AIS targets tripling in fibre internet customers

AIS targets tripling in fibre internet customers

"By 2020, we’ll be the major player in fixed broadband,” says AIS CEO Somchai Lertsutiwong. (Bangkok Post file photo)

Advanced Info Service Plc, the top wireless operator, intends to triple subscribers for its fibre-based high-speed Internet service as it grapples with intense competition in the mobile sector.

The Singapore Telecommunications Ltd-affiliated business is targeting 2 million fibre subscribers in three years, up from as many as 600,000 currently, CEO Somchai Lertsutiwong said in an interview.

The goal is to become the preferred platform for digital services in homes and offices as well as on the road, he said.

“AIS has to transform itself,” he said in his office on Wednesday. “By 2020, we’ll be the major player in fixed broadband.”

China Mobile Ltd-backed True Corp has used aggressive handset subsidies to expand its share of the wireless market, overtaking Telenor ASA’s Total Access Communication Plc (DTAC) and hurting industry profitability.

Operators also face a spectrum auction next year with minimum licence prices of more than $1 billion, in a country at risk of a bandwidth shortage as data demand expands.

While AIS has enough spectrum “for a while”, it will definitely bid in the auction and is interested in both the 850 MHz and 1,800 MHz bands, Mr Somchai said.

The firm’s other notable targets include boosting sales to companies to as much as 30% of total revenue from the current 9%. 

Service revenue growth in 2018 is likely to be a little above the pace of economic growth, Mr Somchai said. That implies a range of 4% to 6% if gross domestic product increases in a range between 3% and 4%, he added.

AIS’s revenue would be more diversified if it succeeds in scaling up the number of high-speed subscribers to its fibre network, said Jitra Amornthum, the head of research at Finansia Syrus Securities Plc.

A duel for subscribers and spectrum costs have weighed on the three dominant companies in the wireless sector. 

Operating margin for AIS, 23% owned by SingTel, dropped to about 26% last year, the lowest since 2009, according to data compiled by Bloomberg.

Total Access’s margin slumped to 4.7% in 2016, less than half the previous year. True reported an operating loss for 2016, the fourth annual deficit in five years.


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