It appears the Malaysian authorities wish to avoid the problems licensing fees have caused elsewhere in the world. 3G auctions in both Singapore and Hong Kong have collapsed recently, with the number of licenses on offer matching the number of bidders, removing the need for bidding.
Mahathir said the government wants to ensure that operators which eventually obtain 3G licenses will be profitable so that they can be taxed later to generate revenue for the government. In a speech reported by the government news agency Berita Nasional Malaysia, he said, the government believes that getting money up front is not all that important. It is what we are going to get all the way through in the future that is important to us.
The government has said it expects to decide on how to allocate 3G licenses by the end of this year and award the licenses early next year, with a view to beginning services towards the end of 2002. The Malaysian authorities thoughtful approach approach could place the future of 3G in the country on a more secure footing.
