4G: 'Winner's curse' fears for Jasmine, True (Updated)
Analysts are wondering if winners Jasmine International and True Corporation engaged in "irrational" bidding, paying world record bandwidth prices which could cause them future losses.
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Sunday morning update
'Winner's curse' fears follow 4G bid
Industry analysts fear "irrational" bidding for the latest round of 4G spectrum licences could cast a winner’s curse on telecom firms set to pay world-record bandwidth prices.
The two big questions mobile industry analysts are debating are how AIS failed to re-secure its 900MHz spectrum, and whether True Move and Jasmine International bid too heavily.
Some industry veterans suggested True Move and Jasmine could end up the big losers from the auction given the prohibitive prices they will have to pay for the spectrum.
The introduction of a new player into the market is also expected to increase price competition in the sector, making it harder for operators to recoup their investment. Fears of a price war forced telecom shares to a three-year low on Friday.
Pipat Luengnaruemitchai, assistant managing director of Phatra Securities, wrote on his Facebook page that the high prices could prove a “winner’s curse”, similar to the digital TV industry where returns have failed to match the high prices paid for broadcast licences.
Kasikorn Securities (KS) viewed the auction result as a “negative surprise”, as it brings newcomer Jasmine International into the market. It expects True Move will have to raise funds after the auction. While likely to steal market share from AIS and Dtac, the company could incur steep losses in 2016-18, KS said.
For Jasmine International, KS said its costly bid reflects an “irrational” decision which could affect overall share prices across the telecom sector.
AIS, which had been expected to use its stronger balance sheets to boost its 4G network, said in a statement yesterday that it withdrew from the auction because the price had stretched beyond fair value.
“AIS put a lot of research into determining the fair value of the spectrum, which included working with a professional consulting firm to run possible scenarios and outcomes from the auction,” said the company, which faced accusations of driving up the bid prices for its competitors.
“The bidding price exceeded the company’s expectations of fair value, so we decided to exit the auction. With the decision to withdraw, AIS can allocate capital to deploy our 4G network quickly to ensure higher network capacity and greater quality.”
Col Settapong Malisuwan, vice-chairman of the National Broadcasting and Telecommunication Commission, said the regulator will hold a meeting tomorrow to formally approve the winners. He hailed Jasmine Internationals entry to the market as “good news”.
Col Settapong said True Move’s successful bid means it now has the highest amount of bandwidth of all the Thai operators. “True Move has the opportunity to overtake Dtac to become the country’s second largest operator over the next few years,” he said.
ICT Minister Uttama Savanayon speaks at the NBTC on Friday afternoon. CHANAT KATANYU
Jasmine, True grab 4G licences
Jasmine International and True Corporation have won the two 10-megahertz 4G licences at the world's record prices of 75.65 billion baht and 76.30 billion baht respectively in a marathon auction that ended early on Saturday.
Jasmine's victory will pave the way for its first foray into mobile internet. The company currently provides landline broadband services under the 3BB brand.
The five-day auction, which ended in the 199th round, will bring in 151.95 billion baht in state revenue, bringing the total from mobile spectrum bids this year to 232.73 billion.
The auctions for the 900-MHz spectrum will go down in world history as being the priciest, breaking the previous record set in Hong Kong.
However, if based on per MHz per head of population, Thailand comes in second after Hong Kong.
Industry analysts said the prized 900-MHz licences could undermine future growth and dent the bidding winners’ income.
Most industry veterans said mobile operators were buying with the future in mind to reap the benefits of lucrative revenue streams stemming from 4G wireless technology.
“Operators are pinning hopes on tapping the country’s increasing digital and mobile internet usage,” one observer said.
NBTC secretary-general Takorn Tantasith said the 900-MHz bidding winners would not be hurt by the world’s record-breaking bids, as operators earn revenue of at least 2 billion baht a month.
ICT Minister Uttama Savanayana said yesterday at NBTC headquarters that auctioning frequency bandwidth could generate substantial revenue for the government.
The money from the auctions may be used for public infrastructure development.
