Trio agree to buy 700MHz licences
Proceeds will ease operators’ burden
Both the digital TV and mobile sectors have at last received financial relief via the government’s Section 44 powers, with all three major mobile operators agreeing to buy slots on the 700MHz band for a combined 56.44 billion baht.
The three operators — True Move H Universal Communication (TUC), Advanced Info Service (AIS) through subsidiary AWN and Total Access Communication (DTAC) — submitted applications yesterday with the National Broadcasting and Telecommunications Commission (NBTC) to buy 700MHz licences, each valued at 18.81 billion baht (including VAT).
Of the total combined 56.44 billion baht, 36 billion will be used to ease digital TV operators’ financial burden, according to the Section 44 order in April. The remaining 20.44 billion will be passed on to the state coffers.
After the allocation for sale, TUC was awarded the first slot while DTAC got the second and AIS the last. The three mobile operators have to make licence payments via 10 years of instalments, with the first due Oct 15, 2020.
The 700MHz range is currently being used by digital TV operators.
NBTC secretary-general Takorn Tantasith said the result of the 700MHz licence sale has already resolved the financial deadlock for both digital TV operators and major telecom operators.
Under Section 44, the major three operators are allowed to extend their existing licence payments for 900MHz spectrum for another five years if they purchase the 700MHz licences.
The government will waive the remaining two terms of all digital TV operators’ licence payments at a combined 13.6 billion baht, as well as subsidise their rental fees for broadcasting networks (MUX) worth 18.7 billion baht for the remaining nine years of the digital TV licences.
Money from the 700MHz sale will be partly used to assist all digital TV operators.
Mr Takorn said that although the first instalment of the 700MHz licences will come in October 2020, the regulator will provide assistance to digital TV operators through the NBTC’s fund in advance for helping TV operators.
When the mobile operators begin paying their instalments, the NBTC will return the money to its fund.
The NBTC urged MUX operators to submit plans for the rearrangement of their existing wavelength division to prepare for utilisation of the 700MHz range.
MUX operators have to submit plans by August this year and should finish the transfer of existing slots in July 2020.
“We target awarding the 700MHz licences in October next year, and the operators can begin utilising the range for serving telecom services such as 4G capacity expansion or prepare for upcoming 5G adoption,” Mr Takorn said.
GAME OF SLOTS
Regarding the 700MHz sale, as of yesterday TUC got the first slot or 703713MHz for upload and 758-768MHz for download, DTAC got 713-723MHz for upload and 768-778MHz for download, and AIS got 723-733MHz for upload and 778-788MHz for download.
An industry source said TUC needed the first slot because it is adjacent to its existing 850MHz range, operating under a partnership agreement with CAT Telecom.
AIS needed to grab the third slot because that slot is adjacent to its remaining 700MHz slot, which has yet to be allocated. AIS sees it as a flexible opportunity if it bids for another 700MHz slot to enlarge its bandwidth.
Meanwhile, DTAC has no distinct advantage choosing a specific slot.
AIS chief executive Somchai Lertsutiwong said holding additional spectrum bandwidth is critical for mobile operators, especially for paving the way for 5G adoption.
“The decision to buy the 700MHz licence came through the board and consultants’ consideration of all related factors, including utilisation and pricing,” he said.
Vichaow Rakphongphairoj, cogroup president of True Corp, said the company will urge the NBTC to consider that the next spectrum auctions should have reasonable prices to facilitate innovation.
Alexandra Reich, chief executive of DTAC, said the board’s decision will benefit all parties because the 700MHz spectrum can be used for 5G development.
“By adding the spectrum allocation, we will have additional low-frequency spectrum that will be added to the 2x10MHz service,” Mrs Reich said. “As a result, DTAC will have a total service frequency of 130MHz”, including 2300MHz frequency roaming on TOT spectrum.