The telecom regulator has scheduled the auction of the 1800-megahertz mobile spectrum used by Total Access Communication (DTAC) for July 2018, two months before the expiry of the concession.
"The auctions are expected to generate at least 135 billion baht in revenue for the state," said Takorn Tantasith, secretary-general of the National Broadcasting and Telecommunications Commission (NBTC).
The concession of the second-largest mobile operator to provide 2G mobile service on 45MHz of bandwidth on the 1800MHz band will expire in September 2018.
"An early auction should take place in order to ensure a smooth transition from concessions to a new licensing regime and maintain service continuity for customers," Mr Takorn said.
In addition, the auction will eliminate conflicts between operators and the regulator over revenue sharing and the period for overseeing remaining customers after the expiry of concessions.
Mr Takorn said the reserve price for the 1800MHz auction would start at 3 billion baht per MHz, or 45 billion baht for 15MHz of bandwidth, and generate at least 135 billion baht in total.
He said the reserve price of the 2018 auction is based on the winning price of the previous 1800MHz licence auctions in 2015 in order to ensure fair competition. The rate is also based on the annual inflation rate.
"The wining prices of the 2018 auction must not be lower than last year's auctions," Mr Takorn said.
Last year, the NBTC auctioned off two licences for the 1800MHz spectrum, each containing 15MHz of bandwidth.
True Move H Universal Communication, a subsidiary of third-ranked True Move, won the first licence for 39.8 million baht, while Advanced Wireless Network, a subsidiary of mobile leader AIS, won the second licence for 40.9 billion baht.
DTAC chief executive Lars Norling called it a good sign that the NBTC plans an early auction by July 2018.
But he said it would only provide a lead time of three months, which is not enough for network installation. In fact, mobile operators require about six months to put a network in place.
In other countries, the law stipulates that a spectrum auction must be held at least 1-2 years before a licence expires.
A telecom industry source said DTAC is the most focused on the 1800MHz auction in 2018.
"If DTAC fails to win a 1800MHz licence again in 2018, the company will have only 15MHz of bandwidth on the 2100MHz spectrum to service its existing 25 million subscribers," the source said.