NTC asks consultant to clarify 3g licensing

An NTC source said yesterday the NTC seems to favour combining the auction and so-called beauty contest methods for awarding licences and is uncertain if selling them to the highest offers would be the most appropriate way.

The advisory group led by InterConnect Communications leans toward putting licences to operate 2.1-GHz spectrum bands up for bidding.

A "beauty contest" would see applicants with the most viable proposals bagging the licences.

Telecom operators complain that an auction would put a heavy financial load on the bid winners, which would likely pass the costs quickly on to subscribers. The NTC asked the consultant: If an auction was the best licensing procedure, why was four licences the best number? And why was the licence reserve price set at around Bt3 billion?

NTC member Rianchai Reowilaisuk said the NTC was likely to award the licences by the auction method, with pre-qualification, and the licence term would be 15 to20 years. He made the remark at the "3G and HSPA Mobile Broadband Lifestyle" seminar hosted by Telecom Journal. The other panellist, Sanchai Thiewprasertkul, chief marketing officer at Advanced Info Service (AIS), said mobile broadband networks would soon surpass fixed-line broadband networks, due to the smaller investment required.

The price of 3G mobile phones had been dropping by 12 per cent per quarter to about US$50 (Bt1,700) now from $400 in 2003, he said.

AIS kicked off its 3G service in Chiang Mai in May on its existing 900MHz spectrum, while Total Access Communication and True Move are expected to follow soon on their 850MHz bands.

Sanchai said the 3G service providers should not use low pricing to woo users. It would encourage the downloading of bandwidth hungry contents such as movies against the limited bandwidth available until networks were jammed.

Thai Mobile, the 58:42 joint venture of TOT and CAT Telecom, owns the 1900MHz band, the international platform for offering 3G service.

The now defunct frequency allocation committee awarded the spectrum to be jointly owned by TOT and CAT in January 2000, but so far Thai Mobile has yet to develop a 3G service. Its spectrum term will expire in March 2027.

TOT and CAT have not agreed which will take 100-per-cent control of Thai Mobile and steer it to develop a 3G service.

TOT senior executive vice president Kittipong Tameyapradit said that if TOT could take over Thai Mobile, it would position Thai Mobile as a 3G network lessor.

It might invest on its own or with partners on the 3G-network rollout in key strategic areas. The service could be up and running in a year and a half.