Dr Rom Hiranpruk, an advisor to the Ministry of Information and Communication Technology (ICT), told me the other day that the future of Thailand's telecom industry hinges upon a three-pillar platform, with the national broadband network initiative being the core.
The first pillar is to formulate an ICT industry development plan with the national broadband network initiative at the centre. This will establish a market structure that streamlines the roles of different players in terms of fibre, tower, operating and retail companies.
The second pillar is to restructure the state-owned telecom enterprises so that their core competencies are aligned with the national vision, and that they can provide the foundation for a more competitive and economically sustainable telecom industry and ecosystem.
The third pillar is to transform the current 2G (second generation) mobile concessions into a licensing and infrastructure rental model. This will unlock the value in existing concession arrangements to support the build-out of the proposed national broadband network across the country.
The national broadband network aims to provide 50 per cent of the population with at least 2 Mbps (megabytes per second) Internet access within five years. Over the 10-year period, 95 per cent should have 10 Mbps Internet access.
The Internet will become the new national basic infrastructure, similar to today's tap water supply, electricity, transportation and basic education services. It will be the era of e-education, e-healthcare, e-government, e-commerce and e-agriculture once there is a significant broadband penetration rate among the population.
As for state-owned and private firms, their roles will vary according to core competencies. For example, there can be a "fibre company" that focuses on building the passive dark fibre network and other related infrastructure from the core, to the so-called "middle mile". State-owned TOT and CAT could be among the fibre companies.
Complimenting the "fibre companies" will be a "tower company' that controls the physical telecom towers and related equipment. At present, AIS has the largest number of towers nationwide, totalling 15,000 towers, followed by Dtac (about 10,000 towers) and True, a few thousand.
Then, there will be operating companies that lease these infrastructures to create their network on which value-added services will be provided by retail and other of companies. This will lead to a new market structure featuring revitalised state telecom enterprises, while the current 2G concessions will be transformed into a new licensing and infrastructure rental model.
According to Dr Rom, commercial private operators will agree to the conversion of 2G concessions into licenses once they are assured of a level playing field and continued open access to a shared passive infrastructure on a transparent commercial rental basis.
In the meantime, the 3G license auction should proceed within a coordinated framework with a clear link to 2G concession conversion and restructuring of state-owned telecom firms. If this can be executed properly, it will be a triple-win scenario for the government, industry and the general public.