CAT chews over solutions to dispute

CAT chews over solutions to dispute

Concessionaires could pool resources in fund

CAT Telecom will decide next year whether it will unconditionally end its bitter decade-long dispute over network transfers with its concessionaires.

The end of the dispute would open the door to mutual business opportunities and partnerships between parties.

It would also produce new revenue streams and allow the state enterprise to reposition itself as a telecom network service provider instead of merely a telecom operator, said Col Sanpachai Huvanandana, acting president of CAT Telecom.

The state telecom enterprise is still locked in arbitration with its two concessionaires, Total Access Communication (DTAC) and True Move, with combined damage claims worth over 10 billion baht.

The ownership of network assets is a critical legal dispute.

CAT's past management team wanted DTAC and True Move to return their mobile infrastructure assets to CAT, as the two private companies operate second-generation (2G) service under a build-transfer-operate concession.

CAT asked DTAC and True Move to transfer a respective 13,000 and 8,000 mobile base stations. So far they have returned a combined 1,000, claiming they are not required by the concessions to transfer any assets to CAT.

"We have outlined three or four scenarios for resolving all disputes, with a conclusion expected by year-end," Col Sanpachai said.

A potential option, he said, is setting up a telecom infrastructure fund by pooling the two operators' network assets so they can be rented out.

Col Sanpachai said ending all existing disputes would ensure the two mobile operators' confidence in business continuity, as they could use telecom infrastructure even after their concessions expire.

DTAC will today enter into a network-sharing agreement with CAT, and True Move will likely follow suit soon, Col Sanpachai said.

CAT expects revenue of 52 billion baht in 2015, up 8.4% from this year.

Of the total, 26 billion would come from wireless business, 7.5 billion from broadband internet, 3.3 billion from international direct dialling, 850 million from IT and cloud computing, and 12 billion from concession-related revenue.

CAT's mobile business is expected to generate 1 billion baht this year, while its business under the mobile virtual network operator (MVNO) model is seen contributing 24 billion.

"We expect to have up to 1 million mobile subscribers next year," Col Sanpachai said.

CAT expects to allow four more companies to provide MVNO service on behalf of CAT over the next six months.

The state enterprise intends to invest 10 billion baht in business expansion next year.

Plans also call for rebranding CAT's broadband internet service, with the aim of expanding the customer base into small and medium-sized enterprises in addition to individual users.

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