FORMER deputy minister of trade and industry Ong Kian Ming has urged for open tendering over direct negotiation for contracts linked to the second 5G network.

This would be consistent with the principles of transparency espoused by Prime Minister Anwar Ibrahim, he said in a statement today.

Ong said that he was stunned by Anwar’s statement last month that a second 5G network would allow China’s Huawei to have more effective participation in the sector.

Contracts should be awarded by competitive bidding and not by direct negotiation with any single entity, Huawei included, Ong said.

“Upon assuming office in November 2022, one of the first things (Anwar) did was to order an investigation into the way the current 5G network contract was awarded to Ericsson via Digital Nasional Bhd (DNB). 

“Subsequent investigations found that the contract was indeed awarded transparently. 

“It would be a disservice to the Madani way of governing if the second 5G network was awarded in a manner in which only one bidder was involved.”

In any case, Ong said, the case for a second 5G network has not been established. He said DNB appeared to have done a good job in rolling out coverage for the first 5G network, which Open Signal has ranked among the fastest in the world.  

Malaysia also topped the table for an uplift in users’ average download speeds with 5G, showing a 25.7-fold increase, he said.

“While this is partly caused by the relatively low number of existing 5G users in the country, it cannot be denied that the single wholesale network model adopted by DNB has not only been effective in rapidly rolling out 5G coverage but (in achieving) speeds much better than 4G.
 
“If both speed and coverage of the existing 5G network are more than sufficient, is there a need then for a second network?”

He said the mobile network operators (MNOs) have yet to ink the agreement to take up stake in DNB.

“This shareholding agreement is necessary to ensure commitment of the main MNOs, especially Maxis and Celcomdigi to DNB. 

“Some industry watchers speculate that the two big boys harbour intentions of killing off DNB so that its assets can be bought on the cheap and they will no longer have to pay access fees to DNB. 

“The consequence of this is that the Ministry of Finance (MOF) will be left holding the debt of DNB without the major telcos paying their share of 5G access fees which will be used to service DNB’s debt.”

This would lead to the “socialisation of losses” and “privatisation of profits” that have been seen many times in Malaysia..

“We should be keenly aware of the geopolitics surrounding the 5G issue, but we should make decisions firmly based on national interest.” – October 9, 2023.