NBTC under increasing pressure to raise 3G auction reserve price

The reserve price of Bt4.5 billion per spectrum slot, which was finalised in June, has been heavier criticised if it is too low when it is clear now that there are only three bidders pitching for nine spectrum slots and each is allowed to grab maximum three slots. The bidders are also believed to willingly pay high to win the spectrum to ensure that they would stay in the cellular business after the concession ends.
Last week activist Suriya Katasila said he and over ten of people network groups want to see the watchdog raising up the price to Bt6.4 billion per slot, which is the full value of the 2.1GHz spectrum slot of 5 MHz bandwidth as evaluated by the NBTC’s working group on the reserve price, comprises a group of lecturers from Chulalongkorn University's economics faculty. Like many parties, he is concerned that to auction the spectrum slot at the present price might make the country gain lesser proceedings than it should have. Suriyasai and the groups have also planned to petition for Central Administrative Court’s injunction today (MON) to suspend the auction on ground that it might breach the law governing the anti bid collusion.
Three cases were already filed at the Central Administrative Court last week, including that of telecom scholar Anupap Tiralap, seeking a court order to suspend the auction. Anupap wants to see the NBTC complete issuance of key measures to bring optimal benefits to the population first before NBTC launching the auction.
The NBTC will call the bid of nine spectrum slots, each containing 5 MHz bandwidth. Each of the three bidders can grab maximum three slots. This had raised criticism of many parties and telecom scholars that this auction terms and conditions would pave way for them to grab three slots each at possible low competition, which if so, the country would have gained less proceeding from the auction than it should have.
The NBTC’s original auction term and condition draft allowed each bidder to grab maximum four spectrum slots to ensure high bid competition amid possible three potential bidders. But after the public hearing on the draft in July, the watchdog changed this maximum number to three slots. This prompted some telecom committee members to propose that the committee should raise up the reserve price from Bt4.5 billion to match with the change to maximum three slots. But the telecom committee finally maintained the Bt4.5 billion price.
Once telecom committee chairman Settapong Malisuwan reasoned that the price of Bt4.5 billion is appropriate. He cited the study of the reserve price working group that the appropriate reserve price should not be lower than 67 per cent of the full spectrum value of 5 MHz bandwidth. Settapong said the reserve price should not be too high, given that soon the watchdog will also have other spectra available for future auctions.
As of last week Settapong was still convinced that the three bidders, Advanced Info Service’s subsidiary Advanced Wireless Network, Total Access Communication’s subsidiary DTAC Network, and True Corp’s subsidiary Real Future, would compete to quote the highest price to be eligible to be the first to select the desired spectrum ranges. The auction features two phases – bid to select the desired spectrum slots and then the highest price offerer will be the first to select the desired spectrum ranges.