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Malaysia outlines complicated plan for 5G spectrum allocation

The Malaysian Government has released complicated plans to allocate spectrum ahead of 5G deployment in the country in an effort to ensure the greatest efficiencies.

Theoretically, the Malaysian Communications and Multimedia Commission (MCMC) has outlined a strategy which could bring significant benefit to the country, but there is certainly a risk this could go disastrously wrong. There are a lot of moving parts, new ideas and opportunity for abuse should the pieces not fall perfectly into place.

Starting at the top, after a consultation period, the MCMC has identified four spectrum bands for 5G services; 700 MHz, 3.5 GHz, 26 GHz and 28 GHz. This is not revolutionary, as these airwaves have been identified for 5G by other nations, but the allocation of these assets is the interesting element of this story.

Starting with the 700 MHz and 3.5 GHz spectrum bands. As opposed to going through an auction process, these licences will be assigned to a consortium formed by the various different players in the industry. With only 2×30 MHz blocks in the 700 MHz band and 100 MHz in 3.5 GHz, the consortium approach expects to make best use of the available spectrum and also intends to minimise CAPEX for infrastructure deployment across the country.

An alternative strategy for 5G infrastructure deployment is not only critical to make use of the spectrum, but also to ensure 4G investments are continued. 5G does pose a threat to the cash allocated towards continued 4G investments across the world, though in countries like Malaysia where a digital divide is very clear and present currently, the consequence could be much greater. 5G has huge potential, but 4G has a significant way to go in some markets.

What is not entirely clear, is how the telcos will work alongside each other. Investment in infrastructure will be shared, as will the spectrum resources to deliver commercial services. This is where the plan faces risk; telcos generally do not play well together, so it will be interesting to see how this play-date unfolds.

Looking at the next band, 24.9 GHz to 26.5 GHz, these licences will be assigned through a tender process, also known derivatively as a ‘beauty contest’. Although some have good intentions for this approach to allocating spectrum, it is wide open for abuse and more often than not fails to deliver on the intentions in the long-run.

The final band, 26.5 GHz to 28.1 GHz, will be assigned on a first-come first-served basis and is open to any party, not just telcos. While the 26 GHz licences will be allocated on a national basis, the 28 GHz spectrum will be highly localised. Anyone who wishes to deploy a highly localised, private network will be free to apply for a licence. Industrial, enterprise and smart city focused usecases have been envisioned here.

Like every market, Malaysia is nuanced and has to adjust spectrum allocation to meet its own wants and needs. The European or North American approach could not be applied here, and it is very encouraging to see a Government attempt to drive through innovation in the spectrum process.

Unique challenges demand unique approaches, and that is certainly what Malaysia is applying. That said, there is plenty which could go wrong. This is a process which is certainly worth keeping an eye on, as there are plenty of nations around the world who could learn from the successes and failures.

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