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Don Sambandaraksa

Dtac to feel good again with the return of Sigve Brekke

Dtac has replaced its CEO with Telenor EVP and head of Telenor Asia Sigve Brekke returning to the post he held between 2005 to 2008 until a permanent replacement for Jon Eddy Abdullah can be found.

Dtac’s announcement came out of the blue and took the industry by surprise.

The chairman of Dtac, Boonchai Bencharongkul, has started the process of appointing a new CEO.

“Mr. Brekke has been asked to serve as the interim CEO of Dtac until a new CEO has been identified. He has significant experience with Dtac, currently acting on the board of directors as vice chairman and previously heading up the company as CEO from 2005 to 2008,” said Boonchai.

A Dtac spokesperson said only that Abdullah had been a lovely boss and that the resignation was for personal reasons.

This change at the helm of Thailand’s number two mobile operator comes at a critical juncture. Politically Dtac has fallen foul of the ruling military junta by exposing a secret block order to cut off Facebook access and the continued rumblings aimed at its foreign executives over the protectionist Foreign Dominance Notification are too often an unwelcome distraction.

More importantly, the entire industry is in turmoil with 900-MHz, 1800-MHz and potentially 2.3-GHz and 2.5-GHz bands coming available soon in one form or another.

It is looking increasingly unlikely that it will be through an open auction given the emphasis by the regulator, the junta and the new ICT Minister to save state telcos CAT and TOT by changing laws to allow for sub-letting of spectrum and to remove a requirement for competitive auction in spectrum allocation. It would not be surprising if part of the spectrum will be sub-let by the state telcos.

Dtac needs someone with the personal connections, the knowledge of how the state telcos think and behave and someone to open doors if it is to secure a slice of spectrum going forward. Who better than Sigve Brekke?

During his tenure as Dtac co-CEO, Brekke had built up something of a personality cult. He starred personally Dtac’s TV ads. He was accessible to the media and to people, personally touring markets and streets with his staff to ask people and resellers first hand why they used one network over another. People would rush out to see him or even hug him.

No, he was not quite a Steve Jobs, but he was the closest thing Thailand ever had to one.

This was a time when voice was booming, when pre-paid was an innovation and when mobile penetration was doubling year after year

It was a time when the incumbent telco owned by the Prime Minister’s wife, children, cook and driver was the recipient of thinly veiled favouritism.

Most infamous was a decision by the Telephone Organisation of Thailand to introduce a numbering charge of $6 (200 baht) a month, but only to other companies and not itself or its concessionaire. Given that the typical monthly package was 299 baht, this meant that Dtac was taking home just one third of its competitor and yet it not only survived, but thrived through sheer goodwill and a feel good factor.

The response in social media has been overwhelmingly positive.

“Familiarity is the inhibitor of innovation” - Sigve. Feeling Wonderful, tweeted @roommini quoting one of Brekke’s many quotes that still echo around Thai management circles.

“Given a series of @dtac PR disasters, I think @Sigve_telenor is one of a few people that can bring back the confidence,” said @rehabbedO.

Best of luck to you @Sigve_telenor as interim CEO at @dtac . Not that you need the luck part really;-) #thisshouldbegood, chirped @IP_Thailand_IP.

For his part @Sigve_telenor only tweeted a picture of himself addressing the staff at Dtac house.

Of course, Abdullah was an efficient CEO. After all, he secured Dtac’s first real 3G licence after years in the wilderness and managed to make the telco the market leader in terms of post-paid subscriber ratio, both no small feats.

But Abdullah too often found himself on the defensive and somehow lacked the charm and seat-of-the-pants style that had characterized Brekke’s tenure.

Dtac suffered a massive network outage in 2012 after sheer bad luck saw a fire take out one cable and a car accident take out another within minutes of each other. The regulator come down on him very hard. Chance had it he was out of the country on holiday when it happened. A botched HLR migration caused another outage.

Then there was the 3G roll-out problems. Originally to be an Ericsson-only deal, Huawei had to be bought in part way through the rollout to speed things up.

Dtac also was unable to negotiate right-of-way as efficiently as the other telcos slowing down city-centre roll out, though that perhaps is to his credit that he did not buckle to the Thai way of doing things. Today Dtac is in third place in terms of 3G roll-out.

Now the industry has to wait and see what Sigve Brekke first move as CEO will be. Whatever it is, it will be aggressive and it will be on the front pages of all newspapers, just the way he likes it.