Malaysian think tank fails to grasp how DNB’s 5G SWN rollout works, claims UK telco consultant

KUALA LUMPUR, Dec 21 — A UK-based specialist telecommunications consultancy has disputed the contents of a recent piece by Emir Research’s Rais Hussin on DNB’s 5G Single Wholesale Network (SWN) rollout, in which it proposed reassigning the 5G spectrum to be licensed to six mobile operators.

In its response, Plum Consulting London LLP consultants Grant Forsyth, David Lewin, and Professor William Webb refuted Rais’ assumptions that the SWN involves active radio access network (RAN) sharing.

“Emir misunderstands how the SWN works. Each mobile operator will continue to innovate in their core networks in terms of the services offered, whilst buying 5G access at prices well below the cost of 4G access.

“Granted there will be no innovation in the supply of 5G RAN infrastructure because there is no infrastructure competition in this component of the network.

“But this innovation is determined largely by the relevant standards bodies and then implemented by the global network vendors,” they said in the report.

The consulting firm then refuted Rais’ claims that there will be no reduction in price as a result of deploying the SWN model rather than deploying several 5G access networks, but will in fact make it four to five times more costly.

“Rolling out six 5G networks — one for each mobile operator — would require six times as many 5G base stations.

“The unit cost per base station may be marginally lower under the six-network option. But we estimate that the overall ten-year cost of 5G network ownership under this option will be four to five times greater than under an SWN.

“This means that the end-user prices under the SWN are expected to be around 60 per cent lower than with a deployment of six 5G networks,” they said.

The firm estimated that Digital Nasional Bhd (DNB) would need more than 10,000 cell sites to provide 90 per cent population coverage by 2027.

They noted that DNB is ahead of its schedule in meeting its main rollout target of 80 per cent population coverage by the end of 2024.

It said DNB has now reached 40 per cent coverage a year after starting its network, deployment and has two more years to cover the remaining 40 per cent.

Because of that, changing from the SWN model to multiple 5G access networks could lead to substantial delay.

Contrary to Emir’s claims, Plum Consulting said the Malaysian government is only expected to contribute a modest minority share of DNB’s required funds by 2025.

“There are start-up costs of around RM800 million in the RM4 billion corporate costs. But once these start-up costs are excluded, DNB’s corporate costs are in line with other Malaysian mobile operators,” they said.

Responding to Emir’s proposal that DNB should be a neutral entity and focus in expanding passive network, Plum Consulting takes the stance that as a licensed telecommunications operator, DNB will be subject to close scrutiny and extensive regulation by the Malaysian Communications and Multimedia Commission (MCMC).

“MCMC will monitor DNB’s progress against its plan and regulate the way it supplies wholesale 5G services to licensees in terms of both price and non-price supply conditions.

“The quality of DNB’s operations will be subject to a minute by minute, transaction by transaction, scrutiny by the mobile operators each keen to ensure it secures the quality of service promised by DNB,” the consulting firm said.

They estimated that within a few years, DNB will be funded through a mix of private bondholders, the mobile operators and the government — with the government holding a modest minority interest.

On December 5, Prime Minister Datuk Seri Anwar Ibrahim announced that his administration will review Malaysia’s 5G roll-out plan, with an emphasis on transparency.


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