MCMC: Telcos to optimise existing spectrum for 4G, 700MHz to be released later based on need

Malaysia has recently introduced the JENDELA plan which aims to boost connectivity nationwide especially in rural areas. The initial target of rolling out 5G in Q3 2020 has taken a back seat as the government is now prioritising improvements of existing 4G networks. An improved 4G coverage would serve as a strong foundation to ensure that 5G can be rolled out in an efficient and effective manner.

One of the key targets is to expand 4G population coverage from 91.8% to 96.9% within phase 1 of JENDELA (2020-2022). Responding to our queries on spectrum, the Malaysian Communications and Multimedia Commission (MCMC) has told us that all service providers will have to expand their coverage with their existing resource. This is an indication that there won’t be any new spectrum allocation and all providers will have to make full use of their existing spectrum to improve their 4G experience.

MCMC also shared that the spectrum allotment is technology neutral, which means that operators are able to reuse their existing 2G or 3G spectrum for 4G. This is also applicable to the highly anticipated 700MHz spectrum, which means that operators could use it for 4G, 5G or both simultaneously via Dynamic Spectrum Sharing (DSS).

Before JENDELA was announced, the 700MHz spectrum was quietly awarded to Altel, Celcom, Digi, Maxis and TM through ministerial orders but it was later retracted. Deputy Communications and Multimedia Minister Datuk Zahidi Zainul Abidin had said in July that the allocation of the 700MHz spectrum will be decided soon and it will be priortised to telcos with existing subscribers.

At the moment, the 700MHz spectrum has yet to be assigned to mobile operators and it is too early to tell if it will be a allocated directly to telcos or to a consortium. The MCMC says it will monitor the current infrastructure developments under the JENDELA initiative and will only decide on the 700MHz spectrum based on arising needs.

As illustrated above, the top 3 telcos – Celcom, Maxis and Digi have over 100MHz chunks of spectrum and a significant amount is currently utilised for 3G. With the impending 3G shutdown by end 2021, the MCMC is pushing telcos to fully utilise the 2100MHz band for 4G as part of its strategy to strengthen 4G coverage.

The MCMC also emphasised that the government is expediting the improvement of connectivity for both fiber optic and 4G networks. This will help to close the digital gap especially in rural areas and eventually ensure a good and efficient 5G network in the future.

1.74 million 3G users in Malaysia

The MCMC has also shared that there are currently 1.74 million exclusive 3G users in Malaysia. All of them will have to migrate to 4G devices by the end of next year, which is only 15 months away.

To get more people to switch, the telcos will be introducing new initiatives to encourage conversions by educating consumers of the superiority of 4G while providing VoIP services over their 4G network. On top of that, telcos will offer attractive 4G device bundles and will stop sales of 3G-only devices.

As mentioned in our previous post, users who are still using 3G devices would still be able to make calls and SMS on a 2G network, however, they will experience a huge decline in mobile data experience when connected on GPRS/EDGE. At the same time, telcos such as Maxis and Celcom would also need to ensure that Voice over LTE (VoLTE) is enabled for all customers nationwide. Without VoLTE, devices will have to switch to 3G or 2G when making or receiving a voice call.

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