PETALING JAYA: Mobile network operators (MNOs) and tower infrastructure providers will benefit from improved coverage and connectivity once the Jalinan Digital Negara Phase 2 (JP2) project is rolled out.
However, execution remains a key overhang, with potential delays in site acquisitions as the majority of new sites in remote areas present challenges in access and permit securing, according to RHB Research.
The research house added that the JP2 rollout was long overdue.
“The JP2 rollout was (meant) to have commenced in 2023, but execution issues and delays in JP1 (notably in Sabah and Sarawak) delayed its implementation with an overhaul of the process.
“The government had allocated RM780mil under Budget 2026 for JP2, which utilises fit-for-purpose technologies to overcome challenges associated with traditional tower infrastructure,” it said in a note to clients.
On March 31, the industry regulator issued requests for proposals (RFPs) for the improvement of broadband and internet connectivity nationwide under JP2. The dateline for submissions is June 3, with awards expected in by August or September 2026 and rollout to commence thereafter.
Subsequent RFPs for Batch 2 is slated to be issued in the second half of financial year 2026 (2H26).
“We see MNOs benefitting from improved coverage and connectivity, especially in Sabah and Sarawak where 4G and 5G population coverage still lags the national average of 99.7% and 82.4% as at 4Q25.
“Telekom Malaysia Bhd
is a key beneficiary of improved fibre connectivity and 5G mobile backhaul fiberisation with wholesale contracts inked with Digital Nasional Bhd and U Mobile for 5G network expansion.
“The latter is targeting 80% population coverage by 2H26 and 95% in 2028.”
Other potential winners include telecommunications tower companies and tower infrastructure providers such as Edotco Group Sdn Bhd, OCK Group Bhd, Reach Ten Holdings Bhd and Redtone Digital Bhd which were involved in JP1.
