Nbtc Vows Limits On 3G Fees Soon: Thailand

[webfact]

NBTC vows limits on 3G fees soon

USANEE MONGKOLPORN,

SIRIVISH TOOMGUM

THE NATION

BANGKOK: -- The National Broadcasting and Telecommunications Commission (NBTC) has vowed to speedily issue regulations spelling out the maximum fees for 3G voice and data services provided under its licences to ensure that the three winners of this week's spectrum auction do not charge their clients high prices.

NBTC secretary-general Takorn Tantasit made the remark yesterday during a ceremony to hand letters to the three bid winners - Advanced Wireless Network of Advanced Info Service (AIS); DTAC Network of Total Access Communication (DTAC); and True Corp's Real Future - officially approving the results of their bids at Tuesday's auction of 2.1-gigahertz (GHz) spectrum slots.

Jesada Sivaraks, the secretary to the NBTC's vice chairman, said the watchdog was urgently drawing up a condition to be attached to the licences stating that fees cannot exceed a certain ceiling, which the watchdog is in the process of determining. In parallel, the NBTC is drafting the main regulations that will permanently establish the charge ceiling for voice and data services for 3G licence holders.

Takorn added that average airtime tariffs for 2G mobile-phone voice services should also be lower than the present 99 satang per minute.

Duenden Nikomborirak, a scholar at the Thailand Development Research Institute and a member of the NBTC consumer protection subcommittee, said the NBTC must issue all key regulations quickly to ensure consumers get better services and fair prices from 3G licence holders. She noted that despite the market liberalisation via 3G licensing, the bid winners were the existing major players.

NO TIMEFRAME

Executives of the three operators yesterday said they want to launch their 3G services as soon as possible but declined to specify a timeframe as they first want to ensure service quality and that the watchdog has completed drawing up its regulations.

Advanced Wireless Network became the first bid winner to pay the required 50 per cent of the final up-front spectrum fee, plus VAT, to the NBTC. It yesterday handed over a cashier's cheque worth over Bt7.824 billion issued by Bangkok Bank. It also produced for the NBTC guarantees from Bangkok Bank, Kasikornbank, Bank of Ayudhya, TMB Bank and Thanachart Bank to show that it can pay another 25 per cent of the fee in the second year and the remainder in the third year as required by the auction terms.

Each of the three are required to pay 50 per cent of the total spectrum fee up-front, plus VAT, within 90 days from yesterday, another 25 per cent in the second year of operation and the remaining 25 per cent in the third year. The NBTC will immediately transfer the amount to the state coffers.

Real Future will pay 50 per cent of its fee on Monday, while DTAC Network is expected to pay sometime next week. The NBTC's telecom committee is expected to grant licences to Advanced Wireless Network and Real Future by the end of this month.

Advanced Wireless Network paid a total of Bt14.625 billion for three slots, while DTAC Network and Real Future both paid Bt13.5 billion for the three slots they each acquired.

AIS has set aside a budget of Bt50 billion to cover both the 2.1GHz spectrum fee bid and the 3G network rollout during the first three years. DTAC has allocated Bt40 billion for its spectrum bid and three-year rollout.

True chief financial officer Noppadol Dej-udom said the firm would spend Bt20 billion on network rollout in the initial phase.

"True will also seek a strategic partner to strengthen our 3G business," he added.

The NBTC yesterday sent a letter to the Finance Ministry urging it to take action against its deputy permanent secretary, Supa Piyajitti, who sent a letter warning the watchdog that its spectrum auction on Tuesday did not comply with the ministry's e-auction rules and could be deemed as having helped private bidders grab the precious national resource at a low price at the state's expense. In an individual capacity, Supa also sent a letter to the National Anti-Corruption Commission asking it to probe whether the auction breached the State Bidding Act 1999.

In its letter, the NBTC claimed Supa's action could damage the watchdog's reputation and create misunderstanding among the public. It said that she had to show responsibility for her actions.

Takorn said the 2.1GHz spectrum auction on Tuesday was not a case of procurement, thus it was not subject to state procurement regulations. He also cited Article 45 of the 2010 frequency allocation law, which obliges the NBTC to grant the spectra by means of auction only.

Meanwhile, major ratings agency Standard & Poor's said it believed the 2.1GHz spectrum auction was a positive development for Thailand's telecom industry.

