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MCMC will treat Digital Nasional Berhad like any other telco in Malaysia

The Ministry of Finance has recently named Digital Nasional Berhad (DNB) as the government-owned Special Purpose Vehicle to roll out Malaysia’s 5G network. Instead of having an auction with the telcos, the Malaysian government will award the spectrum directly to DNB, which will then provide 5G services through a wholesale agreement.

The Malaysian Communications and Multimedia Commission (MCMC) has issued a statement that DNB’s undertaking to deploy 5G infrastructure and network nationwide will be licensed under the Communications and Multimedia Act 1998 (CMA 1998). This means the government-owned entity would be subjected to the regulatory oversight of the MCMC, just like any other licensed service provider in the communications and multimedia industry.

This could mean that the DNB would need to fulfill MCMC’s Mandatory Standards (MS) for Quality of Service (QOS) or risk being slapped with compounds if it fails to meet the required standards. Since every telco in Malaysia has to tap on DNB’s 5G network, there won’t be any significant differences in terms of coverage and signal strength.

The MCMC said it will regulate and monitor the DNB via the relevant regulatory tools under the CMA 1998 to ensure the optimum use of spectrum and all telcos will have open, fair and equal access in obtaining wholesale 5G network services.

The commission has reiterated that the single-entity approach will remove the need for telcos to invest heavily in 5G networks and they can focus their efforts to improve existing 4G services and fibre networks under the JENDELA plan. The 4G network will serve as a foundation for the success of 5G deployment.

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It also said that DNB will act as a wholesale neutral party which will enable other licensed telcos to focus on the latest technologies to develop innovate retail services to consumers, enterprises and the Government. The MCMC also said that the speed and cost savings of the 5G deployment will be passed on to benefit the end user.

Former Astro and Maxis top executive, Ralph Marshall, has been appointed as the CEO at DNB, while Secretary-General of the Treasury, Dato’ Asri Hamidon, will serve as chairman of the board. Other board members include Datuk Seri Dr. Yusof bin Ismail, Dato’ Mohamed Sharil Tarmizi and Dato’ Muthanna Abdullah. Other senior management appointments will be revealed in due time.

The 5G rollout will require an investment of RM15 billion over a span of 10 years. It still isn’t clear which vendor and provider will be selected to deploy the 5G infrastructure. MCMC has recently revealed that the RM15 billion will actually come from the private sector. Malaysia now aims to launch full fledged 5G services by the end of 2021.

To recap, the previous administration had initially planned to launch 5G in Q3 2020 and the spectrum was supposed to be awarded to a single consortium that consists of several private companies. Back then, the MCMC’s 5G Task Force had estimated an investment of RM7-8 billion to upgrade existing networks to 5G.

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Alexander Wong