DTAC, AIS win mobile permits for B25bn

DTAC, AIS win mobile permits for B25bn

The logo of the DTAC Public Company Limited is pictured at its office building in Bangkok on Feb 25, 2016. (Reuters file photo)
The logo of the DTAC Public Company Limited is pictured at its office building in Bangkok on Feb 25, 2016. (Reuters file photo)

Advanced Info Service Plc (AIS), Thailand’s biggest wireless operator, and third-placed Total Access Communication Plc (DTAC) won licences in the country’s spectrum auction for a combined 25 billion baht.

Each firm won a single 1,800 MHz permit for 12.5 billion baht, the National Broadcasting and Telecommunications Commission secretary-general Takorn Tantasith said after the conclusion of the auction on Sunday. The other major operator, True Corp, sat out the sale of the 15-year licenses.

The permit will help Telenor ASA-backed DTAC ensure continuity of service as some of the operator’s concessions expire in September. AIS could use its licence to cement its position as the top carrier in Thailand.

"More spectrum enables Total Access to offer a smooth transition when concessions expire," said Veeravat Virochpoka, an analyst at Finansia Syrus Securities Plc in Bangkok. "Otherwise subscribers may flee to rivals. Advanced Info can market itself as having greater bandwidth."

Thailand offered nine licences in the auction, with the other seven unsold. The regulator is expected to formalise the result after a board meeting.

Sticker Shock

An earlier attempt to sell just three 1,800 MHz permits for a minimum 37.5 billion baht each flopped. All three companies baulked at the costs implied by the previous plan and declined to take part.

DTAC and AIS changed their minds after the number of licences was tripled and the reserve price lowered proportionately.

The acquired spectrum will allow DTAC to maintain second-generation services for a large customer base as well as provide fourth-generation network capacity for "massive growth" in data usage, Chief Executive Officer Lars Norling said in a statement.

There was no bidding war on Sunday, unlike in the auctions in 2015, which led to some of the most expensive airwaves in the world and pressured the finances of carriers.

The telecommunications commission will review bidding conditions for unsold 1,800 MHz and 900 MHz frequencies to make them more attractive for operators, Mr Takorn said. This may include lengthening licence payment periods, as the commission would be criticised if it cut reserve prices, he said.

An auction due Aug 18 for one 900 MHz licence was scrapped after the operators said they wouldn’t take part. The agency is also making preparations to sell airwaves, possibly by 2020, for fifth-generation services.

"If Thailand is late in adopting 5G, the nation will lose a lot in opportunity cost," Mr Takorn said at a briefing.

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