CAT decides to withdraw from 4G bids
State agency fails to get foreign partners
State enterprise CAT Telecom has finally decided to pull out of November's fourth-generation (4G) spectrum auctions, dealing another blow to the government's efforts to attract bidders from new entrants and foreign companies to generate more competition.
The withdrawal also signals consolidation of the stranglehold by the big-three mobile operators -- Advanced Info Service, Total Access Communications (DTAC) and True Move.
CAT will not participate in the auctions for the 1800- and 900-megahertz spectra for 4G networks after not being able to reach partnership deals with foreign firms.
It was also deterred by having to declare its budget and receive cabinet approval before the auctions took place.
"This is impractical, as other bidders would know our maximum bid. It's barring us from competing in an auction," acting president Col Sanpachai Huvanandana said.
Even though CAT has strong financial health with an accumulated profit of more than 30 billion baht plus annual interest of 1.5 billion, the state agency is not ready to compete in a bidding war.
Col Sanpachai said CAT had prepared to join the 4G auctions since 2013. It was in negotiations with foreign telecoms NTT Docomo of Japan and SK Telecom of South Korea.
CAT and the Korean wireless telecom operator had talked about the possibility of setting up a joint venture to provide 4G wireless broadband services. SK Telecom had initially agreed to bid in the 4G auctions with CAT, Col Sanpachai said.
"With the degree of uncertainty regarding the auction delay and the unclear auction design, negotiations between the parties collapsed," he said.
Col Sanpachai said CAT had seen MCOT Plc's struggle to operate a digital TV business successfully after winning a bid. He cited impractical requirements as the main reason.
CAT provides 3G mobile service on the 850-MHz spectrum under the My brand.
The state enterprise also holds wholesale-resale mobile contracts with True Corporation subsidiaries Real Move and Real Future to provide 3G service on 15 MHz of bandwidth of the 850-MHz spectrum.
Col Sanpachai said CAT recently submitted its proposals to Information and Communication Technology Minister Uttama Savanayana, urging him to encourage CAT to keep a 20-MHz portion on the 1800-MHz spectrum after the expiry of its concession.
The state enterprise wants the bandwidth to provide its own 4G service. It has the right to continue using the 1800-MHz spectrum until 2025 even though its concession with DTAC will expire in 2018.
CAT has also submitted its proposals to Deputy Prime Minister Wissanu Krea-ngam for consideration.
DTAC holds 50 MHz of bandwidth on the 1800-MHz spectrum. The company uses only 25 MHz and has already returned 5 MHz of the mobile spectrum to the National Broadcasting and Telecommunications Commission for auction in November.