Can Dual Networks Fix It?

• 5G coverage reached 82.4%, but network speeds fell 46% as the wholesale model buckled under demand
• The dual-network pivot raises critical questions on costs, rural connectivity, and whether competition can fix what a monopoly couldn’t

Malaysia’s 5G rollout delivered one of the world’s fastest networks in late 2023, only to watch performance collapse under its own success—raising hard questions about whether the country’s newly launched dual-network strategy addresses the root causes or simply doubles the infrastructure cost.

Malaysia’s median 5G download speed plummeted 46% from 451.79 Mbps in Q4 2023 to 242.92 Mbps by Q3 2025, according to Ookla’s analysis. Upload speeds fell 41% over the same period, from 49.87 Mbps to 29.52 Mbps.

The deteriorating performance “directly contrasts with the stable or relatively improving performance seen in several neighbouring markets,” Ookla noted, with South Korea consistently delivering speeds above 528 Mbps and Singapore near 350 Mbps.

The culprit: Digital Nasional Berhad’s (DNB) Single Wholesale Network model buckled as 5G subscriptions surged six-fold from 4.6 million in November 2023 to 28.7 million by November 2025. With all operators channelling traffic through one shared infrastructure, spectrum congestion became inevitable.

U Mobile launched Malaysia’s second 5G network in August 2025—but eight months into the dual-network era, the fundamental question remains unanswered: does splitting spectrum between two networks solve capacity constraints, or does it create new inefficiencies that perpetuate mediocre performance at twice the cost?

The capacity crunch nobody predicted

Malaysia’s 5G subscriptions exploded from 4.6 million in November 2023 to 28.7 million by November 2025—a six-fold increase in just two years. User penetration reached 53.35% by year-end 2024, according to the Malaysian Communications and Multimedia Commission (MCMC).

This rapid adoption strained DNB’s shared infrastructure, which serves all major operators, including CelcomDigi, Maxis, YTL’s Yes, and, until recently, U Mobile. When the government approved the dual-network model, DNB was forced to surrender half of its crucial 3.5GHz spectrum—reducing from 200MHz to 100MHz—to accommodate U Mobile’s competing network.

DNB had warned in December 2022 that splitting the spectrum would degrade performance and require an additional 8,000 sites costing RM5.4 billion to maintain service quality. By October 2025, the government issued Ministerial Direction No. 7, allocating an additional 100MHz spectrum (3.3GHz to 3.4GHz) to DNB in a belated attempt to address network constraints.

“Certain spectrum was taken away from us, but now, it is being reassigned to DNB,” DNB CEO Datuk Azman Ismail told The Edge. DNB’s Chief Technology Officer Ken Tan noted that as of October 2025, 84.2% of 5G traffic from nearly 29 million users still runs through DNB’s network despite the emergence of competition.

Rural connectivity: The economics still don’t work

Ookla’s October 2025 drive testing revealed stark differences in coverage density: DNB’s network (via Yes) shows comprehensive F1-3500MHz deployment across the Klang Valley, while U Mobile’s nascent F2 spectrum deployment (orange) remains limited to select corridors.

While Malaysia’s 82.4% coverage figure sounds impressive, it masks persistent gaps in rural and remote areas. Sarawak and Sabah had 5G coverage of just 62% and 68.6%, respectively, as of mid-2025, according to government data.

Edotco delivered over 100 towers in rural states under the JENDELA (National Digital Network) initiative, but the business case for continued rural expansion without government subsidies remains unclear.

“The question for 2026 is whether the dual-network model will accelerate or complicate rural deployment,” Koralage noted, pointing to potential inefficiencies from parallel infrastructure buildouts.

Coverage also plateaued through much of 2025. The Communications Ministry first reported the 82.4% figure in February 2025, and it remained unchanged through MCMC’s updates later in the year—suggesting infrastructure challenges in less accessible regions are slowing further expansion.

U Mobile’s 2026 challenge: Building from scratch

Malaysia officially terminated DNB’s monopoly status on December 31, 2024. U Mobile, selected as the second network operator in November 2024, received its award letter in March 2025 and has partnered with Huawei and ZTE to deploy 5G-Advanced infrastructure.

