AIS, DTAC discuss joint investment for 3G

Rivals Advanced Info Service (AIS) and Total Access Communication (DTAC) are in talks over a deal jointly to set up a “Tower Company” to invest in telecom-tower infrastructure for their own use in providing a cost-effective third-generation broadband cellular service on the 2.1-gigahertz spectrum.

Meanwhile, a source at the National Broadcasting and Telecommunications Commis-

sion (NBTC) said the watchdog was considering changing the means of making available spectrum slots in the upcoming auction of the 2.1GHz spectrum bands.

“We’re in talks on possible collaboration on the matter [Tower Co] with DTAC,” AIS chief executive officer Wichian Mektrakarn said yesterday. 

While TOT, which owns AIS’s concession, is also keen to set up its own Tower Co to rent its second-generation telecom facilities and network to cellular operators, Wichian said it appeared more technically feasible and cost-effective for AIS to join with DTAC in rolling out the new tower infrastructure to provide 3G-2.1GHz service.

AIS has chosen to discuss the matter with DTAC because the two competitors are able to talk 

to each other easily, he said. 

The companies are, however, yet to hold discussions on the overall expenditure required for the project. 

The average cost of telecom-tower build-up accounts for about 60 per cent of the overall cost of the new mobile-phone network roll-out. Each of the telecom operators is expected to spend between Bt45 billion and Bt50 billion during the first three years on network roll-out.

With the NBTC set to auction the 2.1GHz spectrum in October, potential bidders are now adjusting their organisation and devising business plans to provide 3G service after hopefully winning spectrum bands.

The watchdog yesterday held the hearing on the draft regulations on infrastructure-sharing. 

It expects to have the regula-tions of the 2.1GHz spectrum licensing terms and conditions published in the Royal Gazette next month. 

Under the draft licensing terms, the winners of at least 10 megahertz bandwidth of the spectrum are required to have their 3G networks cover 50 per cent of the population nationwide within two years of acquiring a licence, before rising to 80 per cent within the following two years.

The NBTC source said the watchdog was considering changing the way it will auction spectrum slots in October. 

The first option is to auction three blocks each of 15MHz bandwidth and increase the re-serve price of the spectrum. The second option is to auction five blocks, of which the first three will each comprise 10MHz bandwidth and the other two 5MHz bandwidth apiece. 

The latter option would give a chance to smaller bidders to grab a piece of the spectrum.

In the existing draft licensing terms, the NBTC will auction nine spectrum slots, each containing 5MHz bandwidth, at a reserve price of Bt4.5 billion apiece. 

Each bidder would be allowed to win a maximum of 20MHz bandwidth, which raised concern from some attendees at the NBTC’s first public hearing on the draft last week that this would pave the way for two cash-rich bidders to snatch 20MHz each and dominate the market.

AIS, DTAC and True Corp all said last week that technically, 15MHz bandwidth each would be enough for them to provide quality 3G service.