All three major mobile operators are expected to compete in the 5G spectrum auctions scheduled for February, particularly for the 2600MHz and 26GHz ranges, to become leading players in the ultra-high-speed wireless technology, says an analyst.
The National Broadcasting and Telecommunications Commission (NBTC) on Wednesday said the 700MHz, 1800MHz, 2600MHz and 26GHz ranges would have 5G spectrum auctions held on Feb 16. The reserve prices for the four spectrum ranges total 157 billion baht.
Pisut Ngamvijitwong, a senior analyst at Kasikorn Securities (KS), said the 2600MHz and 26GHz ranges, with reserve prices of 8.7 billion and 12.4 billion baht per licence, respectively, are likely the lowest figures the telecom regulator could offer. Some 19 licences will be available for the 2600MHz range and 27 licences for the 26GHz range.
Leading mobile operator Advanced Info Service (AIS) is expected to bid for seven licences on the 2600MHz range, totalling 70MHz of bandwidth.
Total Access Communication (DTAC) and True Move H Universal Communication (TUC) each are likely to bid for six licences or 60MHz of bandwidth.
Regarding the 26GHz range, AIS is likely to bid for six licences on the range, or 600MHz of bandwidth, while the other two would bid for five licences or 500MHz of bandwidth each.
Mr Pisut said the low spectrum reserve prices would be a boon for the industry.
The three operators also need to reserve their coffers for future auctions on the 3500MHz spectrum -- the range mostly used globally for 5G technology. The range is held by Thaicom, whose concession for the spectrum ends in 2021.
Mr Pisut said the 5G licence cost should be low to promote 5G adoption and development of use cases.
"The three major operators have no choice but to race for the 5G licences to stay competitive in the market, though there are still no business use cases," he said. "Consumers expect a 5G symbol in the right corner of their phone screen."
According to KS research, the reserve prices for 2600MHz and 26GHz are 22% and 86% cheaper than its forecasts of 237 million baht per MHz on the 2600MHz range and 22 million baht per MHz for 26GHz, respectively.
KS expects the final bids for 5G spectrum to match the reserve prices.
Mr Pisut said the flexible spectrum payment terms offered by the NBTC could help mobile operators ease their financial burden, and it would be unlikely to affect their cash flow or dividend payments.
NBTC secretary-general Takorn Tantasith said he's convinced that the three major operators will bid for both 2600MHz and 26GHz licences as they seek to become the first 5G mover.
"The cheap reserve prices, as well as flexible terms of payment, are intended to ease the financial burden of the operators in line with the government's policy to promote 5G use case development in 2020," Mr Takorn said.
AIS chief executive Somchai Lertsutiwong said the Feb 16 auction is not a problem, but he wants to see additional conditions that can facilitate 5G adoption.
The government, he said, should allow spectrum bidding winners to convert part of the licence cost into their 5G infrastructure investment in the Eastern Economic Corridor.