Thai government sells 5G licenses for $3.2 billion, aiming to commercialize 5G in July

Thai government sells 5G licenses for $3.2 billion, aiming to commercialize 5G in July

Thai government sells 5G licenses for $3.2 billion, aiming to commercialize 5G in July

Tiger Sniff Note: This article is compiled from Malaysia’s “The Star”, “Bangkok Post” and Mobileworldlive.

On February 16, local time, Thailand’s telecom regulator raised 100.52 billion baht (about $3.2 billion) in a 5G spectrum auction. On this day, 48 licenses were quickly divided up by them.

At the end of October last year, Thailand’s telecommunications regulator announced that it would auction off four frequency bands of 5G spectrum for the first time on February 16 to promote nationwide adoption of the ultra-fast wireless technology. The four frequency bands are 700MHz, 1800MHz, 2600MHz and 26GHz. According to the “Bangkok Post” report on October 31, at the time, according to government estimates, these frequency bands could be sold for at least 157 billion baht.

But in November, Deputy Prime Minister Somkid Jatusripitak, during a visit to the country’s Digital Economy and Society Ministry, warned the government not to focus on the huge revenue generated by spectrum auctions. I don’t know if this warning is one of the reasons why the transaction price is much lower than the estimated price.

Previously, the National Broadcasting and Telecommunications Commission (NBTC) stated that the most popular frequency bands for mobile operators are 2600MHz and 26GHz, because most of the countries currently using 5G technology in the world are also using these two frequency bands.

The 2600MHz band will be distributed with 19 licenses, each containing 10MHz bandwidth, with a reserve price of 1.86 billion baht and a total value of 35.3 billion baht.

The 26GHz band contains 27 licenses, each containing 100MHz of bandwidth, and the reservation price is 300 million baht, so the total value of the 27 licenses is 8.1 billion baht.

The 700MHz band is divided into three licenses, each containing 5MHz of bandwidth, with a reservation price of 8.7 billion baht; the 1800 MHz range will have seven licenses, each containing 5MHz, with a reservation price of 12.4 billion baht.

Takorn Tantasith, secretary-general of the National Broadcasting and Telecommunications Commission (NBTC), has said that the regulator is targeting 43 billion baht in auctions for the 2600MHz and 26GHz bands, acknowledging that 700MHz and The 1800 MHz range may not be attractive to major carriers.

Takorn said the reserve price for the 2600MHz band was based on research by Thailand’s Chulalongkorn University, Chiang Mai University and the Thailand Development Research Institute, while the 26GHz band was based on research by Thailand’s Chulalongkorn University, Chiang Mai University and the Thailand Development Research Institute The reserved price of the frequency band is based on the research results of Chalmers University of Technology in Sweden.

Thailand’s 5G development roadmap previously released by NBTC

In the auction on February 16, the biggest winner was AIS Communications (Advanced Info Service Pcl), the largest mobile operator in Thailand. The company won a total of 23 licenses in three frequency bands in a five-hour auction. Thailand’s second and third largest operators True Communications (True Corporation Pcl) and TAC Communications (Total Access Communication Pcl) received 17 and 2 licenses respectively. National Telecommunications Corporation (NT), which was formed by the merger of state-owned enterprises CAT Telecom and TOT, also participated in the auction, and they got 6 licenses.

In the low frequency band of 700MHz, CAT won two 2×5 MHz licenses, while AIS, a subsidiary of Singtel, finally beat True with a price of 51.46 billion baht after 20 rounds of bidding that lasted for more than three hours. license.

In the mid-band 2600MHz spectrum, licenses for 19 10MHz blocks are divided between AIS and True. The two companies received 10 and 9 licenses respectively, with a total price of 37.43 billion baht. It is worth mentioning that True Communications, which is controlled by Thai billionaire Dhanin Chearavanont, actually has a Chinese background, and China Mobile holds an 18% stake in the company.

DTAC, a subsidiary of Norway’s Telenor Group, participated in the auction of the high frequency band 26GHz and took away 2 of the 26 licenses in the 100 MHz frequency band. AIS won 12, True Communications won 8 and TOT took the remaining 4 licenses.

As a result, the 26 GHz license transaction price was 11.63 billion baht, and the total auction price of 2600 MHz was 37.43 billion baht. These two frequency bands finally allowed NBTC to get 49.06 billion baht, which was significantly higher than Tacon’s previous calculation of 430 baht. billion baht.

According to the payment method instructions released by the government earlier, the winning company in the 26GHz band must pay the full price within one year; while the company winning the 700 MHz and 2600 MHz bands does not have to pay all the money within a year, they can pay in installments, but It can only be divided up to 10 times and 7 times, and the order must be paid within 10 years.

Taking the 2600 MHz frequency band as an example, in terms of payment terms, the operator must pay at least 10% of the winning price within one year after obtaining the license; after the second to fourth year, the operator will receive a payment grace period; From the fifth year to the tenth year, the operator is required to pay 15% of the remaining license fee in annual installments.

Under this payment incentive, operators must roll out 5G networks in Thailand’s Eastern Economic Corridor project. And within one year after obtaining the license, the 5G network will cover 50% of the area of ​​the project. In addition, operators must make 5G networks available to at least 50% of the population in the smart city area within four years. Meanwhile, licensed companies can only use these four frequency bands in 5G networks.

“Because the data transmission speed of 5G is more than 100 times faster than that of 4G network, this technology will play a strong role in boosting the development of my country’s digital economy.” Takorn predicts, “This year, 5G technology is expected to contribute to the growth of Thailand’s economy. Contributed 177 billion baht, or 1.02% of the country’s GDP.”

Thailand hopes to start 5G services in July this year, according to a roadmap for 5G plans released by Thailand’s communications regulator; however, Deputy Prime Minister Somchi is more pressing, urging operators to start rolling out 5G services by mid-2020 :

“Thailand is striving to become ASEAN’s digital innovation hub, competing with Vietnam, Malaysia and the Philippines, which all plan to launch commercial 5G services in 2020.”

In response, Somchai Lertsutiwong, CEO of AIS Communications Advanced Information Services, said AIS endorses the government’s goal of enhancing the country’s competitiveness through innovations such as 5G technology. However, he also reiterated that the most suitable time to adopt 5G in Thailand is the end of 2021, and before that, operators still have to do a lot of preparations.

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