Learn from listening
- accusation: a statement that someone has done something wrong or illegal even though this has not been proved - ข้อกล่าวหา
- allocate (verb): to give out an amount of or share of something - แบ่งส่วน
- analyst: a person whose job involves examining facts or materials in order to give an opinion on them - นักวิเคราะห์
- approve: to give official permission - อนุมัต
- auction: a usually public sale of goods or property, where people make higher and higher bids (= offers of money) for each thing, until the thing is sold to the person who will pay most - การขายโดยการประมูล, การขายทอดตลาด
- balance sheet: the financial report that shows the financial condition and health of a business at a moment in time, shows liabilities and net worth or owner's equity on one side and assets on the other side - งบดุล
- bandwidth (noun): the amount of information that can be sent during a period of time over a network or the internet; the capacity of a communications channel - ความกว้างแถบความถี่, แบนด์วิชท์
- base: to use an idea, a fact, a situation, etc. as the point from which something can be developed - วางรากฐาน
- benefit: an advantage you get from a situation; a helpful or good effect, or something intended to help - ผลประโยชน์, ข้อได้เปรียบ, ผลดี
- bid: an offer to buy or provide something at a specific price - การประมูล, การให้ราคา, การเสนอราคา
- bidding (noun): offering to buy/sell something at a specific price - การยื่นเสนอราคา, การประมูล
- boost: to increase; to strengthen - เพิ่ม; ทำให้มีกำลังมากขึ้น
- brand: a type of product made by a particular company - ตรา, ยี่ห้อ
- broadband (noun): a type of connection to the Internet that allows you to receive or send a lot of information very quickly - ระบบการสื่อสารแถบความถี่กว้าง
- broadcast: to send out a programme on television or radio - กระจายเสียง,กระจายข่าว
- capacity: the amount of something that can be produced or done - ความสามารถในการ (ระบาย, ผลิต etc.)
- capital: a large amount of money that is invested or is used - ทุน, เงินทุน
- cast (verb): to say, do or suggest something that makes people doubt something or think that somebody is less honest, good, etc. - โยน, ให้กำเนิด, หว่าน
- competition: a situation in which people or organizations compete, i.e., try to be more successful or better than somebody else who is trying to do the same as you - การแข่งขัน
- competitor: a person, team or company that is competing against others - ผู้แข่งขัน, คู่แข่ง
- consulting: discussing something with someone in order to get their advice or their permission to do something - ปรึกษา, ปรึกษาหารือ
- costly (adj): expensive; costing a lot of money, especially more than you want to pay - แพง, ราคาสูง
- currently: at this time; now - ในปัจจุบัน
- curse: something that causes harm or evil - ต้นเหตุของความหายนะ
- debate: to discuss something, especially by giving different opinions - อภิปราย, ถกเถียง, โต้เถียง
- decision (noun): a choice or judgement that you make after thinking and talking about what is the best thing to do - การตัดสินใจ
- dent (verb): to hurt; to hurt slightly - ทำให้เสื่อมเสีย, ทำให้เป็นรอยตอก
- deploy: to put in place ready for use - นำมาใช้
- determine: to discover something by examining evidence to or calculate something - กำหนด, ระบุ, แสดงผล
- development: the gradual growth of something so that it becomes more advanced, stronger, etc - การพัฒนา
- ensure: to make certain that something happens or is done - ให้การยืนยัน, รับรอง, ให้ความมั่นใจ
- exceed: to be more than something; to go beyond a limit - เกินกว่าที่กำหนด
- exit: to leave - ออกจาก
- expectations: what is expected - ที่คาดไว้
- firm: a business or company - บริษัท
- foray (noun): an attempt to do something - ความพยายามเข้าไปเกี่ยวข้องกับงานหรืออาชีพที่แตกต่างออกไป
- frequency: the number of times that a wave, especially a sound or radio wave, is produced within a particular period, especially one second - ความถี่
- funds: money needed or available to spend on something - เงินทุน
- future: what will happen to somebody/something at a later time - อนาคต
- generate: to produce - ก่อให้เกิด
- hail: to describe somebody/something as being very good or special, especially in newspapers, etc - ยกย่อง, ชมเชย
- headquarters: the place where an organisation or company has its main offices - สำนักงานใหญ่ กองบัญชาการ
- history (noun): all the events that happened in the past - ประวัติศาสตร์
- income: money that someone gets from working or from investing money - รายได้
- incur: to lose money, owe money, or have to pay money as a result of doing something - ประสบ, ได้รับ
- industry: the people and activities involved in producing a particular thing, or in providing a particular service; the production of goods from raw materials, especially in factories - อุตสาหกรรม
