Fresh Dilemma As Thai Govt Struggles To Fix 3G Auction Setback

[webfact]

New 3G storm set to break

By The Nation

Fresh dilemma as Abhisit govt struggles to fix auction setback

A new 3G storm is brewing for the government, as proposed investments involving the TOT and CAT Telecom are being seen as serving certain groups of busi?nesses and politicians.

Prime Minister Abhisit Vejjajiva and Information and Communications Technology Minister Chuti Krariksh face a fresh critics' outbursts if they decide to support TOT's plan to roll out a new, nationwide 3G net?work at the cost of almost Bt20 bil?lion.

An ICT Ministry source said that if both decided to support the proj?ect, which will be tabled at the Cabinet meeting today, they might risk criti?cism for promoting a project that would only benefit some groups.

However, not supporting the plan - which was added to the Cabinet agenda on Friday by Deputy Prime Minister Suthep Thuagsuban in Abhisit's absence - would make both the premier and Chuti into stumbling blocks to TOT's business plan. Abhisit was away in New York when Suthep tabled the plan.

A similar dilemma awaits CAT Telecom's planned purchase of the wireless network from Hutchison Telecom. The government approved the budget for CAT in April, but Chuti wanted the price to be brought down to Bt4 billion from Bt7.2 billion.

Chuti said yesterday that he could not tell if the Cabinet would today consider the TOT investment project.

The project was put forward for Cabinet consideration several times before, but the Cabinet always asked TOT and related state enterprises to meticulously review it to ensure max?imum commercial viability.

It is apparent that TOT wants to roll out the network soon, before any private competitors enter the 3G field. The Supreme Administrative Court recently ruled to temporarily suspend the planned 3G licence auction by the National Telecommunications Commission (NTC) until the Central Administrative Court comes to a final decision on CAT Telecom's case chal?lenging the commission's licensing authority.

Last week, labour unions from both TOT and CAT criticised Chuti for his negligence in supporting the two state agencies protecting their interest from the possible effect of NTC's 3G licensing.

TOT's 3G nationwide network project was first approved in September 2008, when TOT pro?posed to invest Bt29 billion on 5,220 base stations.

In August, TOT's board cut the budget down to Bt19.980 billion and increased the number of base stations to 5,320. Of the total, TOT will spend Bt17.450 billion on network equip?ment and pay the rest to suppliers for the expansion of its existing 3G net?work in Greater Bangkok.

A telecom industry source said Abhisit was also concerned about TOT's plan to call for a local bid of its 3G network, instead of an interna?tional one. TOT said the local bid could be completed in a shorter time.

Under an international bid, sup?pliers will need to seek their own financing, while under a local bid, stateowned Krung Thai Bank will be asked to lend to the local bid winner.

TOT estimated that the nation?wide project would breakeven with?in seven years and targets 7.4 million subscribers by 2015, up from the 5 million estimated in the previous plan. TOT's 3G network in Greater Bangkok had around 200,000 subscribers after it debuted last December.

Chuti recently also ordered CAT to talk Hutchison Telecom into lower?ing the price of its CDMA 2000 1x cellular network to about Bt4 billion. That figure is lower than the Bt7.2 billion CAT was prepared to pay to the Hong Kong telecom operator to take over its code division multiple access network and telecom businesses in Thailand.

Chuti reasoned that it was not nec?essary for CAT to pay a high price for the network and that it should save money for something else as part of the state plan to promote CAT and TOT as national network providers.

Abhisit said yesterday said that the Cabinet was ready to review its April decision allowing CAT to take over the CDMA network if the ICT minister proposes it.

CAT wants to merge the Hutchison network, which serves 25 provinces, with its own CDMA net?work in 51 provinces to provide seam?less nationwide service.

In a separate matter, Federation of Thai Industries' chairman Payungsak Chartsutipol urged the government to solve regulatory risks in Thailand to shore up foreign investors' confi?dence.

He said the temporary suspension of the NTC's 3Glicence auction affected the confidence of foreign investors and made them see Thailand as having several regulato?ry risks. He made the remark yester?day at the third SCB SMEFTI Factory Outlet fair.

