Deadline set to get 5G network going

Urgency of signing deals by end-June highlighted

PETALING JAYA: The main mobile network operators (MNOs) have been given a deadline to sign the 5G network contracts, failing which the government will ink them with mobile virtual network operators (MVNOs) to get the rollout moving.

A source said a meeting between the Finance Ministry and the MNOs was recently held where the urgency of signing concrete agreements with Digital Nasional Bhd (DNB) was impressed upon the industry officials.

“The 5G network rollout has been very slow and that is a huge source of frustration,” said the source.

The government had, last month, announced that it would be maintaining the single wholesale network (SWN) model but disposing of a majority stake of up to 70% in DNB to the MNOs comprising Maxis Bhd, Celcom Axiata Bhd, Bhd and U-Mobile Sdn Bhd to participate in the model.The Finance Ministry will own a “golden share” in DNB even though it will own a minority interest of 30% after the share sale.

Under the SWN model, the MNOs will pay an upfront wholesale fee to DNB to enjoy the 5G access, which would then be transferred to their respective end-users coupled with some value-added services.

DNB is the government-owned entity that was entrusted to roll out 5G connectivity across Malaysia on a cost-recovery approach.

In agreeing to sell a 70% stake in DNB to the MNOs, it was hoped that the sale of the equity interest could be finalised by the end of June.

While the share sale agreement has not been agreed upon, the friction between the MNOs and DNB still exists with reports saying that despite DNB having recently published the reference access offer (RAO), the four MNOs have yet to agree on key terms in the RAO published by DNB.

The document outlines the costs, deliverables, requirements, including terms and conditions for the 5G network usage. It also serves as a base for commercial access agreements.

A source said during the meeting between the Finance Ministry and the MNOs, it was pointed out that the deadline to agree on the terms of service would need to take place around the end of June. Three MVNOs were also present in the meeting.

“The MNOs were told that if an agreement was not signed by the deadline, the deals will be struck with the MVNOs,” said the source.

Another risk that the MNOs will face is in terms of pricing.

The source said MNOs that did not sign by the deadline may not receive the preferential rate.

DNB is reportedly committed to offer the 5G access at less than 20 sen per GB to the MNOs.

The public-private partnership in the rollout is to see 5G reach out to 80% of the population within three years or by 2024.

Last month, DNB was said to be deploying 5G infrastructure in Johor Baru and it has marked Perak, Penang and Selangor as the upcoming locations.

It was reported that the rollout of 5G was aimed at catalysing the nation’s socio-economic transformation, which will contribute RM650bil over 10 years to the country’s gross domestic product value.

The rollout of the 5G technology would also create 750,000 high-skilled employment opportunities in Malaysia.

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