Malaysia’s DNB to offer free 5G services to telcos during initial rollout
Malaysian state agency Digital Nasional Berhad (DNB) said on Monday that it will offer wholesale 5G services to mobile carriers at no cost during an initial rollout set to begin next week, amid concerns from telecom operators (telcos) over its pricing plans. DNB, a government agency tasked with building and managing the entire fifth-generation (5G) telecommunications network, has yet to sign long-term deals with any mobile operator, with telecoms firms raising concerns over transparency and pricing issues, Reuters reported last month.
DNB said 5G services will be commercially available from Dec. 15th in three central areas, including parts of the capital Kuala Lumpur (KL). The free 5G wholesale services will be available to telcos until 31 March 2022, as DNB seeks to finalize its wholesale agreements with carriers. DNB has said it hopes to sign long-term contracts in early 2022.
Telekom Malaysia Bhd on Saturday became the first operator to sign up for 5G trials with DNB. Malaysia’s top telco said it will be participating in the pilot trials in some parts of the capital, Kuala Lumpur, and two other urban centers.
Photo of Kuala Lumpur at night
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Other mobile network operators in Malaysia include: Maxis Berhad (Maxis), Celcom Axiata Berhad (Celcom), Digi Telecommunications Sdn Bhd (Digi), U Mobile Sdn Bhd (U Mobile), Altel Communications Sdn Bhd, Merchantrade Asia Sdn Bhd, Service Providers Service Fixed Broadband Mobile Broadband Telekom Malaysia (TM) √ √ Maxis Berhad (Maxis), Celcom Axiata Berhad (Celcom), Digi Telecommunications Sdn Bhd (Digi), U Mobile Sdn Bhd (U Mobile), Macro Lynx Sdn Bhd, MyISP Dot Com Sdn Bhd, Telekomunikasi Indonesia International (Malaysia) Sdn Bhd (Telin), and several other smaller players.
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A “reference access offer” – a public document that will cover the details of the DNB’s 5G wholesale model, including pricing and service commitments – will be approved by Malaysia’s communications regulator soon following extensive feedback from the industry, DNB said. Operators that sign up to its wholesale plan before March 31 will receive further free access to all additional 5G capacity during the initial period of operation, it said. DNB also reiterated that its 5G pricing plan would be cheaper for mobile carriers than the cost they have incurred for 4G.
Telcos have said under the proposed pricing plan, they could end up paying more than they would have if they introduced 5G on their own, as the plan did not take into account additional requirements related to issues such as traffic volume and contingency costs.
The Malaysian Communications and Multimedia Commission (MCMC) had earlier stated that: “The technical requirement for a 5G rollout is predicated by a strong foundation of 4G coverage and fiber rollout, without which, 5G rollout will not realize the optimal benefits of the new technology…..Rushing into a 5G rollout, which includes the early award of the spectrum does not make for a focused approach and a better use of financial and technical resources. Hence, the measured approach towards a 5G rollout and spectrum award.”
With the operators still adamant that the government’s approach to 5G with DNB is anti-competitive – a view notably shared by the GSMA – it will be interesting to see how many of them take up DNB’s offer over the first quarter of 2022.
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Research and Markets forecasts that revenues from mobile data services in Malaysia are set to grow at a 2.9% CAGR over 2020-2025 supported by expansion of 4G networks and roll-out of 5G networks over the forecast period. In addition:
- Mobile services revenue accounted for an estimated 61.7% of the total telecom service revenue in 2020.
- Mobile data accounted for a majority 38.7% share of the total telecom service revenue in 2020.
- Top three operators Maxis, Digi, and Celcom accounted for 69.7% share of the total mobile subscriptions in 2020.
References:
https://www.totaltele.com/511878/Malaysias-national-5G-network-to-offer-telcos-access-for-free
https://www.researchandmarkets.com/reports/5125298/malaysia-telecom-operators-country-intelligence
https://www.digitalnewsasia.com/insights/malaysias-5g-spectrum-conundrum-blessing-disguise