Maxis fiber deal doubles Melaka tower backhaul coverage

The radio tower is the visible half of a mobile network. The half that carries traffic off the tower into the network core is the unglamorous middle layer that Malaysian carrier Maxis has now been selected to rebuild in Melaka.

Melaka ICT Holdings (MICTH), which controls a portfolio of telecom towers in the state, has picked Maxis to support a digitalization program, according to Data Center Dynamics. The work will move MICTH-owned sites from microwave backhaul to high-capacity optical fiber, lifting fiber connectivity across the tower estate from 40 percent of sites to 80 percent—a shift covering 151 towers and an investment of around RM30 million ($7.4 million).

The stated rationale is 4G and 5G reliability. MICTH chief executive Dr. Nazdiana binti Ab Wahab said the collaboration will accelerate the migration of MICTH-owned telecommunications sites from microwave to fiber, improving network performance and supporting growing digital demand; Maxis chief executive Goh Seow Eng went further, describing the fiberization as the foundation of a future-proof ecosystem and citing the scalability needed to keep pace with an exponential rise in data demand, including AI traffic.

In dollar terms the Melaka deal is small, the kind a single hyperscaler can burn before lunch on a data center campus, but the structure says more about the AI buildout than the price tag does. The heavy computing happens inside data centers, yet the traffic has to travel from the tower through the backhaul network to the core, and in many markets that route still runs on microwave. Microwave links move less data and add more latency than a fiber connection, which is exactly why an operator pushing 5G and AI traffic would treat the upgrade as a prerequisite.

Maxis is upgrading its own network path, and it will also use its wholesale expertise to offer mobile backhaul services to other operators, turning the fiber routes into a shared, paid-for utility for every carrier in the state. A finite upgrade program becomes a recurring wholesale business, with the fiber as the hard asset and the wholesale contracts as the yield.

The company extends its fiber reach by converting a portfolio it does not own into routes it can sell on, and it does so where the towers already exist and MICTH has set the digitalization target; MICTH gets an upgraded network, and each side takes its return from the traffic that follows.

Maxis notes that the fiber upgrades at tower sites lay the groundwork for high-speed broadband expansion into surrounding residential and commercial areas, and that is where the real value of a backhaul buildout accumulates: a tower connection is a point solution, but the fiber route is a local network that can be upsold again and again. The 80 percent fiberization target in Melaka is modest; it is also the kind of number that AI traffic curves will keep pushing higher in other states and other countries.

The tower gets the attention and the rent; the backhaul, when it is owned by someone who wholesales it, gets the recurring traffic. The RM30 million is a rounding error in the global AI capex ledger, but the backlog of towers still running on microwave is the real market.