KUALA LUMPUR – Malaysia’s lower-income groups would be further left behind in the digital divide if access requirements to 5G broadband are financially higher than the current 4G spectrum, said consumer advocates.

Federation of Malaysian Consumers’ Associations (Fomca) chief executive Saravanan Thambirajah said this is why the country’s telecommunications providers must offer the cheapest rates and packages possible, as the majority of Malaysians are wage-earners who are struggling with the rising cost of living.

On average, Malaysians pay about RM2 per gigabyte of 4G broadband data, while mobile network operators (MNOs) maintain the current generation network at between 45 sen and 55 sen per gigabyte.

However, the 5G cost per gigabyte proposed by government-run single wholesale network provider, Digital Nasional Bhd (DNB), is substantially lower, as it is capped at around 20 sen per gigabyte or less.

“If you look at the population, you will find that most mobile users are pre-paid users because they prefer not to make monthly commitments,” Saravanan told The Vibes when contacted recently.

“They (pre-paid) users have more of a ‘pay-as-you-use’ approach to using mobile data, but they consequently end up paying more money for a less amount of data.”

Saravanan was asked about the effects of the pricing of 5G services in the mass market as the country begins to roll out the new technology and amid a tussle between MNOs and the government over whether DNB should be the sole infrastructure provider.

Taking into account inflation and the increase of prices for other necessities such as food, Saravanan said the B40 group and those in the middle-income bracket are coping with the economic hardships brought on by the Covid-19 pandemic.

Furthermore, he said that with the prices of 5G-enabled smartphone devices still off-limits to much of the nation’s poor and middle-class segments, only the well-heeled customers from the T20 group will be able to enjoy the much faster mobile broadband speeds.

“Many of these devices are purchased via credit or instalments. And this would put a strain on the monthly expenditure of households,” Saravanan said.

Unlikely for telco consortium to match DNB’s rate, analysts say

Analysts had earlier suggested that it is not possible for the dual wholesale network mooted by MNOs to match DNB’s 20 sen or less per gigabyte guarantee. 

This is because DNB, as a government-run company, operates on a non-profit basis, allowing it to sell data almost at a cost price. 

However, the analysts noted that a consortium made up of Maxis Bhd, DiGi Bhd, U Mobile Sdn Bhd, and Axiata Bhd have been silent on the charges to be passed on to consumers.

They said it was unlikely the companies could match DNB’s offering, as they need to invest heavily in infrastructure.

During a talk titled “5G: What Is The Best Way Forward for Malaysia?” organised by Universiti Malaya’s Computer Association recently, Jaring CEO Datuk Mohamed Awang Lah – affectionately known as the “father of Malaysian internet” – said the country’s overall savings in 5G technology investment would increase if the MNOs shared infrastructure.

Mohamed noted that telcos, which are profit-driven companies, can remain competitive and innovative despite sharing “passive” infrastructure such as communications towers and fibre optic cabling.

The internet pioneer also noted that this would benefit users in rural and less populated areas where the telcos were less-inclined to service.

His remarks came ahead of a final cabinet decision on the single wholesale network, which is expected to be made by early this month.

Prioritise consumers’ needs before telcos, activist urges govt

Meanwhile, Malaysian Muslim Consumers’ Association chief activist Datuk Nadzim Johan echoed Saravanan’s view, saying the government must put the needs of consumers before the telcos.

He said this is because the companies are already raking in billions in profits annually, while the consumers tend to be “oppressed” and are at the mercy of the services provided, whether good or bad.

“Sometimes our phone lines are cut off and you do not even hear anything. 

“The government must ensure that the reasons behind (telcos) wanting to build their own (5G) lines are not based on greed. 

“Otherwise, things might be even better off in (less-developed) Bangladesh,” he told The Vibes when contacted.

The Malaysian Communications and Multimedia Commission (MCMC), as the relevant regulatory body, he added, “must set the tone” as the telcos are answerable to the government.

“The Communications and Multimedia Ministry must also always be on the side of the consumers (when making such decisions).”

Nadzim also said the MCMC, which issues operating licences for mobile communications, must ensure that telcos are accountable and fined for any offences.

“Even if they bought 5G data from DNB at 20 sen, how do we know of the charges to be paid by consumers? 

“As it is, they are charging RM2 and doing as they please, while the consumers are the ones affected by these measures.

“And why make new towers when they can be shared? It does not make sense.”