(Jan 3): Malaysia expects “some kind of finality” in its review of the 5G mobile services contract by this quarter, said Communications and Digital Minister Fahmi Fadzil, amid fears that it would delay the roll-out of the high-speed network.
The Government’s concerns with the 5G services range from the contracts signed to the speed that the network is being deployed, Fahmi said in an interview on Tuesday (Jan 3) with local radio station BFM 89.9. The Government has a meeting on Tuesday with state-run Digital Nasional Bhd (DNB), the network’s owner, he added.
“I believe it might be early right now to say when the Cabinet will come to a decision, but I expect perhaps within this quarter, we will have some kind of finality, hopefully, because any further delays will perhaps, you know, we’re not sure what kind of effect or impact it would have,” Fahmi said.
Dogged by years of political instability, Malaysia has been one of the 5G laggards in Southeast Asia. In terms of average mobile download speeds, the country trails Singapore, Vietnam, Thailand, the Philippines and Indonesia, which have rapidly rolled out the network, according to a report by Opensignal.
The previous administration formed DNB in 2021 to spearhead the 5G deployment via a single wholesale network. DNB partnered with local unit of Swedish telecom major Ericsson AB to manage this for RM11 billion, courting criticism from then opposition leader Datuk Seri Anwar Ibrahim over the cost and transparency.
“Prior to this, the Ministry of Finance did not have full horizon visibility of the contractual obligations, whether it’s about Ericsson,” Fahmi said. “I believe there’s 145 contracts that DNB has signed. But more than that, it’s about the speed of the roll-out.”
Mobile network operators in Malaysia were slow to execute their access agreements to lease the network amid disputes over equal stakes totalling 70% that DNB offered to them. Six companies eventually signed up in October last year, with Maxis Bhd still seeking shareholders’ approval.
DNB in a statement on Monday said that Malaysia’s 5G network had achieved almost 50% coverage of populated areas with some 3,900 sites as at end-2022 — exceeding the target of 40%. These figures would take Malaysia’s Communications and Multimedia Commission (MCMC) two weeks to verify, said Fahmi.
Fahmi said that as of Nov 30, DNB had rolled out 2,575 5G towers, according to the MCMC. This compared with the company’s forecast of 3,433 towers by that period, he said. DNB must deploy a total 3,518 towers, he added.
Another key aspect was that just 87% of the towers were “fiberised”, said Fahmi.
“So that means if people have been complaining, ‘yeah, we have 5G, but it’s still only about 30-40 MBps, not the 100-200, whatever that’s been touted’. A lot of it might be because, where they are, the towers are not fiberised yet,” said Fahmi.