spectrum. The aim was to ease the operators' investment load, accelerate the rollout and address poor connectivity in suburban and rural areas.

The national network would be a utility that would pass on cost savings, Marshall said, complaining that incumbent telcos had shown "it is not in their DNA to embrace a cost recovery model to roll out 5G infrastructure and pass on savings to end-users."

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He said that the 2019 report by an industry task force had estimated the total cost of a multi-network rollout at around RM30 billion (US$7.2 billion).

DNB has estimated a total cost of RM16.5 billion ($3.94 billion) over ten years, funded by commercial loans and only RM500 million ($119 million) equity from the government.

The cost includes RM8.5 billion ($2.03 billion) for network infrastructure such as fiber and ducts, RM4 billion ($1 billion) on the Ericsson-supplied equipment and RM4 billion ($1 billion) in operating costs.

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— Robert Clark, contributing editor, special to Light Reading

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About the Author(s)

Robert Clark

Contributing Editor, Special to Light Reading

Robert Clark is an independent technology editor and researcher based in Hong Kong. In addition to contributing to Light Reading, he also has his own blog,  Electric Speech (http://www.electricspeech.com). 

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