TOT executive panel pushes for strategic talks with AIS

 

TOT’s executive committee has ordered the state agency to enter into negotiations with Advanced Info Service (AIS) for a possible strategic partnership of the state agency’s mobile phone service business unit.

A TOT executive source said the executive committee ordered the state agency’s management to present the results of the negotiations for the board to consider this Wednesday.

The executive committee picked up AIS’s business proposal to be its mobile phone service partner as it is considered to be the best partnership model and it is estimated to have the highest revenue yield to TOT among the five telecom operators that have submitted partnership proposals.

The other four companies that have submitted partnership proposals to TOT are True Corp, which is considered the second best proposal, Loxley, the third best, Mobile LTE, the fourth best, and Samart Corp. The state agency has hired Deloittee as advisor in considering all of the proposals.

AIS is TOT’s concession holder and its concession will expire on September 30.

According to the AIS proposal, it will set up a joint venture with TOT’s mobile phone service business. The proposal includes a plan to expand TOT’s 3G wireless broadband network and the network roaming between TOT and AIS.

“The AIS proposal is the best from a long-term investment aspect as it will help the state agency make a profit in the first year of the partnership,” the executive source said.

This year, TOT is forecasted to suffer an operating loss of Bt10 billion, compared with a profit of Bt1 billion last year.

AIS has also offered to join with TOT to operate all of the state agency’s spectra but the executive committee believes it should focus on TOT’s 3G-2.1GHz only.

Both TOT and AIS have held 15MHz of the 2.1GHz spectrum bands, which are adjacent to each other. TOT is the first operator in Thailand to operate 3G services on 2.1GHz since 2009 but it only managed to secure 600,000 users.

AIS launched its 3G services on 2.1GHZ in 2013. As of the second quarter, AIS had a total of 40.1 million subscribers, most of whom were 3G subscribers and the rest 2G users.

Meanwhile, the executive committee also ordered TOT’s management to talk with AIS to seek ways to settle a legal dispute about the ownership of telecommunications towers under its concession. The state agency wants to end the dispute before the AIS concession ends. The dispute involves 13,198 telecom towers.

To solve the telecom tower dispute with AIS, TOT has three options: allow AIS to rent the towers; set up a joint venture with AIS to manage the towers; and establish the infrastructure fund to put the towers up for leasing.