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Malaysia to roll out second 5G network to end state monopoly

Written by Nikkei Asia Published on   2 mins read

The move comes as the West presses Kuala Lumpur to keep Huawei out of operation.

Malaysia’s government plans to roll out a second 5G network next year with bidding for equipment contracts open to all companies, even as Western governments warn the country not to allow China’s Huawei to participate.

Currently, the state-owned Digital Nasional Berhad has a monopoly as Malaysia’s sole 5G network operator. Once coverage of this network reaches 80% of the country’s populated areas, a goal expected to be reached this year, a second entity will operate another 5G network in parallel, the communications ministry said on Friday. Bidding for contracts to build the second network will be awarded through an open tender process, it added.

Ending DNB’s monopoly was a promise Prime Minister Anwar Ibrahim made during the general election last year.

“As of now, we have reached 57.8% of the 5G rollout in the country, which means the road of 80% coverage of the population is another 22.2%. I think it is doable,” Communications and Digital Minister Fahmi Fadzil told a press conference on Wednesday, adding that there are roughly 2,000 5G transmitter sites to be built. The switch from a single to a dual wholesale network, he said, would be implemented in line with global practices.

Fahmi said having dual networks would increase capacity beyond what a single one could provide and reduce the risk of disruption from a failure in any single network. He also sought to dispel concerns that having a dual network system would result in slower speeds.

Last year, Anwar ordered a review of the MYR 11 billion (US 2.47 billion) contract awarded to Ericsson in an open tender process under the previous government. Ericsson won that tender against Huawei of China and Finland’s Nokia.

Following the review, Huawei reportedly lobbied to have a role in the country’s 5G rollout. This prompted the European Union and the U.S. to warn the Malaysian government that allowing Huawei to participate would bring risks to national security and foreign investment.

Fahmi said he would meet with foreign ambassadors to address such concerns, but stressed that Malaysia had the right to decide on its policies without outside interference.

“I hope to meet with the respective parties soon to explain our stance [on the issue].”

He believed that the decision to set up a dual 5G network would not only benefit the people but also help maintain a harmonious relationship with other foreign parties.

This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.


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