Digital radio, TV auction rules approved

Corporate April 22, 2013 00:00

By Usanee Mongkolporn
The Nation

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The National Broadcasting and Telecommunications Commission (NBTC) has approved the final draft regulations for the planned e-auction of licences to operate commercial digital radio channels and terrestrial digital TV channels.

Among the highlights of the draft, which will be published in the Royal Gazette, is a stipulation that during the e-auction, bidders must propose a higher price than the starting price, and a higher price than the one they quoted in the previous round.

The NBTC’s broadcasting committee has the right to cancel the auction if the total number of qualified bidders is lower than or equal to the number of available licences. The auction could also be cancelled if, during the auction process, some bidders are disqualified, causing the number of total bidders to be lower than or equal to the number of available licences. Winners must propose prices equal to or higher than the licences' reserve price.

The draft rules for the digital radio and TV licence auctions appear different from those of October’s auction of the 2.1-gigahertz licence spectrum, which drew heavy criticism for allowing three winners to snatch the available nine spectrum slots without facing much competition. In that auction, the starting price and reserve price were the same at Bt4.5 billion per spectrum slot. The 2.1GHz auction rules did not mention the possibility of cancelling the bidding if the number of bidders matched the number of available spectrum slots. Of the nine 2.1GHz slots available, six went for exactly the reserve price.

As in the 2.1GHz licence auction regulations, applicants for digital TV licences are obliged to observe the “silent period”, during which they are forbidden from exchanging information and communications with one another regarding the auction. The period lasts from the time that requests for auction applications are accepted until the end of the auction process.

Bidding companies cannot have any shared interests or relations that would give them indirect or direct mutual benefits to winning a licence, whether through management relations, management control over other bidders, or shareholdings, or with partners of other bidders, or have any cross-shareholdings between them.

Bidders that are connected through being owned by the Finance Ministry will not be deemed as having shared interests or relations.

The NBTC’s broadcasting committee is expected to auction 24 commercial digital TV licences in the third quarter. Of the total, seven will be high definition (HD) variety channels, seven standard definition (SD) variety channels, seven SD news channels, and three SD children’s channels.