What’s All The Fuss About 5G In Malaysia When We Barely Have 4G

The problems, solutions and aspirations behind it all.
(credit: Nour Betar / Unsplash)

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Before the first 5G devices arrived on our shores in late 2019, We were told that “5G” is the next big wave to hit the turbulent tech market.

5G is the fifth generation of mobile technology and is the new global standard after 1G, 2G, 3G, and 4G networks. It is meant to deliver higher data speeds, with lower latency, more reliability, and increased network capacity. 

We began to see the word written 5G on boxes of mobile smart devices, in the news, and in exhibitions.

Pretty much everyone tried to sell us on 5G – trying to fish us in with promises of higher speeds and the Internet of Things (IoT).

But, despite all that, a 5G connection is nowhere to be found, and all we’re left with is still a 4G connection.

But what’s the problem with 4G and why do we need 5G in the first place?

Well, long story short, 4G kinda s*ck$… Here’s why:

1. Expensive prices

Pretty much everyone in Malaysia depends on mobile data. From 2020 to 2021, the country’s mobile data usage increased by 35.2%, putting Malaysians as the top mobile network users in the whole of ASEAN.

However, it’s well known that Malaysians pay more for mobile services than our neighbours. In fact, we are paying the highest average consumer prices for mobile services compared to other countries in the region.

It is said that on average, Malaysians pay RM50 a month for their mobile data. That is a lot for a single person, and even more if you’re the one who is paying the bills for the whole family.

2. Low quality

This is why most of us still depend on WiFi at home, the library, or even camping out at Mamak stalls if we need a dependable connection.

3. Minimal coverage

We’ve all seen the stories about the mountains our youths,  parents and guardians had literally and metaphorically climbed to get dependable mobile connection in the name of education.

Meanwhile, the 4G rollout in the hands of telcos has been spotty, especially in low-density residential areas and the more rural parts of the country.

Read More: To Get Good Internet For Online Exams, This Sabah Student Spent 24 Hours In A Tree

So 5G is supposed to fix all this? How?

There’s definitely a lot of room for improvement that’s needed to Malaysia’s mobile internet infrastructure, and the truth is 5G does have the capacity to change the way Malaysia connects with the world.

1. Lightning speeds

In the most optimal settings, 5G connections can be up to 100X faster than 4G with near-zero latency.

That means streaming videos at higher resolutions, gaming with no lag, and online shopping with no hiccups.

2. Connectivity for all

Have you ever noticed that your mobile data connection almost always fails when you go to a large gathering of people like a concert, convention, or a Ramadan bazaar? This is because a single 4G tower can only connect to so many devices.

However, a 5G tower can connect to a lot more 5G devices, making sure that everyone is able to get and stay online.

3. Futuristic applications

It is this connectivity advantage that opens the door to innovations such as Augmented Reality (AR), Artificial Intelligence (AI), Massive Machine Type Communication (mMTC), Ultra-Reliable Low Latency Communications (URLLC), and IoT.

To make all these new devices and applications work, each one of them will need its own data connection and outside an environment with wifi, it is something that only 5G can feasibly handle.

For us everyday users, that means everything that we own from the car to the lightbulb in a room could be connected to the internet, be controlled remotely, and report back to us if anything needs to be done.

Video calls would feel more like conversations and games would be more responsive because of low latency. 

This will all depend on the network condition of course. 

4. The Future With 5G

For us, the everyday rakyat, 5G will improve traffic as every vehicle, traffic light, traffic sensor, and cameras, work in concert to manage traffic. 

Because every mode of public transport including but not limited to trains, buses, and rideshares can talk to each other over 5G, commuters and service providers alike can optimise their route depending on traffic, demands, and even other factors like the weather.  

With every transport system running through a centralised system every vehicle knows where every other vehicle is, emergency response times, among many many other things like delivery and will be faster as every ambulance and rider can chart a path of least traffic. 

5G is also predicted to create more jobs. It is estimated that it could also generate some 750,000 new high-skilled positions by 2030, putting Malaysia at an advantage over its neighbouring countries. 

The technology promises to greatly expand the number and nature of devices that connect to the mobile internet and can allow an emerging nation like us to rapidly expand its use of digital technology in all industries.

That in turn will welcome more high tech industries into the country, create more jobs, and increase the wealth of the nation.

There’s also a lot of money to be made with 5G and the sooner Malaysia gets nationwide 5G coverage, the sooner it can reap the economic gains.

A recent study from Ernst & Young suggests that 5G has the potential to increase the nation’s GDP by RM650 billion over the next 10 years, with RM150 billion in 2031 alone.

So what’s the plan? Are we getting 5G or not?!

As individuals, there is nothing much we can do about 4G and its ever-increasing cost, the poor service, and the declining network quality. We are at the whims of the service provider who also owns the network.

We could only watch our neighbouring countries enviously as the quality of their mobile services went up and costs went down.

Realising this, the government decided to establish a single entity to manage 5G deployment and adoption nationwide.

The objective of this entity is to support Malaysia to become a leader of the digital economy in the region and to promote a more inclusive society.

What’s the government doing about it?

As individuals, there is nothing much we can do about 4G and its ever-increasing cost, the poor service, and the declining network quality. We are at the whims of the service provider who also owns the network.

We could only watch our neighbouring countries enviously as the quality of their mobile services went up and costs went down. 

Realising this, the government decided to establish a single entity to manage 5G deployment and adoption nationwide. 

The objective of this entity is to support Malaysia to become a leader of the digital economy in the region and to promote a more inclusive society.

“The Plan”

It’s called Single Wholesale Network (SWN) and it is the opposite of the demand-led and profit-driven focus of the 4G rollout by telcos.

