KUALA LUMPUR – Malaysia’s five major mobile operators signed a deal on Dec 1 to take up to 70 per cent equity in the country’s state-owned 5G agency Digital Nasional (DNB), ahead of a plan to set up a second 5G network.

Malaysia announced in May it would move to a dual network model from 2024 as part of a government effort to dismantle monopolies, in a plan that could open its 5G rollout to new players such as China’s Huawei Technologies.

Maxis, CelcomDigi, Telekom Malaysia, U Mobile and YTL Communications, through its parent YTL Power International, will pay about RM233 million (S$66.5 million) to take up about 14 per cent equity each in DNB, the agency said in a statement.

Communications Minister Fahmi Fadzil said the firms will assist the state agency to reach 80 per cent network coverage, after which some of the companies would separate from DNB to form the second 5G network.

“The government will still have a golden share of 30 per cent in DNB. It will not have a stake in the second network, which will be completely commercial,” Mr Fahmi told reporters at a signing ceremony.

Malaysia in 2021 unveiled a plan for DNB to own the full 5G spectrum, with various carriers using its infrastructure to provide mobile services, but the plan came under industry criticism over pricing, transparency and monopolistic practices.

In May, the government said it would allow a second 5G operator in 2024 when DNB’s coverage reaches 80 per cent of populated areas. It remains unclear how the plan would affect DNB’s existing agreement with its development partner, Swedish telecoms giant Ericsson.

Prime Minister Anwar Ibrahim in September said the switch to a dual network could allow participation by China’s Huawei and provide Malaysia with a balance of Eastern and Western technology.

This was despite warnings by the European Union and the United States that a second network could pose national security and investment risks, amid efforts by Huawei to bid for a role in Malaysia’s telecoms infrastructure. REUTERS