- infrastructure: a set of systems within a place or organisation that affect how well it operates, e.g., the telephone and transport systems in a country or the system of train tracks that a railway uses - สาธารณูปโภค
- investment (noun): the act of investing money in something - การลงทุน
- irrational: done or happening without clear or sensible reasons - ไร้เหตุผล
- landline (noun): a telephone connection that uses wires carried on poles or under the ground, in contrast to a mobile/cell phone - โทรศัพท์พื้นฐาน
- licence: an official document that gives someone permission to do or use something - ใบอนุญาต
- lucrative: earning a lot of money - ที่มีกำไรงาม
- marathon: of something that takes a long time to accomplish - ที่ยาวนาน
- market share (noun): the percentage of sales that a company has in a market or industry compared to total sales - เปอร์เซ็นต์การขายสินค้า, ส่วนแบ่งตลาด
- match: to be the same as or very similar to something else - เท่าเทียมกันกับ, เท่ากันกับ
- mobile (technology): of devices, especially telecommunication devices, that can easily be moved around, e.g., mobile phones, tablets, notebook computers - อุปกรณ์ซึ่งเคลื่อนที่ได้ง่าย
- negative: bad - ที่เป็นด้านลบ
- network: a large system of connected parts, organisations, people, etc. - เครือข่าย
- newcomer (noun): someone who is new to some situation or job or place - คนมาใหม่, สมาชิกใหม่, คนที่เพิ่มมาถึง
- operator (noun): a person or company that runs a business - ผู้ดำเนินกิจการทางธุรกิจ, ผู้ประกอบธุรกิจ
- outcome: a result - ผล
- overall (adj): total; including all the things or people that are involved in a particular situation; general - ทั้งหมด, โดยทั่วไป
- overtake (verb): (past: overtook) to become greater in number, amount or importance than something else - ตามทัน, ไล่ตามทัน
- pave the way: to make something possible or easier to be done - ปูทางไว้สำหรับ
- pin hopes on: to rely on somebody/something completely for success or help - พึ่งพาอาศัย
- population (noun): all the people who live in a particular area, city or country; the total number of people who live there - ประชากร, พลเมือง, จำนวนประชากร
- priciest (adj): most expensive - แพงที่สุด
- prized: very valuable to somebody - มีค่า
- prohibitive: (of a price, cost, etc.) so high that it prevents people from buying something or doing something -
- provide: to give someone/ something that they want or need - จัดหาให้, จัดเตรียมไว้ให้
- public: open to people in general - สาธารณะ
- quality: the standard of something when it is compared to other things like it; how good or bad something is - คุณภาพ
- raise (money): to collect money for something -
- reap: to get something as a result of something that you do - ได้รับผลตอบแทน
- record: the best or most ever achieved - สถิติ
- recoup: to get back an amount of money that you have spent or lost - เอาคืน
- reflect: to show - สะท้อน แสดงถึง
- regulator: an official (or organisation) who makes certain that the companies who operate a system work effectively and fairly - ผู้มีอำนาจควบคุม
- research: a careful study of a subject, especially in order to discover new facts or information about it - การวิจัย
- respectively: in the order in which they were mentioned - ตามลำดับ
- returns (noun): the amount of profit that you get from something; the amount of money you earn - เงินรายได้
- revenue: income from taxes or business activities - รายได้
- round: one of a series of events, activities, etc. - รอบ
- scenario (noun): a description of possible actions or events in the future - การสมมติสภาพที่เป็นไปได้
- secretary-general (noun): the person who is in charge of the department that deals with the running of a large international or political organisation - เลขาธิการ, เลขาธิการใหญ่
- sector: a part of a country’s economic or business activity - ภาค (เศรษฐกิจ)
- secure (verb): to get or achieve something - ได้มา
- spectrum (noun): a range of something, in this case, frequencies available to telecommunications businesses - สเปกตรัม
- state: government - รัฐบาล
- steep (adj): too much; unreasonable - สูงเกินไป
- stemming from: being caused by - เกิดจาก
- substantial: large in size, value or importance - มากมาย, ยิ่งใหญ่, สำคัญ
- tap: to get or make use of something - ใช้เป็นประโยชน์
- telecom: a business in the telecommunications industry - โทรคมนาคม)
- undermine: to make someone become gradually less effective, confident, or successful - บ่อนทำลาย
- usage (noun): how much someone uses a service, measured in minutes, for example - การใช้
- veterans (noun): people who have a lot of experience in a particular area or activity - ผู้อาวุโส
- victory: winning a competition or a battle - ชัยชนะ
- wireless: a system of sending and receiving signals without wires - ไร้สาย
- withdraw: to no longer being involved in something - ถอนตัว
- withdrew (noun): (past of 'withdraw') taken away or taken back, to no longer be involved in something - ถอน, ถอนตัว