3G Bands Announced

Malaysia : The Malaysian Communications and Multimedia Commission (MCMC) officially assigned the IMT-2000 spectrum to Telekom Malaysia Berhad (TMB) and UMTS (Malaysia) Sdn Bhd as the first step towards rollout of 3G services in Malaysia.

The MCMC has endorsed the following combination set of spectrum, or the ‘Spectrum Block’, as determined by the Minister in his Ministerial Determination No. 1 of 2002 to the two companies:

TMB
Frequency Band
1950MHz – 1965MHz (Bandwidth 15MHz)
2140MHz – 2155MHz (Bandwidth 15MHz)
2020MHz – 2025MHz (Bandwidth 5MHz)

UMTS
Frequency Band
1935MHz – 1950MHz (Bandwidth 15MHz)
2125MHz – 2140MHz (Bandwidth 15MHz)
2015MHz – 2020MHz (Bandwidth 5MHz)

The assignment of the spectrum marks the end of the long process of spectrum assignment which began in February 2002 when the MCMC issued the Applicant Information Package (AIP) No. 1 of 2002 which invited bidders to vie for three blocks of frequency bands for the provision of IMT-2000 services in Malaysia. The bid attracted five companies: Telekom Malaysia Berhad, UMTS Sdn Bhd, Celcom (Malaysia) Berhad, E-Touch Sdn Bhd, TIME Sat Sdn Bhd. Upon completion of the evaluation of the bids in September 2002, it was decided that only two blocks would be awarded, that is, to Telekom Malaysia Berhad and UMTS Sdn Bhd, pending the submission and evaluation of their Detailed Business Plans.

Tan Sri Nuraizah Abdul Hamid, Chairman of the MCMC, congratulated the spectrum assignment holders on the assignment of the spectrum blocks and reminded the two companies that they have to keep to their commitments as set out in the Detailed Business Plans.

“We very much hope that we will see the first pilot coverage in July 2003, as promised by Telekom Malaysia. UMTS, on the other hand, will be rolling out its pilot service in early 2004, coinciding with Telekom Malaysia’s commercial rollout,” she explained.

TMB’s pilot service will cover the Multimedia Super Corridor areas i.e. KLCC, the Kuala Lumpur International Airport and Cyberjaya. Targeted areas for the launch of its commercial service will cover four districts, Central, Northern, Southern and East Malaysia, in early 2004. By 2010, TMB’s 3G network is expected to cover about 80% of the Malaysian population. UMTS, on the other hand, is expected to launch its pilot service early 2004 in KLCC, Sunway, Subang Jaya, Putra Jaya and Cyberjaya, and commercial rollout towards end of 2004. By 2014, UMTS is expected to achieve about 80% population coverage.

TMB’s 3G services rollout is expected to cost RM4 billion while UMTS’ rollout is expected to cost around RM3.5 billion over the next 10 years.

Tan Sri Nuraizah said that the MCMC, as regulator, would monitor closely the two companies’ deliverables and performance, as promised in their respective Detailed Business Plans. “As a regulator, it is our role to ensure that the successful applicants deliver on the proposals they have made, however we are not unreasonable. We realise that the roll out of 3G services is a huge investment for both companies and we also realise that plans may change in the future subject to world and local economic conditions. However, as a matter of instilling public confidence, the assignment holders have to prove to the Government and the public, that the undertakings made in the Detailed Business Plans are kept and the deadlines set by them in the plans are met.”

In drawing up the AIP, Tan Sri Nuraizah reiterated that the Government was mindful that the rolling out of the facilities for 3G services was going to be costly, and the AIP was intended to promote infrastructure and services sharing in order to reduce capital outflow and stimulate the growth of the industry. The business plans, she noted, had mentioned facilities sharing and explored the possibility of service sharing which showed that the industry was embracing the convergence concept as envisaged by the Government.

The process of introducing 3G, the policy direction and implementation strategies in Malaysia, began in August 2000 when the MCMC, together with the Ministry of Energy, Communications and Multimedia established a Joint Working Group to develop recommendations to the Minister and the industry on how 3G could be implemented under the new regulatory framework as specified in the Communications and Multimedia Act 1998. This was followed by a Discussion Paper prepared by the MCMC on Concepts and Principles for the Proposed Implementation of IMT-2000 Mobile Services in Malaysia that, among others, proposed that 3G in Malaysia be regarded as a spectrum issue and, as such, would not require the issuance of 3G licences.

In November 2001, the Minister announced the policy decision and the timelines for the implementation of IMT-2000 in Malaysia. Among others, 3 spectrum blocks would be made available for bids in a tender exercise at a price of RM50 million per block; the bidding would be conducted via a “beauty contest”; and applicants would be evaluated on their proposals for service roll-out and coverage, infrastructure sharing, roaming, financial consideration, industry development, and management and technical experience. The closing date for submissions was set on 29 May 2002.

In February 2002, the MCMC released the AIP and in July, announced the two successful applicants who were then required to submit Detailed Business Plans to ensure that they were capable of fulfilling the self-imposed requirements as articulated in their bid submissions.