Digi and Celcom has signed Mou for network and infrastructure collaboration in Malaysia,the first of it kind in Malaysia between large and competing company. Thumbs up to both companies for taking such moves that I’m sure will benefit both parties.

For Digi this timely move will hopefully boost their 3G coverage to all over countries with extensive and wide coverage Celcom network had (if that is part of the MoU). Meanwhile Celcom may gain from the innovative product/package Digi has in it’s offering and probably iPhone in Celcom networks, perhaps?? Just wild guess though, but as someone who use both services, I’m seeing this in positive way on how it will benefit user.

On the other side, the move by 2nd and 3rd largest telco in Malaysia could also be seen as a step taking on Maxis, the largest telco in Malaysia. Maxis is the market leader for years and very strong in almost every segment such as broadband, postpaid, prepaid and now the data services. If the strategic collaboration works well, it could undercut the dominance of Maxis in local telecommunication industry.

Jump to Press Release below for more information.

Celcom and DiGi Sign MoU for Advanced Network Collaboration

KUALA LUMPUR, 10 JUNE 2010: Celcom Axiata Berhad [formerly known as Celcom (Malaysia) Berhad] (“Celcom”) and DiGi Telecommunications Sdn Bhd (“DiGi”) today announced plans to explore long-term network and infrastructure collaboration in Malaysia.

The Memorandum of Understanding (“MoU”) signed between Celcom, DiGi, and their respective major shareholders Axiata Group Berhad (“Axiata”) and Telenor Asia Pte Ltd (“Telenor”) will focus on three collaborative areas, namely operations and maintenance, transmission and site sharing, and radio access network.

The proposed active sharing model is geared towards generating significant operational and cost efficiencies for both operators by removing duplication of base station sites, addressing escalating rental fees, reducing utility bills and transmission costs, optimising deployment of base stations per area, and redeploying equipment between redundant and new sites.

The MoU is among the first such collaboration in the world with a wide and comprehensive scope. This is the first time two major network operators in Malaysia are considering extensive collaboration of network resources. A definitive agreement is expected to be reached before the end of 2010 once both parties have agreed on the long-term economic and operational viability of this collaboration.

This agreement also closely reflects an earlier accord for the sharing of network resources in Bangladesh between Axiata and Telenor Asia, through their respective operating companies Axiata (Bangladesh) Limited and Grameenphone Ltd. It signals the commitment of Axiata Group and Telenor Group to explore initiatives regarding network resources collaboration in Asia that could bring long-term significance in cost savings and environmental benefits.

The MoU was signed in the presence of the Malaysian Communications and Multimedia Commission Chairman Tan Sri Khalid Ramli. Signing on behalf of their respective companies were Dato’ Sri Shazalli Ramly, CEO of Celcom; Henrik Clausen, CEO of DiGi; Dato’ Sri Jamaludin Ibrahim, Managing Director/President and Group CEO of Axiata; and Sigve Brekke, Executive Vice President of Telenor Group and Head of Telenor Region Asia.

On the MoU, Mr. Clausen explained, “Maturing mobile markets like Malaysia can benefit from extensive network sharing as a key strategy to drive cost and operational efficiency. These efficiencies will in turn allow us to explore new and innovative ways to provide wider coverage at better costs for our customers, especially in facilitating the strong demand for data services nationwide. This is the main driver behind this collaboration, and we see clear advantages in moving forward together on a long-term, sustainable business model.”

“With higher internet penetration, networks are becoming more data-centric than voice-centric, driving an increased capacity requirement in all points of the network infrastructure. In the long run, it is more practical to explore other alternatives to address this shift in trend. This collaboration is a new milestone not only for Celcom and DiGi, it is also a brand new chapter for the local industry and the country, positioning Malaysia as a pioneer in network infrastructure sharing. Ultimately, we look forward to improved quality of service and increased shareholder value, benefiting both the consumers and service providers” said Dato’ Sri Shazalli.