Sunday, February 5, 2023

Malaysia’s 5G rollout might be delayed again as Maxis and Umobile allegedly decline stakes in DNB

NewsMalaysia's 5G rollout might be delayed again as Maxis and Umobile allegedly...

Recently, Communications and Multimedia Minister Tan Sri Annuar Musa announced that all major telcos in the country have been making progress on Digital Nasional Bhd’s (DNB) stake deals and are set to sign the agreement on 31 August.

However, it appears that the project had once again hit a blockade as Maxis and U Mobile allegedly refused to take an equity stake in the government-owned single wholesale network.

According to Reuters, a source close to the matter said the 2 major Malaysian telcos turned down the proposal for the big 4 telcos to acquire a combined majority stake as they could not see benefits of being a minority share holder in DNB.

Earlier this year, the government had offered telcos a 70% stake in DNB in an attempt to resolve the deadlock in the discussion. Under the new arrangement, the government will inject RM500 million for its 30% stake, while each of the six telcos will have to fork out RM200 million for about 12% stake in the single wholesale network.

Despite Maxis and U Mobile could not see the benefits of being a minority shareholders in DNB, the sources said both the firms have told the government they want to remain in talks for access to DNB’s 5G network.

However, it wasn’t clear if the government will allow them to do so without taking a stake in DNB.

At the time of writing, Maxis, DNB and Malaysia’s finance and communication ministries did not respond to requests for comment, while Celcom, Digi and U Mobile declined to comment.

Malaysia’s 5G plans plagued by delays

In December 2021, 2 smaller telcos began the 5G operations trial but the 4 main telcos refused to get on board with the government’s plans.

The telcos said the government’s plans for DNB to control all 5G spectrum would undermine competition and raise concerns over pricing and transparency.

They then asked the government to allow a second 5G service to be set up, to which the government rejected the proposal and said it would only offer the carriers stakes in DNB to alleviate their concerns.

It also claims that the plan will reduce costs, improve efficiency and accelerate the building of infrastructure.

DNB has said the country’s communications regulator will adopt stringent public guidelines to ensure fair pricing and a smooth rollout.

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