Second-ranked mobile operator Total Access Communication (DTAC) has reiterated that it is ready to deal with a potentially explosive challenge to "foreign dominance" before the upcoming 3G licensing auction begins.
KOSOL NAKACHOL
The Norwegian firm, having the state enterprise Telenor as a major shareholder, has vowed a fight to the end to get what it calls a must-have 3G licence to expand business in Thailand.
Mobile leader Advanced Info Service, meanwhile, says the foreign dominance issue will be a crucial risk factor in "another possible collapse" of the 3G auction, initially planned by September.
Allegations have been made from time to time that DTAC and AIS, though still legally Thai-owned, are rightly classified as foreign-controlled firms.
The National Broadcasting and Telecommunications Commission (NBTC) is reviewing the previous regulation governing the Foreign Business Act and is expected to rule within the next three months.
DTAC chief executive Jon Eddy Abdullah urged the state to clarify the regulations for foreign business control.
"We have no worry about the FBA or nominee problem at all," he said. "We're confident that our shareholding structure complied with the law."
DTAC has 18 foreign employees out of a staff of 6,000. Four of the foreigners hold management positions.
Mr Abdullah said DTAC stood ready to comply with new regulations and laws based on any rulings.
The company is prepared to spend 15 billion baht in exchange for a 3G licence.
"No one can afford to lose a 3G licence," the CEO said. "We will pay whatever price to get a licence." But he suggested that an appropriate reserve price would be between 10 billion and 12 billion baht per licence.
"We can survive in the business even with no 3G licence," he said. "But we want to have it, and 3G is now the most influential consumer demand in the country."
Mr Abdullah recommended the NBTC not use the previous planned N-1 approach for the auction, which would require the number of licences available to be equal to the number of bidders minus one.
He said DTAC is in the best position to compete in the 3G auction because of the availability of its 3G network on the 850-megahertz frequency, its 3G-ready transmission technology and its capital.
DTAC also revealed its 3G network swap plans and customer base migration strategy for after its concession expires.
3G services on the international standard 2100-MHz frequency are planned for Bangkok and the major provinces. The existing 3G system on the 850-MHz frequency will be allocated to serve upcountry and rural areas.
Mr Abdullah said the company hoped to enter a wholesale agreement, under the mobile virtual network operator model, with its concession owner CAT Telecom.
A service deal under the cost-base rate structure is needed to continue providing 2G services on the existing 1800-MHz frequency to most customers after the concession expires in 2018.
AIS chief executive Wichian Mektrakarn has said that there will be no major changes to the FBA; he expressed doubt that a 3G auction can happen this year.
AIS is waiting for a clear policy on the memorandum for allocating the 2100-MHz frequency and the recall of existing frequencies. Concessions for AIS subsidiary Digital Phone and for True Move will expire next year.