PUTRAJAYA – The government’s shift from a single wholesale network to a dual network for the roll-out of 5G connectivity in the country will provide telecommunications companies freedom to cater to their customers’ specific needs, especially in providing enterprise solutions, said Communications and Digital Minister Fahmi Fadzil.
Fahmi said with control over their own infrastructure, the telcos would be able to roll out enterprise solutions suited for clients of the mobile network operators, which come from a myriad of sectors.
“This (shift to dual network) is more of a business consideration as some telcos may perhaps be looking at refineries or offshore platforms or the oil and gas (sector), whereas some might be looking at certain retail businesses or certain types of factories.
“Different enterprise solutions may require different types of equipment,” Fahmi said in a media briefing on the nation’s 5G direction at the ministry’s headquarters recently.
“This means that the telcos can make their own decisions on whatever they feel is needed (to fulfil the requirements of their customers).”
On May 3, Fahmi announced the shift to the dual network for ultra-fast 5G connectivity in the country, following comprehensive cabinet discussions on the matter as well as consultations with industry players.
However, he said the implementation of the roll-out would continue under the government’s special purpose vehicle Digital Nasional Bhd (DNB) until 5G reaches 80% coverage of populated areas (CoPA) by the end of 2023.
In essence, the shift from the single wholesale network to a dual network means that there will be entity A, which will continue to operate and widen DNB’s network, as well as entity B which would be independently owned and run by the telcos.
During the briefing, Fahmi said the telcos participating in entities A or B have yet to be decided and that the commencement of the latter’s operations depends on the telcos reaching a decision on the matter.
“It could be, for example, as early as January next year.”
He said although two entities will be handling the 5G roll-out, the government remains committed to ensuring there is no increase in costs at the wholesale level.
“This is important because previously, according to DNB, the 13 sen per gigabyte (rate for 5G) was the wholesale price for the telcos, which would then, in turn, be sold to us (consumers) at a different rate.
“It could be RM2 or even RM1.40 per GB depending on the packages (for users),” he said.
“Most importantly, the pricing for telcos using entities A or B will not be any worse off than what it is right now. It will not be more expensive for the wholesale price per GB than what is currently being offered.”
Special task force
Fahmi said the government has also decided to form a special task force that will hold meetings on a fortnightly basis, and report to him on the status and progress of the 5G roll-out, as well as the shift from the single wholesale network to the dual network.
The focus of the task force is the implementation of the 5G network, to ensure that the coverage and roll-out are expedited to reach the 80% CoPA target by the end of the year.
He added the task force will be co-chaired by Treasury Secretary-General Datuk Johan Mahmood Merican and Communications and Digital Ministry Secretary-General Datuk Mohamad Fauzi Md Isa, with the Malaysian Communications and Multimedia Commission as the secretariat.
“They will report to me and I will present (their findings) to the cabinet.”
Fahmi said the second entity would not merely focus on the remaining 20% CoPA, although entity A under DNB would reach 80% by the end of this year.
The Lembah Pantai MP said once entity A has reached 80%, entity B will build its own infrastructure of up to 80% CoPA and beyond.
“This means that we will have two networks that will have more or less the same amount of coverage,” he said.
“For example, the coverage of 4G towers around Malaysia has exceeded 96%, but not all telcos reached the same figures. For the purpose of the 5G roll-out, the most important part is that entity B will build up its own separate network.
Regardless, Fahmi said users of telcos under entity B will still receive 5G connectivity while it is building up its infrastructure, as the telcos involved will ride on entity A’s 5G connectivity.
“This is made possible through the multi-operator core network.”
The Malaysian Communications and Multimedia Commission has noted that up to April 30th, the implementation of 5G across the country has reached 59.5% CoPA, a sizable progression from the 57.8% announced by the end of March this year, Fahmi said.
He added that from the total 7,509 towers needed for 5G connectivity around the country, 4,827 have been built by the end of April.
The future of DNB
Explaining the government’s position on DNB, Fahmi said the intent to dilute 70% of the government’s shareholding will go as planned.
He said prior to the dissolution of Parliament last year, four MNOs were prepared to take up stakes in DNB and that they had gone through the process.
However, he said certain conditions had not been met, which subsequently led to the entire share agreement being unresolved.
“Effectively, we are not changing the model of handling DNB very much at all. So those who feel that we (the government) were cancelling the contracts (are inaccurate), as we are not doing that at all,” he said.
“With regard to government ownership of DNB, the intent to dilute the 70% shareholdings is still the same as before. Whether there will come a time when the government will completely and fully exit DNB is a decision for us to make at a later date. It’s not something we are discussing right now.
“Right now, it’s about equity take up for the MNOs. The chief concern is ensuring DNB continues the roll-out of the 5G network so that we reach 80% CoPA.” – The Vibes, May 26, 2023
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