There have been significant developments on the 5G front in Southeast Asia (SEA) in the recent past. Operators and governments are making efforts to expedite service roll-outs. SEA continues to be one of the most promising areas as far as 5G is concerned and is progressing fast to realise its 5G ambitions.
Recent developments
Countries across the SEA region have undertaken a series of trials and pilots to test 5G technology. Singapore has been at the forefront of the 5G revolution in the SEA region. Recently, in April 2020, the Infocomm Media Development Authority (IMDA) awarded Singtel and a joint venture set up by StarHub and M1 provisional rights to operate 5G networks across the city state. As part of this move, the regulator has allotted 100 MHz of 5G-suitable spectrum in the 3.5 GHz band each to Singtel and the StarHub-M1 JV. Going forward, the IMDA is also planning to allocate millimetre wave spectrum (mmWave) to mobile network operators for the provision of high capacity 5G hotspots on a localised basis, with each assigned 800 MHz of the mmWave spectrum band. Earlier, in February 2020, Singapore’s new fourth mobile operator TPG Telecom (Singapore) had selected Japanese counterpart Rakuten Mobile to help it run joint 5G OpenRAN trials on a new network in the city state.
While Singapore has been leading in 5G deployment efforts, Malaysia has not been far behind. In January 2020, the Malaysian Communications and Multimedia Commission published a final report on the allocation of spectrum, including frequencies suitable for 5G. Around the same time, Telekom Malaysia (TM) carried out stand-alone dedicated 5G network mode test using 700 MHz and 3.5 GHz (C-band) spectrum simultaneously on a converged 5G core network. TM has been pursuing its 5G ambition with much rigour and has reportedly embarked on a total of 11 use cases in Langkawi. Further, the operator has also deployed 5G Command Centre in the same district. Moreover, various industry players are working towards boosting the infrastructure for 5G.
Thailand is yet another country that has been quick to jump on to the 5G bandwagon. Both the government and telecom operators have taken strides to launch 5G in the country. In February 2020, the National Broadcasting and Telecommunications Commission completed its 5G multiband spectrum auction. Following the completion of the sale of 5G spectrum, AIS launched its 5G service using frequencies in the 2600 MHz band. DTAC also announced plans to launch 5G broadband services on its newly acquired 26 GHz band in selected locations by the first half of 2020. In another development, True Corporation has selected Ericsson as its 5G RAN vendor. As part of this partnership, Ericsson will provide products and services from Ericsson Radio System to enable True to operate 5G on 700 MHz, 2.6 GHz and 26 GHz frequencies in the North, Central West and Upper South regions of Thailand.
Vietnam is perhaps one of the few countries that is focusing on developing domestic 5G capabilities. The country’s largest telecom operator, Viettel, which was handed the country’s first licence to trial 5G in January 2019, is planning to introduce 5G services in June this year, using network equipment and software it has developed on its own. Following this launch, Viettel aims to enable 5G across its mobile network within 12 months. The telco had also carried out trials for this purpose in September 2019. The country’s other incumbent players are not far behind. In March 2020, MobiFone successfully completed 5G trials in the cities of Hanoi, Da Nang, Hai Phong and Ho Chi Minh City. Similarly, VNPT-Vinaphone has also been piloting 5G services in Ho Chi Minh City since September 2019.
In Indonesia too, all major telecom operators have been testing 5G technology. In October 2019, Nokia and Hutchison 3 Indonesia (Tri) completed an end-to-end live 5G network trial in Indonesia.
Tapping the 5G business opportunity
Telcos are extremely optimistic about the new business opportunities that 5G will generate. Better network speeds and new-age industry use cases are the two parts that complete the 5G equation and make it a valuable proposition.
Operators have been exploring avenues and forging partnerships to develop 5G industry use cases. For instance, in November 2019, Telekom Malaysia and Huawei Technologies signed an MoU to collaborate on a variety of use cases ahead of the launch of commercial 5G services in Malaysia. As part of this partnership, the two companies are working together in a number of areas, such as the deployment of fixed wireless access technology; vehicle-to-vehicle/vehicle-to-infrastructure (V2X) solutions; and the study of smart cities. Further, they are also exploring future cooperation opportunities relating to the deployment of a full-fledged 5G end-to-end system. Similarly, in March 2020, Singtel collaborated with Nokia to develop and test 5G network slicing capabilities. Through these trials, the telco aims to develop 5G use cases in areas such as cloud gaming, manufacturing, and maritime operations. In December 2019, Singapore’s second largest mobile operator by subscribers, StarHub, signed a memorandum of understanding with the National University of Singapore to jointly develop innovative AI and VR solutions over the former’s 5G network.
The east-west pull for 5G SEA market
According to a report by AT Kearney, 5G promises to fuel the next wave of growth in SEA and the operators in this region have an annual unconstrained additional revenue potential of $4.5 billion to $6 billion by 2025. Given the immense opportunity the SEA market presents, a tug of war has been going on between the vendors from the eastern and western parts of the world for this market.
On the one hand, the US has continued to press allies in Southeast Asia not to partner with Huawei in building their 5G networks, highlighting security concerns in doing so. On the other hand, Huawei already enjoys a long-standing presence in the region and has the advantage of being a low-cost provider of 5G technology. In fact, some countries in the SEA region have openly dismissed any security risks in deploying Huawei technology for 5G development. Malaysia is a case in point. The country has been actively engaging Huawei in various trials.
However, there are some countries that are totally averse to listing Huawei as their 5G partner. Vietnam, which is embroiled in a maritime dispute with China, has so far beenfocusing on developing its own 5G capabilities. This is a potential market that can be explored by the US or other western vendors.
There are also a number of countries in the region that have chosen not to take sides and are observing a neutral stance. Thailand, for instance, is engaging both Huawei and Ericsson for its 5G roll-out.
Still a long way to go
According to an Opensignal report, current 5G networks have limited reach in the region and the vast majority of users are still relying heavily on 4G. Further, the economic disparity among the countries in the region cannot be overlooked. Per capita GDP in the region varies widely. While there are wealthy countries like Singapore at one end of the spectrum, the other end of the spectrum includes lesser developed countries like Cambodia and Myanmar. This disparity in the financial and economic standing of the countries will play a decisive role in determining how 5G progresses in the SEA region as a whole.