In this model, a single neutral entity controls the entire 5G spectrum. 

This makes sure that the service rolls out justly, wherever it is needed and inclusive of rural areas and low-density areas.  

It also lets the entity be efficient by optimising existing infrastructure, having full use of the 5G spectrum, and providing the service at a lower cost without red tape and concern for profit or the interest of shareholders. 

The first step

On 1 March 2021, the Ministry of Finance announced the establishment of Digital Nasional Berhad (DNB) and coined it as the Special Purpose Vehicle (SPV) for Malaysia’s 5G rollout.

DNB is wholly owned by the Minister of Finance (Incorporated) and is licensed under the Communications and Multimedia Act 1998 (The Act) to provide wholesale 5G coverage and capacity to other licensees under the act. 

Its target is to achieve a 5G coverage of 80% in populated areas in 2024 and to accelerate the deployment and adoption of 5G technology.

The 10-year mission for the DNB-led 5G rollout is estimated to cost RM16.5 billion, which will be fully funded by the domestic financial services sector based on the DNB business model.

This means that Malaysia – and the rakyat – will wholly own its 5G network.

Benefit for the rakyat

Expect the quality of service to improve and the rates lowered as costs are reduced at the top and is predicted to trickle down to us users. 

Thanks to the transparency of DNB we know that telcos are estimated to pay less than 20 cents per GB for 5G. 

We will know if they are overcharging us because that is approximately less than half of what it costs them to put up their own 4G infrastructure. 

The cost savings will also benefit the industry. With more money to spare, it can be spent on other things like cost-saving optimisations, or investments into new industry verticals, and revenue growth opportunities.

Equality for all

To be fair to all parties involved, especially telco companies, DNB also uses the Multi-Operator Core Network (MOCN) model. 

Imagine it as a single, secure, and seamless digital “superhighway”, that will support all telcos equally on a wholesale basis.

(Credit: LEEROY Agency from Pixabay)

This model was successfully demonstrated on 10 November with the integration of 5 telcos. It was witnessed by Tan Sri Annuar Musa, the Minister of Communications and Multimedia of Malaysia, as well as several industry leaders.

So to quickly recap

1. Why do we need 5G when we have 4G?

The Covid-19 pandemic showed us how important digital technologies and connectivity are.

Significant spikes in data demand from the people straining existing networks and highlighted its flaws. 

That demand is only expected to increase with time, and Malaysia’s telco infrastructure needs to be able to meet this demand. 

2. Why the push for 5G so suddenly?

When it comes to 5G Malaysia is already behind. Singapore, Indonesia, Thailand, Vietnam and the Philippines have already launched their 5G networks as early as 2019. 

If we take any more time to develop and deploy 5G, it will impact our economic competitiveness and affect our national development. 

4. Why is the company responsible for 5G fully owned by the Government, and not the private sector?

Because this is important to the country and the growth of its digital economy. 

In February the Government announced the Malaysia Digital Economy Blueprint (MyDIGITAL).

One of the primary actions taken under MyDIGITAL was the establishment of a Special Purpose Vehicle (SPV) named “Digital Nasional Berhad” (DNB) to accelerate the 5G rollout, based on a cost-recovery model.

5. How much will it cost the Rakyat?

Almost nothing…

While DNB is owned by the Government and regulated by the MCMC, it is financed by private-sector financial institutions. There is no requirement for any funding by the public sector or the government.

6. Seriously though, how much does it cost and where will they get the money?

Deploying the 5G network alone will cost RM16.5 billion and will take over 10 years. 

It will be financed through a mixture of deferred payments to vendors, trade and working capital financing, and a Sukuk (sharia-compliant bonds) programme that will be raised in the domestic debt capital market. 

DNB will secure the money needed from the financial services sector including banks, which it will then be repaid using the money made from selling the network capacity.

Because of that, the Government does not have to spend our tax money for the rollout.

7. DNB is a new entity. How can we be sure it can do a better job?  

DNB was established from its first day to be staffed and managed by industry veterans and private sector specialists.

8. Looks like it hasn’t convinced the telcos. 

There are some hurdles. For telcos to be able to sign with DNB, a Reference Access Offer (RAO) must be published in accordance with the Mandatory Standards of Access. 

Also on 1 December 2021, Telekom Malaysia Bhd signed a 5G Network Trial Agreement with DNB. Recently, YTL Communications Sdn Bhd did too.

Other telcos are also expected to sign 5G Network Trial Agreements with DNB soon

9. So, was the tender process open?

Ernst & Young Consulting Sdn. Bhd. (EY Consulting) structured the process. 

They followed the global standards and involved four panels, comprising 50 local and international experts from across 10 countries with 5G network rollout experience.

The process began with the initial evaluation of fourteen Network Equipment Providers (NEPs).

Eight were shortlisted and invited to bid for the tender. There were four final bids received.

The process was transparent and had strict requirements. 

10. How about the concerts regarding the SWN model?

In Malaysia’s, the Government lets DNB provide 5G wholesale services at the lowest possible cost for the benefit of the industry and customers: 

  • Firstly, as a supplier of wholesale 5G services, DNB will not be competing with the industry. Instead, DNB is complementing the mobile network operators.
  • Secondly, DNB will work with telcos and infrastructure providers to develop the 5G network and utilise existing infrastructure as far as possible.
  • Thirdly, the pooling of 5G spectrum in a single neutral entity like DNB will allow for much greater efficiency, and allow DNB the ability to provide 5G wholesale services at the lowest cost.

So what are you waiting for? The future is now here! Find out about the 5G plans your telco is offering today.

Here’s a link to the map of 5G coverage in Malaysia:

You can also check out all the possibilities that 5G would bring here:

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