This article appeared in The Edge Markets on 18 November 2021.

KUALA LUMPUR (Nov 18): The setting of the price to obtain three spectra to roll out the national fifth-generation (5G) network in the country is done through consultation with the Malaysian Communications and Multimedia Commission (MCMC) using the "reference access order" (RAO) method, the Dewan Rakyat was told.

Communications and Multimedia Minister Tan Sri Annuar Musa said the method is to ensure that the price would not be not too high for consumers when the 5G network is launched next month.

“It is not up to DNB (Digital National Bhd) to set the price, which may be high, and then charge it on the MNOs (mobile network operators), and neither can the MNOs set their own price for it.

“RAO negotiations are still ongoing and only after the pricing is set, the 5G roll-out can be inked with MCMC approval, but so far, the MCMC has yet to give approval for the price,” the minister said during question time.

Annuar said this in reply to Ahmad Fahmi Mohamed Fadzil (Pakatan Harapan-Lembah Pantai) who wanted to know how much is the opportunity cost for the government compared to using the option to auction off the 5G spectrum to telecommunications companies for the transition from 4G to 5G.

“The opportunity cost for the government is a non-issue as the 5G roll-out is not using any government fund because it is arranged by the private sector.

“It also does not use the wholesale concept to avoid unreasonably high prices for consumers,” he said.

Elaborating, Annuar said if the acquisition of the spectrum is made through an auction, it would affect consumers because the higher the auction price, the more expensive the 5G network charge would be for them.

He said this would contravene the government's target to ensure that the price for 5G is not higher than the price for 4G.

Apart from that, he said through the introduction of the multi-operator core network (MOCN) system in the 5G roll-out, Malaysia had become the first country in the world to have this system shared by five or six MNOs through one apparatus.

“In most countries, the MOCN is being used by a maximum of two or three operators, but I have been shown that [in Malaysia,] it can be used by five or six operators as one apparatus.

“This was demonstrated to me by DNB as an example of how the cost can be reduced when MOCN integration is done when the 5G roll-out is launched,” he added.

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