BUSINESS

HIGHER DEMAND FOR MOBILE, BROADBAND EXPECTED AT END-PHASE ONE JENDELA INITIATIVE -- KENANGA RESEARCH

18/01/2023 11:42 AM

KUALA LUMPUR, Jan 18 (Bernama) -- The demand for local mobile and broadband will be supported with the wider coverage at the end of phase one of the National Digital Network (Jendela) initiative at end-2022, said Kenanga Research.

It said under Jendela, targets were set such as nine million premises with access to broadband, 100 per cent Internet coverage in populated areas and 100Mbps (megabits per second) mobile broadband speed by 2025.

It noted that good progress has been made and certain interim targets have even been exceeded.

“As of the first nine months of 2022, its phase one target of 7.5 million premises (first half of 2022: 7.2 million) had access to fibre broadband and 95.8 per cent (versus 2022 target of 96.9 per cent) of populated areas had access to 4G coverage,” Kenanga Research said in a note today. 

The research firm said the average mobile broadband speed had also increased to 52.48 Mbps, surpassing the original phase one target of 35 Mbps.

In enhancing the overall digital infrastructure, 2.48 million premises enjoyed fibre connectivity compared with 2.24 million in the first half of 2022 (1H 2022), 36,000 stations upgraded to 4G technology from 34,000 in 1H 2022, and 839 locations had satellite connectivity as of the third quarter of 2022.

Kenanga Research said players like Digi.Com Bhd look set to benefit from the wider coverage, reaching the remote corners of Malaysia and the return of migrant workers.

Meanwhile, telco infrastructure providers, namely OCK Group Bhd and Edotco Group, ride on the massive spending on telco infrastructure both domestically and in the region, it added.

It also believed that the telco sector could also be poised for a re-rating if the new government is to abandon the current single wholesale network (SWN) model for the 5G rollout or revise the existing terms to the advantage of the mobile network operators. 

To recap, the monopolistic SWN model for the 5G rollout was the key culprit behind the sector’s de-rating over the last two years, it said.

On the other hand, the research firm noted that there might be concerns over more cuts in broadband rates with the Pakatan Harapan coalition leading a “unity” government after the 15th general election.

“Nevertheless, we see a low risk of this happening as after the steep cut in 2018, broadband package prices in Malaysia now average at US$33 per month (from US$45 in 2017) or US$0.14 per mbps which fall within the range of US$31 to US$258 per month in neighbouring countries,” said Kenanga Research. 

-- BERNAMA


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