Monday, March 30, 2020

Auctions of telecom licences expected to have huge impact

Nov 08. 2015
Facebook Twitter

By Usanee Mongkolporn,

Sirivis

The planned auctions of telecom licences on the 1,800- and 900-megahertz spectra, if they can take place, could shift the competitive landscape, spark massive investment, and bring new wireless services and applications to the market, according to telecom

 

The National Broadcasting and Telecommunications Commission (NBTC) will auction two 1,800MHz licences on Wednesday and two 900MHz licences on December 15. The combined cost of conducting the two auctions is Bt110 million.

The bidders for both spectra are the same four companies: Advanced Wireless Network of Advanced Info Service (AIS), DTAC TriNet of Total Access Communication, True Move H Universal Communication of True Corp, and Jas Mobile Broadband of Jasmine International.

The NBTC believes that the competition among the bidders in the auctions will be fierce. Telecom industrialists are hopeful that the auctions will be held as scheduled, despite legal action against them.

TOT’s labour union last week threatened to seek a court injunction against the 900MHz auction this week, after submitting a lawsuit, also last week, with the Central Administrative Court against the NBTC and related persons to defend TOT’s right to continue using this spectrum until 2025.

In 2013, CAT Telecom filed a similar suit with the Central Administrative Court against the NBTC’s plan to auction the 1,800MHz bands. It also asked the court to rule on whether its right to the spectrum would end in 2025 when its telecom licence expires or ended in September 2013 when its 1,800MHz concessions granted to TrueMove and Digital Phone Co expired.

A change of landscape

According to a telecom analyst, the auctions of both spectra could shift the competitive landscape. If AIS can win a licence on one or both spectra, this will solve its bandwidth constraint risk and allow it to continue to grow its data revenue. Such a win would also reduce True Corp’s spectrum advantage and slow down its gain of market share.

While all four bidders have announced they will seek licences on both spectra, the analyst expects AIS to win one licence on each spectrum, DTAC to win one on 900MHz, and True one licence on 1,800MHz.

Economic impact

According to an NBTC-commissioned study on the economic impact of the auctions by Chiang Mai University’s economics faculty, the auctions are estimated to bring in around Bt73 billion for the state. Of that total, more than Bt40 billion is expected to be from the 1,800MHz licences.

The auctions will spark investment of around Bt150 billion on related infrastructure over the next two years and generate added value to related sectors to the tune of Bt1.3 trillion over five years.

The licence winners aim to use 1,800MHz to offer fourth-generation service on Long-Term Evolution (LTE) wireless broadband technology. Most of the 4G-capable devices in Thailand feature dual modes (4G-1,800MHz/3G-900MHz) or triple modes (4G-1,800MHz/2.1GHz/900MHz).

True and DTAC have already launched 4G-LTE services. The former launched the service on the 2.1-gigahertz spectrum and the latter on both 2.1GHz and 1,800MHz.

Camilla Vautier, president of Ericsson Thailand, said recently that the deployment of 4G would provide operators more efficient networks that could deliver high-quality services as data traffic and device ownership continue to grow.

"Access to more radio spectrum with advanced network capabilities like 4G-LTE will help Thai consumers, companies, industries and the country to meet this growth and to realise the true benefits of a digital economy," she said.

"Continued evolution of mobile networks will drive the growth of the networked society in Thailand. In the networked society, we are seeing the beginning of this continued development already. Not only people and places will be connected, but also things.

Anything that benefits from being connected will be, in real time. It’s about new ways for us to collaborate, share and get informed," she said.

A joint study on the socio-economic effects of broadband speed on the economy conducted by Ericsson, US consultancy Arthur D Little and Sweden’s Chalmers University of Technology confirms that doubling broadband speeds can add 0.3 percentage point to growth of gross domestic product. Broadband has the power to spur economic growth by creating efficiency for society, businesses and consumers. According to recent "Ericsson Mobility Report", 4G-LTE subscriptions have now reached 600 million globally and will exceed 1 billion in 2016. By 2020 LTE subscriptions will have reached 3.7 billion.

Vautier said that compared with other ICT-developed markets like Singapore and Australia in this region, Thai operators still had relatively few spectrum bands. As mobile data traffic will grow by nine times in six years, the NBTC should have a clear spectrum-release schedule so operators and industry can plan their business.

According to Harald Preiss, Southeast Asia head of Nokia Networks, his company, being an industry leader in 4G, is well positioned to help operators provide best-in-class networks and services.

"With the support of the Thai government, we should see an extremely vibrant environment for infrastructure-development projects across the country. Nokia Networks is committed to being part of this development and helping Thailand reach its goals for a digital economy," he said.

By using innovations such as Mobile Edge Computing, location-based services can be used to enhance the customer experience. All the applications and processing are hosted at the base station, which will allow quicker access and also a more dynamic, interactive experience, he said.

"In the longer term, we will see the rapid deployment and growth of machine-to-machine and Internet of Things, which means we will soon live in a world with between 10 and 100 times more Internet-connected devices than there are connected humans, which will enhance every facet of people’s lives.

"This is already happening – today we are seeing countries such as Australia, Korea and New Zealand starting to push out public safety over LTE. This could be an area of focus for Thailand in the future," Preiss said.

Tags:
4G
Facebook Twitter
More in Business
Editor’s Picks
wmg-logo
Top News
wmg-logo