KUALA LUMPUR – Supporters of a dual wholesale network (DWN) system for the next generation upgrade of the national mobile telephony, or 5G, have apparently not asked the telecommunication companies proposing the plan about the price they will charge consumers.
The telcos promoting the plan have been silent on this and their supporters, including some prominent politicians, have not pinned them down on this issue.
On the other hand, the government company Digital Nasional Bhd (DNB), set up to spearhead the upgrading of the nation’s mobile infrastructure – the 3G and 4G networks that are now creaking under the weight of heavy usage – has pledged to charge no more than 20 sen per GB to telcos.
It is estimated that even when re-selling the data for a premium margin, it should be substantially lower than the current average of RM2 per GB charged by telcos to consumers for a lower quality 4G service. 5G promises a significant leap in mobile access and computing.
DNB’s single wholesale network (SWN) is set up with the idea of hastening the setting up of the infrastructure and providing as wide a coverage as possible, including at least commercially attractive areas. It is also aimed at reducing cost and roll-out time as well as duplication of investments as per the 4G system currently, where each telco has its own network.
DNB will offer access to its 5G network to anyone interested, especially the telcos. Thus far, all the major mobile players have not signed up to the plan. Only Telekom Malaysia Bhd and YTL Group, which operates the Yes service, have done so.
Analysts suggest it is not possible for the proposers of the alternative network to match DNB’s 20 sen or less per GB guarantee. As a government company, DNB operates on a cost recovery mode and not for profit, hence, it is able to sell data almost at cost.
However, the consortium made up of Maxis Bhd, DiGi Bhd, U Mobile Sdn Bhd and Axiata Bhd is silent on the charges to be passed on to the consumers. Needing to invest heavily in the network, it is unlikely they could match DNB’s offering, analysts said.
The SWN strategy is being opposed by the major telcos for a multitude of reasons including concern of not being in control of DNB’s network, a fear of a possible single point of failure, as well as having to accelerate the amortisation of billions spent on their 4G infrastructure.
Also high on the list is perhaps the possible entry of competition from new players tapping into the network with relatively lower entry cost.
They have also lobbied the government and politicians against the SWN, arguing based on the survival of telcos having spent billions to set up their respective networks.
Since the government is going ahead with DNB, the telcos are now said to be proposing that they set up a second network that they promise to be up and running faster and cover as much as DNB. However, for the less commercially viable regions of the country, especially Sabah and Sarawak and rural areas of Peninsular Malaysia, they are said to be planning to tap the universal access fund managed by the Multimedia Commission.
DNB has pledged to cover some 80% of the country by 2024. Malaysia’s upgrade into 5G is a few years behind its neighbours since most of the telcos have not been keen to invest in the new upgrade and were said to be trying to get as much from their investments in the existing networks before doing so. This has been at the expense of consumers and businesses with data consumption being so much higher now than when the 4G was mooted almost a decade ago.
The cabinet is expected to discuss the DWN proposal in its meeting next month. – The Vibes, January 26, 2022
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