SET-listed satellite service provider Thaicom is setting up a subsidiary to participate in the bidding for satellite orbital slot packages slated for July 24, with the offshoot seen as a way to ward off legal complications that may arise.
Thaicom also wrote a letter to the National Broadcasting and Telecommunications Commission (NBTC), asking it to postpone the auction date because of the pandemic. The NBTC responded that a delay is unlikely.
The NBTC allows interested parties to buy a bid envelope from May 21 to June 20.
Air Marshal Thanapant Raicharoen, deputy secretary-general of the NBTC, said the Thaicom letter requested the auction scheduled for July 24 be pushed back. He said the pandemic alone is not a strong enough reason for a delay.
Mu Space and Advanced Technology, a local space tech startup, bought a bid envelope on the first day they became available: May 21.
"I think postponement is impossible," said AM Thanapant.
However, NBTC management will forward this request to its board for acknowledgement, he said.
AM Thanapant said he is aware Thaicom is preparing to set up a subsidiary to join the bid.
"I would guess Thaicom's move is similar to the practice of mobile operators where bids for spectrum licences are placed through their subsidiaries," he said.
Thaicom chief executive Anant Kaewruamgvongs told the Bangkok Post the company plans to pick up the bid document through another firm.
Thaicom still has time to buy a bid envelope, with the board making the final decision, said Mr Anant.
He refused to mention why Thaicom would use another firm to bid, only saying "this would avoid legal complications in the future".
A source at a major mobile operator who requested anonymity said this is a normal practice for companies that run businesses under concession contracts with the state that plan to join a bid to operate a new business under a licensing regime.
"This is similar to models used by mobile operators. Advanced Info Service (AIS), True Corporation and Total Access Communication (DTAC) participated in 3G, 4G and 5G spectrum auctions through their subsidiaries: Advanced Wireless Network (AWN), True Move H Universal Communication (TUC) and DTAC TriNet, respectively," the source said.
The practice, the source said, helps avoid legal complications that can arise as the subsidiary operates a new business through the licensing regime, which differs from the concession model the parent firm uses.
Having a spin-off also helps ward off revenue-sharing complications, the source said. Having two companies makes it clear for accounting purposes and ensures any parent firm dispute with the state on the concession does not affect the subsidiary, the source said.
There are four slot packages up for auction.
The first package consists of 50.5°East and 51°E slots with a reserve price of 677 million baht; the second is 78.5°E with a reserve price of 366.4 million; the third involves 119.5°E and 120°E at 393 million; and the last is for 126°E and 142°E for 364.6 million.
Thaicom now operates Thaicom 4, a broadband satellite, and Thaicom 6, a broadcasting satellite, through concessions.
Thaicom 4 operates in orbital slot 119.5°East while Thaicom 6 is at 78.5°East. Ownership of the two satellites will have to be transferred to the Digital Economy and Society Ministry when the company's concession ends in September this year.
The lifespan of the two satellites extends beyond the concession.
The bid winner for the 119.5°E slot can make use of it only after Thaicom 4's engineering lifespan ends in 2023, said AM Thanapant.