KUALA LUMPUR: The 5G services rollout could boost Malaysian telecom operators' annual revenues as much as RM3.764 billion (US$900 million dollars) starting 2025, according to a new study commissioned by Cisco, a global technology leader.
The study, conducted by management consulting firm A.T. Kearney, highlighted that 5G promises speeds up to 50 times faster, 10 times more responsiveness, and much lower power connectivity than 4G.
This will be driven by a combination of three distinctive features namely high throughput, ultra-low latency and low power connectivity.
Cisco Malaysia managing director Albert Chai said Malaysia’s commitment to the successful roll out of 5G can be seen through the recent 2020 Budget allocation that included RM50 million grant for the development of the 5G ecosystem.
This is in addition to a RM25 million in matching grant funds for the promotion of digital application pilot projects for fibre optics and 5G infrastructure.
"This has been complemented by a private-public sector project that will see 5G use cases rolled out on 32 sites across six states.
"Beyond that, businesses across Malaysia, especially in key sectors such as manufacturing, are looking to leverage advancements in 4IR technologies to enter a new phase of expansion.
"At the same time, consumers are also eagerly waiting for 5G rollout for enhanced experience with content consumption on their personal devices. Together, these will play a key role in boosting Malaysia’s economic growth in the coming years," Chai said.
As telecom operators get ready to roll out 5G services, they are likely to invest about RM41.83 billion (US$10 billion) into the region’s 5G infrastructure by 2025.
The study also highlighted that the Malaysian Communications and Multimedia Commission had established a national 5G task force to recommend a comprehensive strategy and policy.
Cisco president of Asean Naveen Menon said the expected rollout of 5G services came at a perfect time for telecom operators.
He said the usage of cellular data was growing rapidly as users consume increasing amount of services and content on their personal devices.
"At the same time, enterprises are looking to leverage the Fourth Industrial Revolution (4IR), which is underpinned by Artificial Intelligence, IoT, 3D Printing, Advanced Robotics and Wearables, to boost growth.
"The successful adoption of these technologies is largely dependent on the underlying connectivity. This provides a huge opportunity for telecom operators to increase their presence in the enterprise market and sustain their long-term growth," he said in a recent statement.
Speed, low latency, and enhanced connectivity through 5G will help telecom operators provide super-fast Internet connections that enable streaming of high-definition videos, cloud gaming and delivery of interactive augmented and virtual reality (AR/VR)-powered content to consumers.
It will also help to fast-track the commercialisation of several advanced use cases of 5G, including smart cities, Industry 4.0, large-scale Internet of Things (IoT) deployments, and more.
This will enable telecom operators to increase revenues both from consumers as well as enterprise clients.
The study expects 5G penetration to be around 25-40 per cent in major countries in the region by 2025, with Malaysia seeing nearly 40 per cent penetration.
The total number of 5G subscriptions in Asean is forecast to exceed 200 million in 2025.
Cisco Asean managing director Dharmesh Malhotra said the rollout of 5G services will require substantial investments in technology to modernise underlying networks.
"In Asean, telecom operators are likely to continue to invest in upgrading their 4G networks and build the 5G capabilities in a phased manner.
"This will allow 4G and 5G to operate simultaneously and help the operators manage their capex and ROI in a sustainable manner. Cisco is partnering with network operators in their journey to 5G rollout and is already engaged with customers in Asean on 5G transformation," he said.
The 5G will be deployed across multiple bands, with three bands likely to be important globally in the near-term: low band (700 MHz), mid-band (3.5 to 4.2 GHz), and high-band on mmWave spectrum (24 to 28 GHz).
In Asean, many of these bands are already being used to provide other services. Low band is being used for FTA TV, and mid-band is being used for satellite services.