The telco exited its 16.28% stake in DNB in May 2025 and committed to reaching 80% coverage of populated areas by the second half of 2026—a 15-18 month rollout timeline that industry observers view as ambitious given U Mobile’s current infrastructure base.

Controlled testing by Ookla in October 2025 revealed U Mobile subscribers still relied heavily on DNB’s infrastructure, with 83.2% of test samples connecting to DNB-managed frequencies. U Mobile’s own network accounted for just 16.8% of samples despite active deployment—underscoring the scale of the buildout challenge ahead.

The financial stakes are substantial. DNB has spent RM5 billion on network deployment, funded primarily through private borrowings with government guarantees. As part of the dual-network transition, telcos must repay the government’s initial RM950 million funding and assume government-guaranteed loans.

In August 2025, CelcomDigi, Maxis, and YTL committed an additional RM350 million into DNB (RM116.67 million each) to stabilise finances. Stock exchange filings warned that U Mobile’s competing network could divert customers from DNB, creating revenue uncertainty.

Enterprise adoption: The missing piece

While consumer uptake accelerated, enterprise integration—a key driver for Malaysia’s digital economy ambitions—lagged through 2024 and 2025. Communications Minister Fahmi Fadzil acknowledged that many SMEs have yet to fully utilise 5G’s potential, indicating a need for increased awareness and support.

Only 20% of mobile data traffic had migrated to 5G networks by mid-2025, according to industry estimates—suggesting most users aren’t experiencing meaningful differences from their 4G connections despite subscribing to 5G services.

To address enterprise gaps, DNB partnered with Ericsson in March 2025 to deploy 5G Advanced technologies across industrial zones and introduce what the companies described as the “world’s first 5G-powered mobile workspace solution” at DNB’s Kuala Lumpur headquarters.

U Mobile established an Enterprise Innovation Platform with Huawei Malaysia in September 2025. The government launched a 5G Enterprise and AI City Grant initiative under the 13th Malaysia Plan, with Prime Minister Anwar Ibrahim targeting 98% 5G coverage in populated and industrial areas, including rural regions, by 2030.

2026’s make-or-break questions

Several critical questions will determine whether Malaysia’s dual-network gambit succeeds:

Infrastructure efficiency: Can two parallel 5G networks justify their combined costs, or will tower-sharing and spectrum coordination challenges undermine the economic rationale? Koralage from EDOTCO noted that the industry could save RM10 billion through infrastructure sharing—costs that would otherwise be duplicated under the dual-network model.

Performance recovery: Will competition drive network quality improvements, or will spectrum fragmentation and parallel buildouts perpetuate the speed decline seen through 2025?

Rural connectivity: With two networks to build, will operators prioritise profitable urban markets while rural areas continue to lag? The JENDELA initiative’s rural tower economics remain unproven at scale.

Enterprise adoption: Can Malaysia translate 5G infrastructure into genuine enterprise digital transformation, or will low utilisation rates persist despite expanded coverage?

Financial sustainability: DNB faces potential customer attrition as U Mobile’s network matures, while carrying RM5 billion in debt. Can the wholesale model remain viable, or will further capital injections be required?

Regional positioning: Malaysia still outperforms several regional markets on 5G speeds, but Singapore, South Korea, and Vietnam have pulled ahead. The country ranked ninth globally in deploying 5G Advanced technology—a respectable position, but not the regional leadership initially envisioned.

The GSMA welcomed Malaysia’s transition to dual networks in February 2025, stating it would foster competition, attract investment, and spur innovation. Whether that optimism proves justified depends on execution through 2026—a year that will test whether Malaysia’s infrastructure gamble delivers on its promise or simply doubles the cost of mediocrity.

For Asia-Pacific decision-makers evaluating their own 5G strategies, Malaysia’s experience offers a cautionary lesson: rapid coverage deployment means little if network capacity, rural economics, and enterprise adoption aren’t solved in parallel. The next 18 months will reveal whether competition can succeed where monopoly stumbled.