"The auction will help improve our assessment of above-average regulatory and industry risk in Thailand. It will help telecom companies grow and improve their profitability in the next three to four years. This is because they can provide higher-value 3G services; the licence fee for 3G is about 6 per cent of revenues compared with the existing concession fee of about 25 per cent of revenues," the rating agency said.

-- The Nation 2012-10-20

[KarstenBoAndersen]

We have 3G already in some towns and out fee's had not changed.

I think it is 650 Baht onlimited datause ! Is that expensive ??? In Europe i had not seen any unlimited under 2500 Baht and it still had some restrictions.

Competision is the best regulator (but in a country runned by corruption all think they need to control!!) !

[asiawatcher]

What sort of BS is this? NBTC scams skin in the game to the tune of billions to get a seat so they can make a bid, now vows to dictate price? Ever heard of price fixing and you can't change the rules once the ball is in play? Amazing Thailand - and if I was one of the winning bids I would certainly be telling them to jamb it sideways where their mother never kissed them.

[Thai at Heart]

Can the bidders ask for a refund.

Amazing, have an auction then make up the terms afterwards.

[MaxLee]

Never mind that the regulation procedures of the finalization will take another 10 years

Oh never mind that the infrastructure for such a high speed service has never existed in The first place.

People pay for service that never really existed

[SOTIRIOS]

....another 'blood-sucking' scenario.....never a clean, straight deal or business arrangement to be had in Thailand....

...if people will swindle emergency relief bottled water........what do you expect.....

[Markaew]

Have they figured out how to double price the foreigners yet?

[jbrain]

What sort of BS is this? NBTC scams skin in the game to the tune of billions to get a seat so they can make a bid, now vows to dictate price?

Isn't that exactly the same as is done in Europe and the US, with the only difference that the fees are much higher?

[bkk_mike]

We have 3G already in some towns and out fee's had not changed.

I think it is 650 Baht onlimited datause ! Is that expensive ??? In Europe i had not seen any unlimited under 2500 Baht and it still had some restrictions.

Competision is the best regulator (but in a country runned by corruption all think they need to control!!) !

Where did you look?

3 (www.three.co.uk), on pay as you go in the UK - it's £15 for unlimited data for 30 days (look for "All in one 15"), with 300 minutes of calls and 3000 texts added in.

£15 is about 750 baht, but the £15 includes 20% VAT, so is £12.50 pre-tax, which, at approx 625 baht, is basically the same as the amount they're quoting, which in Thailand, will not have included the tax, and they're not throwing in SMS and voice calls with it.

[lomatopo]

The NBTC appears to have the mandate, untested judicially and elsewhere, to dictate pricing.

They have ordered DTAC and AIS to offer 1 baht/min cap. voice pricing by the end of this year. (TreuMove was excluded from this edict.)

Obviously this latest news is in response to the outrage regarding the results of the auction.

With three providers on more or less equal footing they should be competitive and pricing should remain reasonable, which I think it is today.

But I think we need to see "... regulations spelling out the maximum fees for 3G voice and data services...".

There were a lot of rules published before the auction which winners would have to adhere to: re: the service, 50% of the population with access within 2 years, then 80% of the population within 4 years. They probably should have set price caps at that time as well?

I guess, in retrospect, there should have been some public consensus re: minimum acceptable bids before the auction. Maybe the oft quoted Chula ~ 6 ish billion?

I'd prefer to see this auction finalized, time to move on and consider it a learning process. For future auctions, 800, 900, 1800 MHz -if these do happen, TOT/AIS, CAT/True may not return their spectrum, they can try to do things differently.

I'd like to hear more about what the auction proceeds will be used for, straight into the general fund? Or will it end up in some Ministry's Secretary's home, only to be stolen while he is at his daughter's wedding.

Edited October 22, 2012 by lomatopo

[whybother]

We have 3G already in some towns and out fee's had not changed.

I think it is 650 Baht onlimited datause ! Is that expensive ??? In Europe i had not seen any unlimited under 2500 Baht and it still had some restrictions.

Competision is the best regulator (but in a country runned by corruption all think they need to control!!) !

Where did you look?

3 (www.three.co.uk), on pay as you go in the UK - it's £15 for unlimited data for 30 days (look for "All in one 15"), with 300 minutes of calls and 3000 texts added in.

£15 is about 750 baht, but the £15 includes 20% VAT, so is £12.50 pre-tax, which, at approx 625 baht, is basically the same as the amount they're quoting, which in Thailand, will not have included the tax, and they're not throwing in SMS and voice calls with it.

... and then 15 baht per minute for calls after you go over that.