Malaysia’s 5G story has reached a defining moment one where consequences are no longer theoretical, deferrable, or politically convenient. The sharp decline in network performance and the Ministry of Finance’s financial exit from the national 5G project are not isolated developments. They are interconnected outcomes of a structural policy decision that prioritised speed over sustainability.
For years, EMIR Research warned that Malaysia’s Single Wholesale Network (SWN) model executed through Digital Nasional Berhad (DNB) was economically fragile and technologically misaligned with how modern telecommunications networks actually scale. Today, the data has caught up with those warnings.
This is not a story of bad luck. It is a case study in predictable outcomes.
The Data Has Spoken And It Is Unforgiving
Two developments have crystallised the failure of the SWN experiment:
- RM983.6 million in liabilities have been transferred from Ministry of Finance Malaysia (MoF Inc) to private telcos CelcomDigi, Maxis, and Yes through the exercise of a put option. This was not an asset sale. It was a forced balance-sheet transfer.
- Median 5G download speeds have collapsed by nearly 50%, falling from 451.79 Mbps in late 2023 to 242.92 Mbps in Q3 2025, according to Ookla.
These outcomes were foreseen. They were modelled. They were published. And they were ignored.
When Spectrum Becomes a Tax, Not a Catalyst
The fundamental flaw lay in treating spectrum as a rental asset rather than a strategic investment tool.
Under DNB’s model, Mobile Network Operators (MNOs) were forced to absorb wholesale spectrum costs directly into their marginal operating expenses. This converted spectrum fees into a de facto tax on data usage creating economic deadweight loss across the digital economy.
5G is not profitable because it covers land. It is profitable because it supports usage at scale. As adoption surged—nearly 80% of tests now occur on 5G-capable devices network utilisation skyrocketed. But the network was never densified for that reality.
The result? Congestion, throttling, and falling speeds. Not because Malaysians used too much data but because the system was never designed for success.
A Middleman Model With Maximum Risk
DNB was structured as a wholesaler that owned little, operated less, and outsourced almost everything yet accumulated billions in long-term obligations.
When cash-flow stress emerged, the outcome was inevitable: liabilities had to go somewhere. They did not to the market, but to shareholders, including GLIC-linked funds such as EPF, KWAP, and PNB.
This was not privatisation. It was risk relocation.
The government may have exited, but the cost has not disappeared it has merely changed hands.
Coverage Is Not Experience And Malaysians Know It
On paper, Malaysia boasts over 80% 5G Coverage of Populated Areas (COPA). In reality, performance tells a different story.
- Median upload speeds barely exceed advanced 4G levels
- Over 67% of connected time still falls back to 4G
- Indoor and rural coverage remains inconsistent
The reason is architectural: DNB’s rollout was macro-cell heavy, outdoor-focused, and under-densified, ignoring the fact that nearly 80% of mobile data is consumed indoors.
Maps looked impressive. User experience did not.
Dual Networks, Same Structural Risks
The introduction of a second 5G network signals policy recognition but not resolution.
Replacing one monopoly with two wholesale entities does not automatically restore the infrastructure-based competition that drives continuous improvement. Spectrum remains centrally controlled. Operators still lack full RAN ownership. Investment incentives remain muted.
Without restoring genuine competition at the network level, Malaysia risks repeating the same mistakes—only at higher cost.
The Bigger Lesson: Evidence Is Power
This is not an argument against 5G. Nor is it an argument against state involvement in strategic infrastructure.
It is an argument for policy humility.
Telecommunications networks are living systems. They respond to incentives, competition, and scale. When those forces are suppressed even with good intentions systems become brittle. And when demand arrives, failure follows.
Yet within this reckoning lies opportunity.
Malaysia now has something more valuable than hindsight: proof. Proof that evidence matters. Proof that competition drives quality. Proof that listening early is cheaper than fixing late.
If these lessons are embraced, Malaysia’s 5G story does not have to end in failure. It can still become a case study in course correction, institutional learning, and national resilience.
