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Why did Saifuddin Abdullah assign 700MHz 5G spectrum to 5 telcos?

[ UPDATE 3/06/2020 17:00 ] The Communications and Multimedia Minister has retracted his order on the 700MHz spectrum assignment. More details here.

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Malaysia’s newly-minted Communications and Multimedia Minister Datuk Saifuddin Abdullah has ordered the MCMC to assign the 700MHz 5G spectrum to 5 individual telcos. The ministerial order was dated 15 May and it has named Altel, Celcom, Digi, Maxis and TM as the allocated license holders for the 700MHz spectrum.

The order was made under Section 7 of Communications and Multimedia Act 1998 [Act 588] which allow the Minister to issue directions to the Commission.

From the list, the 5 telcos will receive the following spectrum blocks:

Altel Communications Sdn Bhd – 713MHz-718MHz and 768MHz to 773MHz (2x 5MHz)

Celcom Axiata Berhad – 723MHz – 733MHz and 778MHz to 788MHz (2x 10MHz)

Digi Telecommunications Sdn Bhd – 703MHz – 713MHz and 758 MHz – 768MHz (2x 10MHz)

Maxis Broadband Sdn Bhd – 733MHz – 743MHz and 788MHz to 798MHz (2x 10MHz)

Telekom Malaysia Berhad – 718MHz – 723MHz and 773MHz – 778MHz (2x 5MHz)

Celcom, Digi and Maxis will receive bandwidth of 2x 10MHz for the 700MHz spectrum while Altel and TM will receive 2x 5MHz. According to the letter, the assignment takes effect immediately but the Minister has the right to change, modify or cancel the order. It isn’t clear if this spectrum assignment is permanent or temporary for testing purposes.

When MCMC had announced its 5G bands for Malaysia in January 2020, they have mentioned that the 700MHz and 3.5GHz bands will not be allocated to individual licensees. Instead, it will be assigned to a consortium to help lower capital expenditure (CAPEX) by minimising cost and to reduce duplications of network infrastructure.

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At the moment, we do not know if the consortium approach for 5G spectrum assignment is still maintained under the new Perikatan Nasional administration. The 5G assignment via a consortium was meant to be done through a bidding process which will allow multiple consortiums to bid for it.

Current Mobile Spectrum assignment. Source: MCMC

In addition, the assignment of the 700MHz spectrum isn’t limited to 5G usage. The MCMC has clarified to us previously that it is possible for telcos to utilise the 700MHz band for LTE which can help improve coverage for existing 4G networks. With Dynamic Spectrum Sharing, telcos could utilise 700MHz for both 4G and 5G usage.

We have reached out to the MCMC for further clarification on the matter and we will update once we have new updates.

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Alexander Wong