Doubt grows over future of 1800 in Thailand

21 Nov 2012

While the 3G licensing situation in Thailand remains unresolved, there has been considerable movement on the 4G LTE front. With it has been a lot of media frenzy about how Laos now has 4G while Thailand cannot even get its 3G act together.

Earlier, TOT announced that it would be partnering with Japan’s Softbank to launch LTE on the 64 MHz it has on the 2.3-GHz band. Details are sketchy here, with TOT saying it would have to apply for a new licence, but at least there is little controversy over ownership of the band.

Back in November 2011, the regulator passed notification that telecoms, broadcasting and radio spectrum would be re-allocated in 15, 10 and 5 years, respectively. This means that TOT would have 15 years on 2.3-GHz, among other spectra.

Meanwhile, TrueMove has been busy demonstrating LTE on 1800-MHz with cooperation with state-owned CAT Telecom. After a series of high-profile demonstrations in Bangkok, the telco yesterday announced a successful test run in a remote area and successfully demonstrated 3G/4G handoff.

A lot of fuss was made on the speeds achieved, but of course going onto an empty network is hardly representative.

There will soon be a lot of controversy over the 1800-MHz band once the issue of 2100 is passed one way or the other - and whatever comes out of 1800 next year will have repercussions for 900 when AIS’ concession ends in 2015.

There are two concessions on 1800 that are about to expire in September 2013, 12.5 MHz with TrueMove and 12.5 MHz with DPC, an AIS subsidiary. The point is that the telecom regulator and the frequency allocation act 2010 says that expiring spectrum is to be returned to the regulator for re-allocation. Earlier, the NBTC mulled a March 2013 auction

However, another group of players, most notably concession holder, state telco CAT Telecom and the ICT Ministry which oversees it, wants the spectrum returned to CAT.

ICT Minister Anudith Nakonthap’s argument seems to revolve around the argument that the handover of 2G equipment from concessionaires to CAT Telecom without spectrum simply does not make sense and that CAT needs the spectrum in order to be given a chance to survive. He also argues that the concession contracts point to a return of spectrum to CAT.

The question is whether CAT Telecom is one and the same with the Communications Authority of Thailand, and if those rights - those state domain assets - were transferred to CAT Telecom or returned to the state (or to the finance ministry).

Some go a step further and question why we even need a state telco middleman at all and if direct licensing of 1800 MHz to private sector operators would be more efficient.

Of course, those concessions were drawn up when CAT Telecom was still the Communications Authority of Thailand and had its own parliamentary act behind it, before the idea of an independent regulator.

What is worrying is that the ICT Minister has asked the council of state (a fancy name for the government lawyer) to rule on the two interpretations.

Here, I need to go out on a limb. In too many cases, the council of state has issued rather dubious, politically-pleasing decisions, decisions that fall apart when put to a court of law, but which protect the cabinet from lawsuits, as they can say they were only following advice.

So in a way, this could be paving the way for one of those controversial cabinet resolutions bequeathing 1800 to CAT. Maybe. Maybe not.

At worst, this would leave 1800 MHz in a legal mess that would make the current 2.1 GHz omnishambles look like a pleasant, sunny day in the park.

At best, it would suddenly leave CAT Telecom with 25 MHz or even 50 MHz that should have been reallocated to private sector entities which could more efficiently use it.

Then there is the issue of another 25 MHz that CAT has seized back from Dtac. The Telenor outpost used to have 50 MHz on 1800 but was told to return half of it unless they could demonstrate technical need, an example of how subjective the concession agreement is beyond just the headline 30% revenue share.

Dtac CEO Jon Eddy Abdullah has said that the regulator has the legal power to seize unused spectrum and simply re-auction it, which Dtac wants to happen. This would allow 1800 LTE under more favourable terms than the current crippling 30% revenue share BTO concession. It is 25 MHz that is allocated to Dtac under the concession so cannot be used by anyone else either, so is stuck in limbo.

Having 50 MHz of prime LTE spectrum lying unused is a shame. That said, the same could be said of 2.1 GHz, which saw a week pass with final testimony being delivered to the courts by the three telcos on 20th November and no verdict or injunction so far.

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