Digital Nasional Berhad (DNB) will offer wholesale 5G services for free to mobile operators during the initial rollout phase, after telcos complained that its prices were too high
Rolling out 5G infrastructure is expensive and time consuming, with operators around the world struggling to free up capital for their network expansion.
Malaysia’s approach to this issue, however, has been somewhat unique.
Back in February this year, the Malaysian government announced the creation of DNB, a special purpose vehicle created to rollout 5G infrastructure around the country, access to which would then be offered to the country’s mobile operators on a wholesale basis.
At the time, the Malaysian government said at the time that the move would allow a rollout of 5G infrastructure that was quicker and more cost-effective than the operators could provide, while also avoiding typical problems surrounding multiple competing networks, like overbuild.
But while this may sound like a good idea the problem, as ever, is cost. By November, one month ahead of DNB’s planned network rollout, none of Malaysia’s major mobile operators had signed up to use the company’s services.
The primary issue here was cost, with the telcos arguing that the 5G pricing plan would leave them paying more than if they had simply rolled out the networks themselves.
Transparency was also cited as a problem, with Malaysia reeling from the 1Malaysia Development Berhad scandal in 2016, whereby the government embezzled over $700 million via a similar special purpose vehicle.
Now, to encourage uptake, DNB has announced that it will allow operators to make use of its wholesale 5G services free of charge during the initial phase of its infrastructure rollout.
DNB says that it will initially make 5G services available in three locations from December 15, including parts of Kuala Lumpur, with a wider rollout taking place over the coming months.
Free 5G wholesale services will be made available to telcos until 31 March 2022.
With the operators still adamant that the government’s approach to 5G with DNB is anti-competitive – a view notably shared by the GSMA – it will be interesting to see how many of them take up DNB’s offer over the first quarter of 2022.
Telekom Malaysia said earlier this week that they had become the first operator in the country to sign up for 5G trials with DNB, but whether this partnership will be extended remains to be seen.