Industry observers believe a combination of the two companies is viable as it creates two powerful 5G networks capable of catering for future growth and it will be able to infuse competition.
PETALING JAYA: Will Telekom Malaysia Bhd
(TM) and Maxis Bhd take the lead to build a second 5G network, as together they are seen as a formidable force?
This is the view of some experts. The country is looking to transition to a dual wholesale network for 5G by the end of 2024.
If the two team up, then the existing 5G network is to be owned and managed by Celcom Digi Bhd, U Mobile and YTL Communications and the government is finally going to make its exit from the 5G space, leaving the players to slug it out.
Industry observers said that if the calls from the industry were heeded, Digital Nasional Bhd (DNB) would not have been formed and the players would have built their own 5G networks, allowing Malaysia to keep up with its peers in the region.
They believe this combination is viable as it creates two powerful 5G networks capable of catering for future growth and it will be able to infuse competition.
Eventually, it depends on the industry regulator and what the players really want, they added.
The five telecommunication companies (telcos) have been invited by the government to submit proposals to develop Malaysia’s second 5G network.
The government had also said that telcos are restricted to holding equity only in one entity. They have till month end to submit their business proposals to the regulator and a decision on who leads the second 5G network will be made by year-end.
According to UOB Kay Hian (UOBKH) Research, the return of network ownership allows Maxis (and other players) to optimise their existing 4G and future 5G spectrum so as to achieve superior network and good quality of service.
The research firm believes that Maxis is a key beneficiary of Malaysia’s transition to dual wholesale network as it expects the group to vie for a second network.
With the restriction to hold equity only in one entity, consortiums forming entity B (or the second network) will sell their share in DNB. The government will also exit DNB.
UOBKH Research said under the mobile network operator (MNO) and DNB agreement, each MNO must choose to invest in entity A or B within the dual 5G network model.
“After the conclusion of the Applicant Information Package process, the successful tenderer will lead entity B, while unsuccessful bidders will remain in entity A.
“MNOs in entity B will sell their share in DNB, ensuring the formation of the two entities,” it said.
