National Telecom urged to focus on infrastructure
The chief executive of a major mobile operator who requested anonymity says the newly formed National Telecom (NT) should focus on telecom infrastructure-sharing and serving the government's public-concentrated Universal Service Obligation (USO) projects, rather than joining the contentious telecom service battle.
NT, which is a merged unit of state telecom enterprises TOT and CAT Telecom, was launched on Jan 7.
Digital Economy and Society (DES) Minister Buddhipongse Punnakanta said NT aims to be among the top three mobile operators in Thailand by the end of this year.
The chief executive said NT's goal of the top three is impossible because its management and operational fundamentals were not designed for competition in the commercial market.
He said NT is involved in the state procurement process and has a bureaucratic system, which is not meant for commercial competition, particularly in the highly contentious telecom and digital markets.
"Although management personnel are smart, they lack experience in commercial services," said the source.
Despite having provided mobile services for more than a decade, both TOT and CAT Telecom only have a combined 2.6 million subscribers, he said.
"Mobile business requires precise decisions and quick implementation to deal with this red ocean competitive market," the chief executive said.
According to him, TOT and CAT Telecom have relied on revenue-sharing business through concessions for decades.
NT's structure also deals with state-run operations in terms of investment approval, operational decision making as well as marketing strategies, which is not in line with market competition, he said.
By March, mobile services operated by TOT and CAT Telecom are slated to be merged into NT Mobile, with packages rolled out by that time. NT Mobile also has a plan to roll out SIM packages for data usage with affordable prices.
"This is seen as an old practice in the new digital world," the chief executive said, adding digital service business needs new revenue streams rather than plain package tariffs.
He said NT should focus on two businesses.
The first is telecom infrastructure-sharing where private operators are allowed to rent NT's assets for telecom services. NT enjoys rental fees while private operators reduce their investment cost.
The other is to operate USO projects allocated by the National Broadcasting and Telecommunications Commission (NBTC), bypassing the bidding process.
USO projects support construction of a fibre-optic network, WiFi hotspots and mobile access nodes for villages.
The projects are meant to bridge the digital divide in remote areas.
"The NBTC should award USO projects to NT through a cost-plus contract," he said.
USO projects are estimated to contribute at least 10 billion baht in revenue per year.
NT is also in talks with two top mobile operators -- Advanced Info Service and True Move H Universal Communication -- for agreements on infrastructure-sharing on its 700-megahertz spectrum network, as well as roaming agreements to make use of the 2600MHz range occupied by the two major operators.
The chief executive said such cooperation is needed as CAT's cash flow fell from 50 billion baht to 20 billion after it won the 700MHz spectrum licence at the 5G auction in February last year. The remaining money is insufficient to invest in network roll-out.