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Tenaga Nasional & Telekom Malaysia ends MoU as it “would cause a huge monopoly”

Telekom Malaysia Berhad (TM) and Tenaga Nasional Berhad (TNB) announced that both companies have mutually agreed to discontinue a Memorandum of Understanding (MoU) signed in January 2018 to jointly develop an implementation plan to deliver on the Government’s Nationwide Fiberisation Plan (NFP).

Telekom Malaysia and Tenaga Nasional made the following announcement to Bursa Malaysia yesterday:

TM’s announcements on 16 January, 16 April and 16 July 2018 in respect of the MOU dated 16 January 2018 with TNB for the collaboration to establish a detailed joint proposal for Nationwide Fiberisation Plan (NFP) refers.

TM wishes to announce that both TM and TNB have mutually agreed to discontinue the above MOU with immediate effect.

This discontinuation however, does not preclude TM from considering other collaborations with TNB should there be future business opportunities that are beneficial to both parties.

Malaysia Communications and Multimedia Minister Gobind Singh Deo said the end to the cooperation between the two national utilities breaks the monopoly in the industry, reported TheEdge.

“It also allows them (Telekom Malaysia and Tenaga Nasional Berhad) to work independently with us and companies, to provide the infrastructure throughout the country. Several parties have voiced out their concern that if there is any cooperation between TNB and TM, it would cause a huge monopoly in the industry.

“This would be a barrier for companies to provide similar services, leading to competition and a better system,” he said in Parliament.

“We want [to] assure Malaysians that despite the termination of the fiberisation plan, the government would continue with its agenda to ensure internet connectivity nationwide,” he added.

Gobind said it has been his focus since he became the minister to ensure internet is accessible at a lower rate and higher speed, and that good quality is provided soon.

“Apart from the focus on fiberisation, we must also understand that the last mile such as rural areas, would need a wireless service,” he reiterated.

Tenaga Nasional Berhad (TNB) is the largest electricity utility in Malaysia, delivering electricity to 9.2 million customers in Peninsular Malaysia, Sabah and Labuan. Telekom Malaysia (TM) operates the High Speed Broadband Network (HSBB) and offers the Unifi fibre service.

Early last year, the Malaysian Government launched a Nationwide Fiberisation Plan (2017-2019) to connect about six million premises including an estimated two million premises in the rural areas.

As part of the Nationwide Fiberisation Plan, a 3-Tier model would be established, whereby the First Tier would involve utilising Tenaga Nasional Bhd’s fiber trunk network for wholesale backhaul services.

The Second Tier Wholesale Service Provider(s) would offer last mile access, while the Third Tier providers would comprise existing telecommunication companies offering retail services to consumers and businesses

About Kugan

Kugan is the founder of MalaysianWireless. He has been observing the mobile industry since 2003. Connect with him on Twitter: @scamboy