Summary Bullets:
- Malaysia is a step closer to seeing commercial 5G, with the various live trials and commercial partnerships by the regulator and telcos.
- 5G could drive the current fixed-mobile convergence trend in the country. However, spectrum availability remains unclear and could delay the commercial availability of the technology.
The 5G Race Is Heating Up
The regulator, MCMC, has been proactive in driving 5G in Malaysia. It has created – and leads – the 5G working group, which facilitates collaborations to roll out 55 5G use cases across 32 cities, and it is looking to bring forward spectrum allocation for the technology from 2021 to the second half of 2020. Apart from the various initiatives by the regulator, the telcos are beefing up their preparations for the technology. The mobile market leader, Maxis, signed a partnership with Huawei in October to deploy 5G and co-develop use cases. Celcom is collaborating with Ericsson and UTM KL (a university in Kuala Lumpur) to launch a live trial on the university campus and drive the research and development of 5G use cases. Digi is partnering with Cyberview (a technology hub enabler) to launch 5G OpenLab to co-create 5G applications in the smart city vertical. TM, the fixed-line incumbent, announced its partnership with Huawei on 5G commercialization, and it plans to be the first telco to deploy a 5G standalone (SA) network. The telcos also recently kicked off their respective live 5G trials as part of the MCMC initiative, e.g., Celcom’s 360-degree 4K surveillance in Langkawi, Maxis’ AR experience at Aquaria KLCC, and TM 8K VR and Smart Tourism.
Perspective
The high penetration of mobile data (over 80% of the total mobile subscribers) and the adoption of 4G (around 75% of the cellular users) show that the Malaysia operators need to evolve their networks to 5G to cope with demand for data. With a five-fold increase in the last three years from 2.6 (in 2016) to 12 GB per user, per month in 2019, Malaysia also has one of the highest mobile data usages in the region. This further drives the need for 5G in the country, especially for the telcos to offload their current network capacity and address the rapid growth of user data demand.
For the telcos, 5G is not just about bandwidth and latency for the mass market or consumer. There is currently an increase in the fixed-mobile convergence trend, where the mobile players are beginning to offer fixed services and expanding their enterprise portfolio. 5G will enable various new enterprise applications across different verticals and could be a strong tool for the telcos to differentiate in the fixed-mobile market. For example, Digi (a mobile telco) could use 5G to offer a fiber-like experience to enterprises without having to build the fixed-line infrastructure, while TM (a fixed incumbent) could strengthen its enterprise mobility portfolio by providing mission-critical IoT applications (e.g., public safety) or a private mobile network. For this, the telcos need to drive more co-creation initiatives across different industries through partnerships, innovation labs, and trials. This will not only provide the telcos with the relevant experience and skillset, but also educate the market about the industry changes that 5G will be driving.
While 5G is a logical evolution to 4G, there are various moving parts that need to be addressed by the regulator and the telcos for commercial deployment. With all the live trials and partnerships announced by the telcos as well as the increasing number of 5G devices, the Malaysian market is quite ready for the new network. However, spectrum readiness is still the main inhibitor for the telcos to launch commercial services. While the regulator has been proactive in making the spectrum available, moving the timeline from 2022 to the second half of 2021, it was just an early announcement and the regulator has been known to delay spectrum plans in the past (e.g., 700 MHz and 800 MHz).
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