Ericsson Malaysia Appointed to Build 5G Infrastructure

Jul 2021

Digital Nasional Bhd (DNB), the government-owned special purpose vehicle (SPV) that is undertaking the deployment of the 5G infrastructure and network nationwide, announced that it has appointed Ericsson (Malaysia) Sdn Bhd to design and build the National 5G Network in Malaysia. This comes after a rigorous tender exercise initiated in March which reportedly attracted eight bids from global telecom giants including Nokia, Huawei, ZTE, Samsung, NEC, Cisco, and Fiberhome, aside from Ericsson.

In announcing the result, DNB informed that Ericsson has offered to deliver the project at a total cost of MYR 11 billion (USD 2.59 billion). The cost will not be borne by the government and is lower than the initial budgeted cost of MYR 15 billion (USD 3.54 billion). According to DNB, Ericsson has undertaken to arrange financing mechanism for the supply, delivery, and management of the entire 5G network, while DNB will securitize future cash flows from its wholesale business via Sukuk programs to finance all other network operating expenditure and to repay all the vendor financing arrangements.  The revised cost included tower rental and fiber leasing, of which over 60% was expected to benefit Bumiputera and other Malaysian contractors over the next ten years. Ericsson will also undertake the design and development of the end-to-end 5G network comprising core, radio access and transport network (RAN), operation and business support systems (OSS/BSS), and managed services. In addition, Ericsson will take on capacity building and innovation programs to support local vendor development and participation, as well as to boost 5G adoption among the public, on top of developing use cases to accelerate industry participation.

DNB Chairman Datuk Asri Hamidon asserted that the plans remained on track as the 5G network and ecosystem were scheduled to be launched by end of 2021 in Kuala Lumpur, Putrajaya, and Cyberjaya, and will be deployed to five major cities and districts in Selangor, Penang, Johor, Sabah and Sarawak by 2022, followed by nationwide to cover 17 cities and rural areas from 2023, with 80% population coverage goal by 2024. DNB also clarified that the 5G adoption in Malaysia will focus on providing three key service offerings namely enhanced mobile broadband (eMBB), Ultra-Reliable Low-Latency Communication (URLLC), and massive Machine Type Communications (mMTC) targeted at industries such as oil and gas, ports and airports, government services, banking and finance, healthcare, power and utilities, manufacturing, education, retail, and agriculture. Equally important to DNB is the need to safeguard users and platforms through enhanced security, which is a critical element of 5G technology and services.

(Sources: The Edge Market; The New Straits Times)

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