Spectrum sharing post-merger improves Digi’s 4G network

It has been almost a year since shareholders approved the merger of two Malaysian national operators, Celcom and Digi, in mid-November 2022, to form CelcomDigi — the separate brands of Celcom and Digi will continue to exist for now. Since then, CelcomDigi has started to integrate the two networks, to provide a more robust and modernized network that benefits from the strengths of both. One of the ways in which the combined network is achieving this is through sharing their spectrum assets — including the deployment of 900MHz spectrum at all sites to boost coverage.

In this latest Opensignal analysis we compare our users’ readings on Digi’s network, for the three-month periods just after the merger and six months later, to ascertain how Digi is utilizing the new spectrum assets. The proportion of Digi’s readings on spectrum blocks originally owned by Celcom have increased considerably, and both 4G Download Speed and 4G Video Experience have shot up on the 900MHz band. This has contributed to a large rise in Digi’s overall 4G scores, translating into a better overall mobile experience for our users.

CelcomDigi owns spectrum across four bands — 900MHz (3GPP 8), 1800MHz (3GPP 3)), 2100MHz (3GPP 1) and 2600MHz (3GPP 7). Back in February, integration between the two operators was in the early stages, and our Digi users’ 4G download readings were overwhelmingly on spectrum blocks originally owned by Digi — the band with the highest percentage of readings coming from spectrum originally owned by Celcom was the 1800 MHz band followed closely by the 900MHz band, at 7.1% and 6.9% respectively.

Out of these four bands, band 8 has seen the largest proportional increase in usage between the two data collection periods. The usage of Celcom’s 900MHz spectrum by our Digi users has more than tripled, rising to almost a quarter of readings, with the 1800MHz and 2100MHz bands seeing similarly large upswings of 12.4 percentage points and 15.4 percentage points, respectively. Digi’s readings on the 2600MHzare still almost completely on Digi’s own spectrum block. Even so, Digi’s readings on the 2.6GHz block owned by Celcom have more than tripled, from 0.5% to 1.7%.

The 900MHz band is important for nationwide coverage and indoor penetration. However, it has limited capacity, with Digi originally owning just 5MHz of downlink bandwidth. The merger of Celcom and Digi has effectively tripled Digi’s downlink spectrum capacity in the 900MHz range, from 5MHz to 15MHz, while the increase for Celcom is a more modest 50%.

Increased spectrum capacity has positive effects on the speeds that users experience, both on that specific band and overall. Average download speed using the 900MHz as the primary band has increased by an impressive 6.1Mbps (54%) since the earlier collection period. The speed increases aren’t just on band 8 though — overall 4G download speeds have also increased significantly. Improvements on all four bands have contributed to our Digi users’ overall 4G download speeds increasing by 9.8Mbps (42.8%) on average, taking them above 30Mbps.

It isn’t all just about fast speeds when downloading files — long loading times and frequent stalling when trying to stream video can quickly sour the user experience. Once again there is a significant jump in score between the data collection periods on the 900MHz band. The 4G Video Experience score increases five points, reaching 46.6 points on a 100-point scale in the more recent period — bringing the band 8 4G Video Experience score very close to the Fair (48-58) category. Combined with the improvements in coverage that the band is set to provide, this will be a large boost to the minimum expected performance.

The overall 4G Video Experience has also improved substantially. The 4.8-point jump takes Digi’s score comfortably into the Good (58-68) category. A Good rating means that our users are, on average, able to stream video at 720p or better with satisfactory loading times and little stalling.

Integration is not an instant process. As time goes on, we can expect the two operators to make even more use of their combined spectrum assets. Opensignal recently published an analysis into how greater spectrum bandwidth usage can boost 4G download speeds — showing that not only speeds, but also user experience when mobile gaming or streaming video increase with the amount of bandwidth. With carrier aggregation CelcomDigi can combine its spectrum blocks to enhance the user experience.

In Italy we have seen the merger of two operators shake up the marketplace, with the merger of Wind and 3 into WindTre proving greater than the sum of its parts — going from winning no awards to second most awarded. Digi and Celcom already provide fierce competition in the Malaysian market. Both operators take home large award tallies, going toe-to-toe with the other Malaysian operators. If CelcomDigi can combine the strengths of each operator, they are poised to thrive in the competitive Malaysian market. 

Having said that, CelcomDigi cannot make use of all its combined spectrum in the long-term. The merger has necessitated the combined entity to return spectrum holdings to address competition concerns. Over a three-year period, CelcomDigi will return 70MHz of spectrum covering the 1800MHz, 2100MHz and 2600MHz bands. This will leave them with a total of 150MHz of spectrum, still far more than the closest competitor — Maxis with 115MHz.

Opensignal will continue to closely monitor Celcom and Digi’s progress and the entire Malaysian market in our regular mobile network experience reports. You can get up to date with the most recent September 2023 report.