Malaysia to stick with sole 5G network, offer 70% stake to telcos

Malaysia said on Wednesday it would offer up to 70% equity in wholly state-owned 5G agency Digital Nasional Berhad (DNB) to telecoms firms, amid concerns among wireless carriers that a single, shared 5Gnetwork could hamper competition.

The announcement comes after the matter was raised in the cabinet last week.

Mobile service operators had recommended a second 5Gprovider in an impasse with DNB over pricing and other issues, people with knowledge of the matter told Reuters in December.

The government is sticking with its plan for a sole 5Gnetwork to maintain policy continuity but will allow telecoms companies to hold equity stakes to speed up the construction of infrastructure, the finance and communication ministries said in a joint statement on Wednesday.

“Ownership, equity value, and other aspects related to this proposed equity participation are subject to negotiations between DNB and telecommunications companies, with an agreement set to be finalized in the near future,” the ministries said.

The government will retain a 30% equity stake in DNB, with the agency to be regulated by the communications ministry.

DNB and major operators Axiata Group’s Celcom,DiGi.com Berhad, and Maxis Berhad did not immediately respond to requests for comment.

Malaysia last year scrapped a plan to apportion spectrum to service providers, opting instead for a single shared network to reduce costs, improve efficiency, and speed up infrastructure construction.

Service providers said that plan risked creating a nationalised monopoly that would be more costly than if they deployed 5G networks themselves. DNB said the cost of accessing its 5G network would be less than the telecom companies incurred for 4G.

DNB has also offered free 5G services to service providers until March 31 while it seeks to finalise long-term wholesale agreements