Malaysia to build 5G network itself to speed up service launch

[KUALA LUMPUR] Malaysia will build 5G infrastructure itself instead of relying on private telecom carriers as it seeks to accelerate the roll-out of high-speed services.

Companies including Telekom Malaysia and Huawei Technologies are expected to play a significant role once the work begins "as soon as possible" to have the network available by end-2021, Communications and Multimedia Minister Saifuddin Abdullah said in a group interview on Monday.

"We want to be among the first Asean member states to roll out 5G deployment and not just limit ourselves to 5G test labs," Mr Saifuddin said. "It is very important for investment, and this is where companies like Huawei will play a very, very significant role."

The government's decision to build the network itself was made for a simple reason that it would be faster, he said. This was after the government considered the options including issuing tenders and asking the main carriers to form a consortium, he added.

Prime Minister Muhyiddin Yassin on Friday announced that Malaysia would invest RM15 billion (S$4.91 billion) over 10 years in the 5G network. The government will set up a special purpose vehicle that will own the spectrum and manage the network, he said.

Malaysia is backing Huawei for its 5G development, something that has proved controversial in other nations after the previous US administration of President Donald Trump barred the telecom giant from 5G, citing the risk of state-sponsored spying - allegations the company has repeatedly denied.

A NEWSLETTER FOR YOU

Friday, 8.30 am

Asean Business

Business insights centering on South-east Asia's fast-growing economies.

Sign Up

Under the previous government, Malaysia said it would forgo revenue from spectrum auctions and instead allocate airwaves to a consortium of carriers that would be chosen via a tender process.

But in June last year, Mr Saifuddin revoked an order to divvy up 5G airwaves among several carriers including Telekom Malaysia, citing transparency as well as technical and legal issues.

BLOOMBERG