5g telco ibb

Incumbent out of 5G picture, but a SPV still raises doubts

IDC has highlighted initiatives like 5G as one of the key significant areas to look at for MyDIGITAL to move forward. The blueprint aims to continue to transform Malaysia into a high-income regional lead in digital economy.

Hot on the heels of the MyDIGITAL launch, Communications and Multimedia Minister Saifuddin Abdullah had announced Malaysia wants to be among the first ASEAN member states to roll out 5G. In a decision to do it themselves, the Malaysian government has selected Huawei to help them with this.

The research house IDC has noted, “Malaysian government decision to invest RM15 billion to build 5G infrastructure nationwide over 10 years period through a government-owned Special Purpose Vehicle (SPV) is a similar approach to the High-Speed Broadband (HSBB) project in 2008.”

The reasons to do so appear to be reasonable and logical: 5G requires high CAPEX, telco infra sharing will reduce wastage and cost, mobile operators can focus on what they  need to, AND they are exempted from having to go through a very costly spectrum auction.

Above all, the SPV will be licenses under the Communications and Multimedia Act 1998 and subject to MCMC’s regulatory oversight.

Structure-wise, organisation-wise, everything appears to be as it should be.

On the plus side, this is a better model than a  previous one where our incumbent telco offered wholesale capacity to our retail telcos. This had raised eyebrows because the incumbent was a  wholesaler that was also offering connectivity in the retail space.

Ensuring fair access and transparency

It is everything else being spouted about “5G First”that does not make sense. Chairman of the Malaysian Communications and Multimedia Commission, or MCMC, Fadhulullah Suhaimi Abdul Malek talked about a demand strategy to ensure the 5G network is being used.


Is Malaysia still at that stage that consumers need to know what generation of mobile cellular technology we are using when we connect to the Internet?

In any case, there is something else said by MCMC which is enough to niggle any telco’s mind – MCMC has said they will oversee transition to 5G, and that existing service providers can continue to roll out fibre and improve their existing 4G coverage and quality.

Where is 5G transitioning from, but 4G?

To top it off, MCMC also has a “5G First” policy and are investing in a demand strategy as well as a National Experience Centre that showcases future 5G-based services.

Does this not put them in competition with 4G and the poor service providers who have invested millions (billions) to offer 4G based services?

To add strain to the overall dynamic, the SPV is reported to offer 5G capacity on a wholesale basis to our telcos. Will the SPV be able to do so in a fair and equal manner now?

IT BTYES BACK! says:  And can the SPV guarantee they won’t take the 5G technology network which they build out, into the retail market? More pertinent, what is the nature of the entity that will be managing and operating the 5G network after it is completed? Because if it offers  5G capacity on wholesale basis as well as offer retail 5G services, it effectively competes with the telcos it is making out to seem it wants to protect.

That would be the Telekom Malaysia maneuver, all over again.