Malaysia targets to launch 5G services by the end of 2021 through a government-driven special purpose vehicle that’s called Digital Nasional Berhad (DNB). The MCMC Chairman Dr Fadhlullah Suhaimi had recently said DNB is expected to announce an open tender soon that’s estimated to be worth RM15 billion.
According to The Edge’s report, DNB has invited a total of 8 telecommunications vendors such as Ericsson, Huawei, ZTE, Cisco, NEC, Nokia, Samsung and FiberHome to participate in the 5G infrastructure tender. The telecommunications giants are told to provide their views on building a national 5G network and to propose an end-to-end solution.
It is said that DNB has emphasised the important of local participation to these multinational companies and a stringent tender management system is in place to ensure the right controls throughout the process including governance procedures that will be supervised by a tender committee. The vendors will be evaluated on several criteria including technical competency, ability to integrate with existing telcos, innovative financing solutions and ability to support local vendor development.
Another source of The Edge also said that the tender exercise is expected to be finalised by the middle of this year and the appointed company will commence work on the 5G rollout shortly after. It is said that DNB is targetting to cover Putrajaya, Cyberjaya and some parts of Kuala Lumpur with 5G by end of his year. Coverage expansion for 17 major cities in Peninsular, Sabah and Sarawak would take place in 2022 and 2023.
The CEO of DNB is Ralph Marshall, a former top executive from Astro and Maxis. Meanwhile, Dato’ Asri Hamidon, the Secretary-General of the Treasury at The Ministry of Finance will serve as the chairman of the board. It is believed that the SPV has already assembled a management team consisting of telco veterans.
Although DNB is a government-entity, Finance Minister Tengku Zafrul has said that the RM15 billion required for 5G rollout across 10 years will be privately funded. In an interview with The Star, Ralph said DNB is expected to front load the investments with 25% of the RM15 billion will be spent in the first two years, 15% to 20% in the subsequent years and the percentage will gradually drop in the remaining years.
Unlike the traditional way of allocating spectrum directly to telcos, the Perikatan Nasional government has decided to award the 5G spectrum namely 700MHz, 3500MHz and 28GHz directly to DNB. The move is said to reduce costs associated with auction bidding and to speed up 5G deployment.
As a result, existing telcos including Maxis, Celcom, Digi, TM, U Mobile and Yes will offer 5G services through a wholesale agreement with DNB. According to the MCMC, the approach will help reduce the 5G investment burden on telcos and they can focus on improving existing 4G coverage under the JENDELA plan.
The MCMC assured that the approach will be transparent and they will treat DNB like any other telcos in Malaysia. This means DNB would still need to comply with the Mandatory Standards for Quality of Service (MSQoS) or risk being slapped with compounds.
The commission has also announced a public inquiry on the revision of the MSQoS. Under the proposed revision, telcos must deliver a minimum of 2.5Mbps at 90% of the time on mobile and a minimum of 25Mbps at 90% of the time for Fixed Wireless Access (FWA). The public and relevant stakeholders are invited to provide their feedback via MCMC.gov.my before 12pm on 4th June 2021.