5G services under DNB model expected to be cheaper than current 4G charges by telcos - Tengku Zafrul

Recalling the efforts of the private sector in developing the country's 5G capacity, he said efforts to share networks, save costs and launch 5G network did not happen as expected due to differences of interest among mobile network operators.

He said given the importance of connectivity and the digital economy for the country, the government had taken firm action in February 2021 by announcing the Malaysian Digital Economy Blueprint (MyDIGITAL).

"One of the key actions taken under MyDIGITAL is the establishment of a special purpose company called Digital Nasional Bhd (DNB) to implement 5G services faster and more inclusively for all Keluarga Malaysia, based on a cost recovery model," he said during a question and answer session at Parliament today.

Tengku Zafrul was answering a question from Lukanisman Awang Sauni (GPS-Sibuti) on the allegation that telecommunication companies (telcos) did not want to register with DNB to use 5G because the price offered by DNB which was seen as operating as a monopoly was too high.

According to the Finance Minister, the proposed price currently charged to telcos is less than 20 sen per GB 5G, but it is still being refined and is awaiting approval from the Malaysian Communications and Multimedia Commission.

In terms of financial implications, he said telcos may prefer the implementation of 5G which is not open to all mobile virtual network operators to maintain their profitability position.

"On the other hand, the model adopted by DNB will encourage telcos to compete in terms of prices, products and services, because they have saved in terms of capital for the provision of infrastructure that has already been provided by DNB," he said.

Government Confident of DNB's Efficiency in 5G Service

Tengku Zafrul also refuted doubts about the efficiency of the private sector in implementing and providing 5G network building services.

"This is because if we recall the history of the country's development, we can see many companies owned by the government that have succeeded in placing Malaysia on the world stage," he said.

He pointed out the success of companies such as Petronas, Telekom Malaysia and Tenaga Nasional Bhd which have successfully grown locally and abroad as examples.

He emphasised that DNB also has the opportunity and potential to achieve success like government-owned companies with a high level of capability and professionalism in the implementation of each plan and strategy.

"DNB has been carefully established and is staffed by the most experienced experts in the telecommunications industry. The government's ability through DNB needs to be given a chance, because one day, we will be able to prove that their assumptions are less accurate, and Malaysia can succeed in implementing this model for 5G," he said.

According to him, the implementation of the 5G network is expected to generate RM21 billion in direct economic activity over the next 10 years and current industry participants will reap profits as the 5G network will adopt existing infrastructure to increase efficiency.

"In this situation, there is no concern that the implementation of the 5G network by DNB will impact existing investments or industry players as DNB's commitment is to partner, not compete with, local telcos," he said.

He added that the implementation of 5G is expected to support up to 15,000 jobs related to the development of the network, and the creation of about 148,000 jobs in the economy as a whole, while driving the economic transition to highly skilled workers.

"Although DNB was only established in February this year, I am confident it will succeed in ensuring the availability of 5G in the future," he said.

He said Malaysia was still lagging behind as it had not launched its own 5G network compared to neighbouring countries such as Singapore, Thailand, Vietnam, Indonesia and the Philippines, which had launched 5G networks as early as 2019.