A source at the Information and Communications Technology Ministry said yesterday that if cellular operators opposed the proposal, one option was for them to pay the higher revenue share of 35 per cent instead.

Currently, Advanced Info Service (AIS), Total Access Communication (DTAC), True Move and Digital Phone have each paid around 25 per cent to their state concession owners TOT or CAT Telecom.

TOT and CAT will each set up a negotiation committee according to the 1992 Act to negotiate with cellular concessionaires and make their past concession amendments comply with the law. The panel will also promote a level playing field for the industry by imposing the same revenue-sharing formula on all operators.

ICT Minister Sitthichai Pookaiyaudom said yesterday his guidelines for the negotiations were:

lThe mobile concessions should not be revoked

lThe state concession owners should not lose advantage

lConsumers should not be affected

lThe concession amendments must be made to comply with the law.

The negotiations will also touch on the revision of the extended concession periods of some cellular operators, he added.

While Sitthichai wants the negotiations to be concluded before the government's term ends in October, a telecom industry source said the talks were unlikely to be wrapped up so soon, given that no one would want to experience higher business costs.

He said that in 2001 when AIS could reduce its prepaid revenue share, the same time DTAC could change its access charge payment formula, there were 4.5 million mobile-phone subscribers in Thailand.

 But in 2002, the total of phone subscribers jumped to 13 million as both AIS and DTAC had spent their budgets, gained from the reduction of their revenue sharing, by offering promotions to consumers to enable them to afford mobile-phone services.

Executives of AIS, DTAC and True Move said they were willing to negotiate with the negotiations committee.

"In principle, we want to cooperate with the government. But we need to study in detail how they plan to do it," AIS president Wichien Mektrakarn said yesterday. He was speaking at a seminar entitled "The turning point of telecom investment in Thailand", jointly held by the Economic Reporters' Association and Business Radio FM98 channel.

The ICT minister had asked the Council of State to look into the mobile-phone concessions and to assess if the concession amendments in the past were in line with the law.

The Council of State declared last Friday that all amendments of the mobile-phone concession contracts in the past did not comply with

the 1992 Act, which requires the public-private joint venture to be approved by the Cabinet if the project value is Bt1 billion or higher.

The ruling gives a leverage to the ICT minister to make them adhere to the law and to pursue his intention to revise their concession fee to the uniform rate of 30 per cent to promote fair competition among all mobile-phone service concessions.

One of AIS' key concession amendments is the reduction in prepaid concession fees to the flat rate of 20 per cent since 2001 until the concession ends. From 2001 to 2005, AIS had to pay 25 per cent of its prepaid call revenues to TOT, in accordance with the original concession, with the rate rising to 30 per cent from last year to the end of the concession in 2015.

A telecom analyst estimated that the retroactive fee from 2001 until last year would cost AIS Bt13.5 billion.

The negotiation committee will present the report of its negotiations with the cellular operators for Cabinet approval within 90 days of reaching its conclusions.