Cat Telecom Pushes Harder For Hutch Cdma Takeover

[george]

TELECOM

CAT Telecom pushes harder for CDMA takeover

By USANEE MONGKOLPORN

THE NATION

Published on October 4, 2010

Jirayuth says proposed option is much better than TOT's planned 3G roll-out

BANGKOK: -- CAT Telecom's chief executive officer Jirayuth Runsgrithong has strongly insisted that the plan to buy Hutchison Telecom's network in 25 provinces is important for the state agency's future.

Despite questions over whether the investment was worthwhile, Jirayuth said last Friday that the Code Division Multiple Access (CDMA) 2000 1-x wireless broadband network in 25 provinces is |not "metal scrap" as dubbed by Information and Communica-|tions Technology Minister Chuti Krairiksh.

The minister has asked him to give a clear answer within one month about how CAT will benefit from the purchase.

"What we'll buy is the future of our business opportunity," Jirayuth claimed.

Recently, Jirayuth said that Hutchison had already written off the network but it still has higher bargaining power than CAT, which wants to merge the network with its own separate CDMA network in 51 provinces to enable it to provide seamless nationwide service. Both began talks on a possible takeover in 2006.

Jirayuth said the Hutchison network, which was launched seven years ago, has 1,400 base stations, while CAT has 1,600 base stations in 51 provinces at a cost of Bt7.9 billion.

The Finance Ministry opined that the value of the Hutchison network in 25 provinces should be half that of the CAT network in 51 provinces or around Bt3.9 billion. Jirayuth said it was impossible to pay only around Bt3.9 billion for the Hutchison network.He added that highest goal is that after merging the two networks, CAT will upgrade the consolidated network from the present 3G technology to the 4G technology. When asked if it would make more financial sense for CAT to install new 4G network on its own in 25 provinces, he said CAT needs the Hutchison network in order to get the network's customer base and base station locations.

READY REVENUE

He said the Hutchison network, which has around 700,000 customers, earns a monthly revenue of around Bt400 million. The customer numbers have declined from around 1 million early this year when Jirayuth also said it generated Bt400 million monthly. Hutchison's wholly-owned firm BFKT owns the network in 25 provinces, which it has leased to Hutchison-CAT Wireless Multimedia to market the service under the Hutch brand and CAT's marketing contract. Hutchison-CAT is a 75:25 per cent joint venture. Jirayuth said CAT has gained around Bt800 million revenue per year from Hutchison-CAT.

As ordered by the ICT ministry, CAT will hold talks with Hutchison to lower the price of the network and other Hutchison related businesses in Thailand that CAT would like to take over.

Jirayuth said if the talks fail, CAT might have to abort the planned takeover.

The Cabinet approved a budget of Bt7.5 billion for CAT in April for the takeover, of which Bt7.2 billion is for the Hutchison network and its related businesses, and the rest for the takeover related cost.

Of the total payment, around Bt1 billion is for Hutchison to install the Rev B software on its network in 25 provinces to boost the data transmission speed capacity.

Jirayuth said Hutchison could install the software on the network faster than CAT.

CAT will spend another Bt3.8 billion to install the same software on its own CDMA network.

The Cabinet has approved the budget already but the board has yet to give it the go-ahead.

He said the CAT's planned takeover of Hutchison's network is more viable than the TOT's plan to roll out the 3G network nationwide at a cost of over Bt19 billion.

The Hutchison network already has a customer base and the takeover cost is lower than the value of TOT's planned 3G network.

-- The Nation 2010-10-04

[billd766]

With respect to the people concerned there is NO WAY that CAT taking over Hutch will give them a "nationwide" service coverage.

Even AIS with over 15,000 cell sites has a problem in a very few localities and DTAC are similar with 12,000 odd sites.

A combination of CAT/Hutch will give them only 3,000 sites using their figures which is nowhere near enough.

Granted it will give them sites in all 72 provinces and the joint infrastructure is very valuable but the service coverage area is great if you live in a city or a big town or on a main road trunk route but there are large pyhsical areas with no coverage at all.

I live 65 km south west of Khampaeng Phet near the Mae Wong national park and I have been waiting more than 7 years for a simple phone line.

I wet to the CAT office in KP and asked to see a coverage map and thy didn't have one so I explained where I live and it seems my closest site is about 40 km away with no plans to build anything nearer.

I retired last year after 20 years of building mobile phone networks across the world so I do have some idea of what I am talking about and probably a lot more than the CEO of CAT.

[RKASA]

We are just outside Phitsanulok and have been waiting 11 years for phone service, but good news came today, at noon in fact. Be it only a rumor in official terms, but from a vary vary good source. We are getting our adsl within 4 months. The great news is - I live next to the lot that has the ToT easement and they are putting the Dslam right next to my house.

I walked it off and the Dslam will be about 75 meters of wire from the outside wall of my home office.

Good bye IpStar

[billd766]

We are just outside Phitsanulok and have been waiting 11 years for phone service, but good news came today, at noon in fact. Be it only a rumor in official terms, but from a vary vary good source. We are getting our adsl within 4 months. The great news is - I live next to the lot that has the ToT easement and they are putting the Dslam right next to my house.

I walked it off and the Dslam will be about 75 meters of wire from the outside wall of my home office.

Good bye IpStar

Now I am jealous but I live on a road which goes up into a national park and dead ends up there.