Two major telecom operators are racing to buy National Telecom's (NT) mobile phone and retail fixed broadband internet subscriber bases.
NT president Colonel Sanphachai Havanandana said NT is seeking a private partnership to help solve its combined operational losses from the mobile phone service and fixed broadband internet service of several billion baht per year, due to high operating costs and fierce competition.
"The partnership must be based on a fair basis," he noted.
Col Sanphachai told the Bangkok Post that NT's management and Advanced Info Service (AIS) have been in talks over this new partnership for a year.
AIS recently proposed such a partnership with preliminary details to NT's management, noting that it wants to help NT restructure businesses to achieve sustainability and solve its revenue structure problem.
Col Sanphachai said that AIS's arch rival, True Corporation, is expected to submit a similar proposal to NT soon.
UNLIKELY TO MATERIALISE
Col Sanphachai said the AIS proposed partnership is unlikely to materialise, given that it is a complicated issue.
One issue is if NT sells all its fixed broadband internet subscribers to AIS, NT staff who operate this business will have no tasks to carry out and become redundant.
AIS's proposal is a preliminary one that requires a study and discussions for a period of at least for one year before reaching a final conclusion, Col Sanphachai added.
He said NT has around 11,000 employees, 6,000 of whom work in the fixed broadband division, while 400 are employed in the mobile phone service business.
NT's mobile phone service has 1.4 million active users, of which 800,000 are on the 700MHz network.
ISSUE OVER COMPETITION SEEN
AIS's proposal lacks several key details, particularly how to handle 6,000 employees under NT's fixed broadband internet unit once the customers transfer to AIS.
The proposal does not mention how to deal with NT's 700MHz mobile licence fee that NT paid to the National Broadcasting and Telecommunications Commission (NBTC) at a rate of 1.65 billion baht per year.
Moreover, NT will have to get the greenlight from the NBTC first before it can transfer customers to AIS, Col Sanphachai added.
He said NT earlier consulted with the NBTC's management about the possibility of its gradual withdrawal from mobile and broadband businesses.
The regulator opposed the idea over concern that NT's exit from the two businesses might affect the competition structure of both markets.
CUSTOMER ACQUISITION
According to the AIS proposal, it intends to buy all NT mobile phone customers and retail broadband internet customers.
Moreover, it proposed to lease and manage NT's broadband internet network to ensure the broadband internet service will not be disrupted after its acquisition of all NT customers.
The move would help NT cut operating costs and NT could still keep its network ownership as well as prevent a possible operating loss, according to the AIS proposal.
AIS will make the official proposal to NT after due diligence and discussions with NT, says the AIS proposal.
An NT management source who requested anonymity said NT should return its part of the 700MHz spectrum to the NBTC to cut potential operating expenses.
The state enterprise clinched 20MHz of bandwidth on the 700MHz band at an auction in 2020.
In 2023, NT transferred the right to use 10MHz of bandwidth on the spectrum to Advanced Wireless Network Co Ltd (AWN), a subsidiary of AIS.
While NT has built new businesses, it will take time for them to offset the revenue from its expiring 850 MHz, 2100MHz and 2300 MHz mobile services, the source said.
NT mobile phone services on these three bands generate a profit of 10.1 billion baht annually. The bands expire in August.
A veteran telecom industry executive who requested anonymity added that AIS wants to acquire NT's mobile phone service and broadband internet customers in order to increase its overall customer number and position itself as the real No.1 player in all aspects.
He said the Digital Economy and Society Ministry had urged the private operators to make partnership proposals to NT in order to help NT survive after its three spectrum bands expire in August.