TOT, CAT present post-BTO business plans

17 Sep 2012

State-owned TOT and CAT Telecom have presented their business plans for continuing operations after the expiry of the revenue-sharing build-transfer-operate (BTO) concessions which were issued by the twin telcos to private sector operators. Thailand’s Finance Ministry, through which the state holds its shares in the telcos, required the pair to finalise business plans promptly, as although the BTO concessions expire at various dates in 2013-2018, under law both TOT and CAT must transfer all BTO concession revenue to the government from December 2013 onwards, whilst private sector cellcos will receive full network operating licences in next month’s 3G licence auction, which will lead to a rapid decrease in revenue-sharing income for TOT and CAT.

TOT’s largest BTO revenue earner is the 2G mobile network operating concession held by cellular market leader Advanced Info Service (AIS), which ends in 2015. TOT is seeking ways to hold on to the 900MHz spectrum that it has granted to AIS under the BTO concession, although as it stands, under the National Broadcasting and Telecommunications Commission (NBTC) spectrum management master plan, both TOT and CAT must hand back any spectrum to the regulator for reallocation at the end of a concession period. As reported by newspaper The Nation, in the case that the NBTC allows TOT to keep the 900MHz spectrum, the state-run firm will invest in upgrading the network to offer 3G (UMTS-900) services, building on the 900MHz W-CDMA/HSPA infrastructure which AIS has already deployed in some provinces. Under this scenario, TOT would also set up a company to rent tower infrastructure to companies receiving full 3G 2100MHz network operating licences in the NBTC’s 3G auction scheduled for 16 October 2012, and also to future 4G service providers. TOT has 9,000 telecom towers and AIS has 15,000. TOT expects annual revenue of THB7 billion (USD225 million) from renting out all these towers. However, if TOT has to hand over the 900MHz spectrum – ahead of a future licence auction proposed by the NBTCTOT will allow the winners of the 900MHz auction to rent the network built by AIS. TOT’s other BTO agreements include fixed network concessions held by True Corp (in Bangkok and central regions) and TT&T (in north and south provinces), which both expire in 2017, TeleGeography’s GlobalComms Database notes.

CAT Telecom’s business plan says that it intends to operate as a network provider after the expiry of its BTO concessions, although this plan hinges on the possibility of the NBTC allowing CAT to keep the 1800MHz spectrum issued under the BTO agreements for at least ten years after the concessions end. Moreover, the private mobile concession holders would have to transfer their network assets to CAT after the contracts expire. CAT would then rent out these networks while also using the 1800MHz spectrum to continue to serve the current customers of its concession holders. CAT is engaged in arbitration disputes with all of its BTO concessionaires, which are lobbying to keep the network assets they have built out after the BTO expiry dates, rather than transferring them back to CAT. BTO concessions issued by CAT include those held by True Move and AIS’ small 1800MHz operating subsidiary Digital Phone Co (DPC) which expire in September 2013, while DTAC’s ends in 2018. CAT is also in talks with True Corp subsidiary BFKT (Thailand) to acquire its 850MHz 3G network infrastructure (which CAT currently rents) to progress its plan to be a network provider.

Thailand, CAT Telecom, TOT,

Subscribe

Subscribe to CommsUpdate to get the day’s top telecom headlines delivered to your email.

Subscribe to CommsUpdate

Browse Past Issues

Filter

Filter CommsUpdate by the following categories or use the search.

Search

Visit our help page information on performing advanced searches, including how to restrict the results by country or company.

Advertise

CommsUpdate is an outstanding advertising venue for companies seeking to reach:

  • International carriers
  • Wholesale service providers
  • Equipment and software vendors
  • Telecom investors
  • Regulators

Learn more about advertising on CommsUpdate.

Share