KUALA LUMPUR (Feb 19): The highly anticipated announcement by Prime Minister Tan Sri Muhyiddin Yassin on the 5G roll-out plan this morning still lacks details, leaving analysts in murky waters.
During his speech on the MyDigital initiative, he revealed that a total of RM15 billion will be invested over a period of 10 years for the purposes of 5G implementation, which will be undertaken by a special purpose vehicle (SPV) under the Government.
The SPV, said Muhyiddin, will be given the appropriate spectrum to own, implement and manage the 5G infrastructure, with all licensed telecommunication companies (telcos) to be given “equal access” to the infrastructure “in marketing their 5G services to their customers”.
RHB Investment Bank analyst Jeffrey Tan said there was a lack of details about what form the SPV will take, although he said it could be for the purpose of ensuring that no single player would dominate the spectrum.
“It could well mean that no one party has a stranglehold over the spectrum and licensees will have every right to utilise the spectrum for the 5G roll out, subject to conditions. There is some semblance to the consortium approach, but it could also be a hybrid model,” he told theedgemarkets.com.
However, the underlying basis that the roll-out would be done in a cost-effective manner — with telcos working together to share the network and spectrum — should remain, Tan said.
Another analyst, requesting anonymity, said what is known so far bears similarity to what Telekom Malaysia Bhd (TM) had proposed during the roll out of the high speed broadband in 2011.
He also opined that a Government-owned SPV heading the 5G initiative may not be a good idea as it may slow down the roll out of the technology, “due to bureaucratic issues”, which he said may lead to an increase in costs.
“The SPV should consist of four or five established players, with the necessary experience and substantial subscriber base, with existing assets, in order for it to be effective,” said the analyst.
“If TM is commandeering the initiative, it might not be the industry’s wish. The Government should free it up to the industry players,” he added.
The analyst, however, noted that if it was left to the players, there is still the issue of telcos being hesitant to set up infrastructure in rural areas, as it may not be profitable for them.
Nonetheless, he said that what is envisioned now may be entirely different, depending on the details of the SPV to be announced by the Government.