-- The Nation 2010-09-28

[gotlost]

FRESH!! Whats new about greed and corruption. It has always been about this.

[jayjay0]

FRESH!! Whats new about greed and corruption. It has always been about this.

Fresh would be to let 3G do what ever it does without the government let the companies fight it out. The Government should be working on 4G . How long is the government planing on holding Thailand back?

Edited September 28, 2010 by jayjay0

[webfact]

Cancellation of 3G auction shakes investor confidence, says FTI

BANGKOK: -- A court decision to issue an injunction suspending the planned auctioning of Thailand's third generation (3G) network system has shaken confidence among foreign investors keen on investing in Thailand because they fear they could face legal barriers and regulatory risks if they invest here, according to Federation of Thai Industries (FTI) chairman Payungsak Chartsutipol.

He said the delay in approving granting the 3G licenses could make Thailand lose opportunity and affect many businesses and people, particularly those living in rural areas, who cannot access information by hi-speed Internet at an affordable price.

By cancelling the auction, Thailand could lag behind other countries.

Because of this, the FTI wants the government to step up efforts to eliminate regulatory risks to restore investor confidence.

Regarding the continued strengthening of the baht, Mr. Payungsak said the state sector, particularly the Bank of Thailand, should be clear regarding whether it will oversee the baht or not.

Should the central bank continue hinting the baht will strengthen further, the currency will move in that direction, reducing revenue earned by exporters and eroding domestic purchasing power as well.

However, Mr Payungsak affirmed the stronger baht had not yet negatively impacted employment nor caused any businesses to close or suspend operations. It had just made incomes and profits earned in the private sector decline. (MCOT online news)

-- TNA 2010-09-28

[Thai at Heart]

Cancellation of 3G auction shakes investor confidence, says FTI

BANGKOK: -- A court decision to issue an injunction suspending the planned auctioning of Thailand's third generation (3G) network system has shaken confidence among foreign investors keen on investing in Thailand because they fear they could face legal barriers and regulatory risks if they invest here, according to Federation of Thai Industries (FTI) chairman Payungsak Chartsutipol.

He said the delay in approving granting the 3G licenses could make Thailand lose opportunity and affect many businesses and people, particularly those living in rural areas, who cannot access information by hi-speed Internet at an affordable price.

By cancelling the auction, Thailand could lag behind other countries.

Because of this, the FTI wants the government to step up efforts to eliminate regulatory risks to restore investor confidence.

Regarding the continued strengthening of the baht, Mr. Payungsak said the state sector, particularly the Bank of Thailand, should be clear regarding whether it will oversee the baht or not.

Should the central bank continue hinting the baht will strengthen further, the currency will move in that direction, reducing revenue earned by exporters and eroding domestic purchasing power as well.

However, Mr Payungsak affirmed the stronger baht had not yet negatively impacted employment nor caused any businesses to close or suspend operations. It had just made incomes and profits earned in the private sector decline. (MCOT online news)

-- TNA 2010-09-28

foreign investors keen on investing in Thailand because they fear they could face legal barriers and regulatory risks if they invest here, according to Federation of Thai Industries (FTI) chairman Payungsak Chartsutipol.

I think foreign investors are already more than aware of the enormous legal barriers to entry in this country, unless of course, they choose to give away 51% of their company, and find a partner who can "smoothe" things along as they say.

I think what me means to imply is that despite Thailand's already very restrictive FDI laws, we now have the added problem that the courts actually want to enforce the odd law here and there.

[hammered]

Sounds like the bureaucracy having seen off any pesky challenge to its utter domination is now moving forward to cement its position. This whole process is looking murkier and dodgier by the day. It also looks like the right hand and left hand in the government dont know what each is doing, or is it just certain power cliques are already assuming Abhisit is banned and gone.

[Thai at Heart]

Sounds like the bureaucracy having seen off any pesky challenge to its utter domination is now moving forward to cement its position. This whole process is looking murkier and dodgier by the day. It also looks like the right hand and left hand in the government dont know what each is doing, or is it just certain power cliques are already assuming Abhisit is banned and gone.

