WhiteSpace, a mobile virtual network operator (MVNO) and owner of the Penguin SIM brand, aims to turn a profit by the first quarter of 2019 and list on the Stock Exchange of Thailand in 2020.
Penguin SIM was officially launched in March 2016 and is now the biggest MVNO in the market with 300,000 active subscribers, replacing Samart I Mobile (SIM), a subsidiary of Samart Corporation that has already exited the mobile market.
An MVNO is a mobile operator that lacks its own cellular network and rents from other networks to provide service.
SIM (now renamed Samart Digital) was the first MVNO in the local mobile market in 2009. SIM subscribers reached as high as 700,000 but later declined amid fierce competition. The company terminated the business in July.
WhiteSpace chief executive Chaiyod Chirabowornkul said the company booked revenue of 100 million baht in its first year of operations.
Mr Chaiyod has pinned hopes on breaking even by the fourth quarter of 2018, reflecting the strategic direction and momentum of the service-based application segment.
"Providing mobile through the MVNO model is not easy, as the three major mobile operators are trying to regain their market share and stabilise earnings," he said.
MVNOs are seen as underdogs because they rely on renting from other mobile networks to provide mobile services, a business for which profit margins are low.
MVNOs lack flexibility and agility because new promotional packages must be approved by the network owner. But Mr Chaiyod said MVNOs still provide needed choices for mobile service in specific segments.
He said the MVNO model is popular in many countries, particularly in South Korea, where MVNOs have captured a 30% share of the mobile market.
In Thailand, where mobile subscriber penetration is already in excess of 130% of the population, there is still room for MVNO business -- especially mobile services for service-based applications in line with the increasing demands of industrial sectors and machine-to-machine connectivity under the Internet of Things.
New target segments will open up and need specific offers, unique services and promotional packages. MVNOs must partner with a variety of vendors to develop services to grab business from these new segments.
"WhiteSpace is expected to be profitable in the first quarter of 2019, and a year later we plan to list on the stock market," Mr Chaiyod said.
The company has 130 employees including executives, a drop in the bucket compared with personnel at the big telecom operators.
WhiteSpace services are operated via an organisational structure in five divisions: marketing, branding, sales, IT and human resources. Penguin SIM outsources call services for customers.
Penguin SIM has no plans to provide postpaid mobile service, as the model requires much more complicated management and higher operating costs for billing and collecting unpaid fees.
"We generate a slight margin from our service, but have low costs in our regular operations," Mr Chaiyod said.
Penguin SIM operates mobile services on CAT's 850MHz network. The company will sign an agreement with TOT in November to rent the state enterprise's 2100Mhz network, with plans to offer roaming on CAT's 850MHz network by early next year.