Thai regulator, govt clash over 1800-MHz

07 Mar 2013

The fate of TrueMove’s 18 million 2G subscribers continues to be in limbo, with time running out. Concession holder CAT Telecom has said it expects only 8 million subscribers to port out in time for the expiry of its concession, and up to 10 million subscribers may find their phones dead on 15 September.

The regulator is adamant that the 25 MHz of 1800-MHz spectrum involved (12.5 MHz of TrueMove, 12.5 MHz of DPC, an AIS subsidiary) is returned for re-allocation. However, CAT Telecom seems to think that it can hold on to the spectrum for 4G LTE and has offered to return half as a compromise.

In my humble opinion, CAT is on shaky legal ground. It has cited everything from asking for one last chance to prove itself, then saying that taxpayers have invested heavily in 1800-MHz infrastructure that would be worthless without spectrum. More recently it has turned to holding these 10 million subscribers hostage.

Those are not my words, as many Thai language newspapers have used that very term to describe the situation with the latest round of rhetorical press conferences.

CAT CEO Kittisak Sriprasert was quoted as saying that the frequency allocation act allowed for the regulator to set a timeframe for return of spectrum and asked the regulator for more time.

I am not sure if this was naivety or just a bad spin doctor as the clause he quoted clearly refers to spectrum not under concession (and 1800 MHz is clearly under concession). The NBTC has decided on a timeframe (15 years for telecom spectrum, 10 for broadcasting which includes 2.5-GHz, and 5 for radio) for non concession spectrum. This has nicely played into the hands of fellow state telco TOT, which now has 15 years to use 2.3-GHz for LTE before it is returned to be auctioned off.

The ICT Minister has also mulled an extension of the concessions during a transitional period.

To that point, the regulator has questioned why anyone would want to remain on a 2G network given that 3G would be 15% cheaper. That statement, in turn, opens up another can of worms. The NBTC - trying to save face after the auction non-event - ordered all the telcos to lower their prices by 15% to reflect the cheap licences. The order was met with a lukewarm response from the operators.

But a mess is hardly new or unusual in Thai telecoms.

What is interesting is how tensions between the independent regulator and the government are appearing more and more strained and the spats becoming more and more public.

The ICT minister is strongly supporting CAT’s stance on 1800, while the other major rift is the money from the 3G auction, which the regulator refuses to hand over to the finance ministry until pending legal cases are settled.

It would take a long, long time before the cases are all finalised given Thailand’s slow judicial system and the fact that the government’s populist policies and tax cuts mean that it needs access to that cash now.

It will be interesting to see how things pan out. ICT Minister Anudith Nakorntap has stated that the regulator must make up its mind within March as to the transition plans. Until then, the opera continues.

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