NBTC mulls capping of spectrum

NBTC mulls capping of spectrum

Move to spur rivalry would hit DTAC hard

Takorn: Aim to open market to newcomers
Takorn: Aim to open market to newcomers

The national telecom regulator plans to cap the maximum spectrum each operator may have at 60 megahertz, including for the fourth-generation (4G) frequencies to be auctioned this year.

The move is aimed at opening the local mobile market to new entrants to promote competition, preventing a single operator from holding excess spectrum assets.

If applied, the spectrum cap rule is expected to hit Total Access Communication (DTAC) hardest, as the country's second-largest mobile operator has the largest amount of bandwidth with 75 MHz on various frequencies.

"A cap is needed to strike a balance between increasing existing coverage in markets dominated by strong incumbents and opening those same markets for new entrants to increase competition," said Takorn Tantasith, secretary-general of the National Broadcasting and Telecommunications Commission (NBTC).

Sigve Brekke, head of Telenor Group's Asia operations, said the spectrum cap should apply to only licence-based spectrum, not frequencies under concession regimes.

DTAC holds 50 MHz of bandwidth on the 1800-MHz spectrum, 25 Mhz of which are unused. Its concession with CAT Telecom is due to expire in 2018.

The company also holds 15 MHz on the 2100-MHz spectrum under the NBTC's licensing regime, plus another 10 MHz of bandwidth on the 850-MHz spectrum under another contract with the state-owned enterprise.

"The cap cannot apply to all types of frequencies. Our existing 60 MHz of bandwidth is under a concession contract, and CAT is the spectrum owner, not DTAC," said Mr Brekke, who will become Telenor's president and chief executive on Aug 17.

Mr Takorn insisted the spectrum cap would only apply to telecom frequencies in the first stage, including those either under concessions or the licence system.

He said the NBTC plans to add the spectrum cap details to its draft auction designs for 4G spectrum auctions, scheduled to take place in November and December. Details of the spectrum cap would be proposed for consideration to the NBTC's telecom committee at a meeting on Wednesday.

Mr Takorn said a single telecom operator with over 60 MHz bandwidth could still participate in the 4G auctions, but a winning bidder must return any excess amount of old bandwidth if its overall spectrum hold exceeds 60 MHz.

Col Settapong Malisuwan, chairman of NBTC's telecom committee, supports the spectrum cap rule for this year's 4G auctions.

The cap would cover telecom frequencies including 470-, 800-, 900-, 1800-, 1900-, 2100-, 2300- and 2600-MHz.

Col Settapong said the spectrum cap is widely applied by many regulators globally, especially in Europe, where it is capped at 90 MHz bandwidth.

Mr Takorn said DTAC failed to commit to the NBTC's proposal that the company return its unused bandwidth of 5 MHz on the 1800-MHz spectrum for 4G auctions without conditions or compensation.

The unused block would increase the total bandwidth to be auctioned off to 30 MHz, which can be split into two slots of 15 MHz to maximise use of the frequency.

In exchange for returning the bandwidth, Mr Takorn said DTAC wanted the regulator to split the 30 MHz of band- width into three slots for auction, containing 10 MHz each on the 1800-MHz spectrum.

The NBTC initially plans to allocate four licences for the 4G spectrum auctions including two comprising 12.5 MHz of bandwidth each on the 1800-MHz spectrum and another two licences of 10 MHz each on the 900-MHz spectrum.

The auction for the 1800-MHz spectrum will take place in November, while the 900-MHz auction is scheduled for December.

"A change in the amount of spectrum for auctions will cause 4G auctions to be delayed further," said Mr Takorn.

"DTAC's request is unacceptable. It also shows the insincerity of the company," he said.

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