PETALING JAYA: Mobile network operators (MNOs) are offering discounts and competitive pricing on home fibre services instead of postpaid plans to sustain customers and revenue, says Kenanga Research.
Prepaid average revenue per user (arpu) seems to have bottomed out and net additions are expected to remain weak with volatility driven by persistent competition, according to the research house.
Kenanga Research expected continued momentum in postpaid net adds in the fourth quarter of 2025 as MNOs drive adoption through high-value bundled convergence offering aimed at reinforcing the stickiness of its postpaid base.
The shift in focus toward convergence is evident from CelcomDigi Bhd
’s recent move to emphasise average revenue per account rather than Arpu, reflecting the greater lifetime value of converged customers, according to the research house.
It retained its “neutral” stance on the telecommunications sector amid persistent uncertainty surrounding the 5G Dual Network (5GDN) framework.
However, Digital Nasional Bhd’s (DNB) shareholder funding in August signalled progress, which could pave the way for eventual finalisation of 5GDN.
The outcome of DNB’s restructuring, initiated in February, should better position it for an eventual takeover by its remaining MNO shareholders.
U Mobile Sdn Bhd’s 5G launch in August was a prelude to the finalisation of deployment plans for the second 5G network (NW2), it said.
This augured well for its preferred NW2 play, namely OCK Group Bhd. It is in advanced negotiations with technology vendors for potential collaboration in deploying 5G infrastructure with prospective contract value of more than RM500mil.
However, rollout momentum mighr had remained sluggish given NW2’s initial focus on in-building coverage, which is typically delayed by permit requirements and restricted working hours.
For fixed-line players, Kenanga Research expected rising demand for international and terrestrial connectivity.
This is as hyperscale data centres and cloud regions in Malaysia require links to Internet exchange points, submarine cables and global digital ecosystems.
Its top sector pick remains TIME Dotcom Bhd.
It said Telekom Malaysia Bhd (TM) is expected to begin recognising revenue from its RM2.4bil fibre backhaul contract with U Mobile by end-financial year 2025, although the actual ramp-up hinged on NW2’s rollout schedule.
U Mobile may award backhaul contracts for the remaining 30% of its 5G sites not covered by TM to Time, according to the reseach house.
The research house anticipated engineering firms such as Redtone Digital Bhd, Hextar Capital Bhd and Theta Edge Bhd to be engaged for network contracting works.