Well, do you honestly think the "certain power cliques" want a PM hanging around too long who's government starts discussing messing with bank fees, possibly implementing land taxes, threatening TOT/CAT's existence, holding up Mapthaput (although that admittedly isn't entirely his fault but he will get the blame).

The cliques in this country love a politician as long as he adds weight to their pocket, not make it lighter. I think the Dems may well find themselves in very deep water with this investigation, which as petty as it may be, is simply a nice way of holding a knife over Abhisit.

[animatic]

TOT and CAT seem to obviously want to insert themselves before all private companies,

and licence the service to them. So of course fees will be 30% higher for customers.

[Thai at Heart]

TOT and CAT seem to obviously want to insert themselves before all private companies,

and licence the service to them. So of course fees will be 30% higher for customers.

It's tough being a business which simply insert itself into the value chain and serves no other purpose than to suck value out of it.

On one level we have the Consumer Protection bunch saying they can't intervene in bank charges, meanwhile we have CAT and TOT acting as though increasing revenue for the government (although there is no guarantee that inserting themselves into the chain actually increases revenue) is in the NATION's interest.

They don't understand that the consumer's interest is the NATION's interest.

[laocowboy2]

Cancellation of 3G auction shakes investor confidence, says FTI

BANGKOK: -- A court decision to issue an injunction suspending the planned auctioning of Thailand's third generation (3G) network system has shaken confidence among foreign investors keen on investing in Thailand because they fear they could face legal barriers and regulatory risks if they invest here, according to Federation of Thai Industries (FTI) chairman Payungsak Chartsutipol.

He said the delay in approving granting the 3G licenses could make Thailand lose opportunity and affect many businesses and people, particularly those living in rural areas, who cannot access information by hi-speed Internet at an affordable price.

By cancelling the auction, Thailand could lag behind other countries.

Because of this, the FTI wants the government to step up efforts to eliminate regulatory risks to restore investor confidence.

Regarding the continued strengthening of the baht, Mr. Payungsak said the state sector, particularly the Bank of Thailand, should be clear regarding whether it will oversee the baht or not.

Should the central bank continue hinting the baht will strengthen further, the currency will move in that direction, reducing revenue earned by exporters and eroding domestic purchasing power as well.

However, Mr Payungsak affirmed the stronger baht had not yet negatively impacted employment nor caused any businesses to close or suspend operations. It had just made incomes and profits earned in the private sector decline. (MCOT online news)

-- TNA 2010-09-28

Another gem of sloppy reporting - "Should the central bank continue hinting the baht will strengthen further, the currency will move in that direction, reducing revenue earned by exporters and eroding domestic purchasing power as well". Err no.... domestic purchasing power is actually boosted by an appreciating currency as imported good or intermediates (oil etc) become cheaper in THB terms.

[Pib]

Can you spell "monopoly," as in government control of communications. No, no, lets refer to CAT and TOT as the country's national champions for telecommunications as that sounds warm and fuzzy. Just a shame that Thailand's telecommunications governance/laws/regulations are so flawed, where challenges in the court system easily win due to the flaws.

[asiawatcher]

"... A new 3G storm is brewing for the government, as proposed investments involving the TOT and CAT Telecom are being seen as serving certain groups of businesses and politicians."

Naaaaah, really?

[Gobbledoc]

I can spell monopoly Thai style 'mon?opoly" or is it 'mono?poly' last week it would have been 'mon-opoly' or mono-poly. Got ta lu-v this news sou?ses Engrish

Can you spell "monopoly," as in government control of communications. No, no, lets refer to CAT and TOT as the country's national champions for telecommunications as that sounds warm and fuzzy. Just a shame that Thailand's telecommunications governance/laws/regulations are so flawed, where challenges in the court system easily win due to the flaws.

Edited September 28, 2010 by Gobbledoc

[surangw]

fix auction

fix as in repair or fix as in rigg the auction ?