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According to the Telco’s Chairman Teerawut Boonyasopon, TOT’s plan to relaunch failed GSM mobile operator Thai Mobile as a nationwide UMTS 3G wholesale service provider is likely to suffer delays due to political red tape. Recently, TOT has decided to buy all the shares not owned in Thai from sister telco CAT. They have proclaim the plan to invest a total of $870 million to roll out a network of 5,200 W-CDMA base stations by 2012 and rent capacity to private mobile operators. After the approval from the Finance Ministry, the National Economic and Social Development Board, the Office of the Public Debt Management and the cabinet, TOT will begin to draft the TOR (Terms of References). Also call for the auction of the electronic equipment.

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Thai state-owned telco TOT has announced that it will upgrade its copper wire PSTN network on the holiday island of Phuket to support the introduction of an improved range of services, including a doubling of ADSL speeds to 2Mbps at the existing price of THB1,000 (USD32) per month. Regional TOT director Pairoj Somsri said the upgrades will be carried out alongside the addition of up to 20 new telephone exchanges in Phuket, which he said currently has a PSTN capacity of 60,000 numbers, with 43,000 lines in use. He added that there is disproportionately high demand in certain areas of the island, leading to a waiting list for connections. TOT is in the process of installing a total of 560,000 new fixed lines under a delayed nationwide expansion programme.

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Thai telco TOT has agreed to pay THB2.4 billion (USD80 million) for its state-owned sister company CAT Telecom’s 42% stake in struggling GSM operator Thai Mobile, to take its ownership to 100%, reports the Bangkok Post. Information and Communications Technology Minister Sitthichai Pookaiya-udom said the agreement was reached last week between TOT board chairman Saprang Kalayanamitr and CAT board chairman Montri Sangkasup. The two state telecom firms have argued for years over the management of Thai Mobile, which despite being the country’s only UMTS spectrum holder, has only around 70,000 customers in a market of over 40 million users, some of which are civil servants who do not even pay for its services. It has debts of around THB6 billion. TOT plans to expand Thai Mobile’s subscriber base and to invite foreign partners to invest in the building of a W-CDMA network, whilst CAT will now concentrate on the nationwide rollout of CDMA2000 1xEV-DO services, which it offers under the CAT CDMA brand as well as in partnership with Hong Kong’s Hutchison under the Hutchison CAT Multimedia Wireless banner. TOT board director Djit Laowattana said that the agreement between General Saprang and General Montri did not need to go through their respective boards, which would only have to acknowledge the decision.

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TOT Plc is being encouraged to invite other countries to make investment proposals for its third-generation (3G) mobile phone network at the government-to-government level and to use open network architecture.

The open-architecture method would pave the way for a telecom-pool concept and will be a win-win model for all parties, says Sitthichai Pookaiyaudom, the Information and Communications Technology (ICT) minister.

The US Federal Communications Commission (FCC) defines open network architecture as the overall design of a communication carrier’s basic network facilities and services that permits all users to interconnect to specific basic functions on an unbundled, equal-access basis.

The great advantage of open architectures is that anyone can design add-on products for it, says Dr Sitthichai.

TOT board director and spokesman Djit Laowattana said the minister advised that investment in a 3G network should be on a government-to-government basis.

Mr Djit said the open architecture pattern also would not restrict TOT from access to technology development, technology transfer and new investors.

The minister also advised, however, that in proposing open network architecture, TOT must study all regulations and laws, even the joint private-public investment law, although in reality foreign government offering either long-term or soft loans was not considered a joint investment.

Mr Djit said that TOT had received proposals from manufacturers including Alcatel, Marubeni, ZTE and Huawei to build the 3G network.

He said that when the 3G network was complete, then all private operators could rent it from Thai Mobile for use at a low rate of just cost plus a small margin.

With such low rent, newcomers were ready to pay in exchange for access to the wide coverage of the network and Thai Mobile would obtain the rent, he said.

Mr Djit also disclosed that Thai Mobile had received proposals from DTAC and AIS for free roaming on their networks for 100,000 numbers each.

In exchange for the free roaming for Thai Mobile’s 100,000 numbers, DTAC asked for either the renting or using Thai Mobile’s two million numbers instead, he said.

Thai Mobile still has 10 million numbers remaining after it was allocated the numbers from the National Telecommunications Commission, he said.

However, he said the proposal of free roaming in exchange for using or renting two million numbers of Thai Mobile would be forwarded to the NTC for acknowledgement.

AIS also agreed to DTAC’s proposals to TOT and was ready to propose the same, he said.

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Thai Mobile is moving closer to becoming the country’s first 3G operator, with Vodafone and Alcatel-Lucent interested in helping to construct a W-CDMA network for the cellco. Additionally, investment funds from China and Russia would extend long-term loans for Thai Mobile to help pay its way initially. Djit Laowattana, a board director and spokesperson for TOT – the company that owns 58% of Thai Mobile – revealed that Alcatel-Lucent has scheduled a meeting to discuss a proposed 3G network. He also disclosed that at the first meeting of TOT’s 3G committee, it considered using approximately THB17.4 billion (USD566 million) to migrate the current 2G service of Thai Mobile to 3G in three phases. The initial phase would cost THB1.4 billion to upgrade the existing 533 base stations and core network from GSM to W-CDMA. This would be followed by investment of THB15.5 billion to expand services nationwide, with a final THB400 million required for six major provinces in Nakhon Ratchasima, Khon Kaen, Chiang Mai, Phuket, Nakhon Sawan and Surat Thani. The migration, he said, relies on rival cellcos AIS and DTAC using its 3G network, something which could prove to be a stumbling block; both operators have in the past revealed intentions to build their own next generation networks.

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Thai Mobile is moving closer to becoming the first 3G service operator with two European telecom operators and investment funds from China and Russia interested in helping start the broadband cellular service and provide long-term loans. Djit Laowattana, a TOT board director and spokesperson, disclosed after a meeting yesterday that England’s Vodafone and France’s Alcatel had shown interest in helping construct the network for Thai Mobile with their 3G technologies.

Investment funds from China and Russia would extend long-term loans for Thai Mobile to start up the third generation cellular services.

Thai Mobile is a joint venture between TOT (58%) and CAT Telecom (42%). It is the only operator using 1900 megahertz, a global 3G cellular-technology platform. The now defunct Frequency Allocation Committee set aside the spectrum for Thai Mobile before the National Telecommunications Commission was established three years ago.

He said that Alcatel scheduled a meeting with TOT to propose its 3G technology on Friday.

He disclosed that at the first meeting of TOT’s 3G committee, it considered using about 17.38 billion baht to migrate the existing 2G service of Thai Mobile to 3G in three phases.

The migration, he said, pinned hope on Advanced Info Service and DTAC using its 3G network and helping with innovation services.

He said Phase I would involve investing around 1.4 billion baht to upgrade the existing 533 base stations and core network from GSM to WCDMA or 3G technology.

The second phase would use 15.5 billion baht for nationwide investment, and the last phase would need another 400 million baht for six major provinces in Nakhon Ratchasima, Khon Kaen, Chiang Mai, Phuket, Nakhon Sawan and Surat Thani.

The holding structure of the 3G network would be the same with ACT Mobile as the network owner, while Thai Mobile would rent the network to operate.

But he said that TOT was in the process of buying CAT’s stake in Thai Mobile at 2.4 billion baht, a deal which has yet to be settled.

He said that while the 3G committee was in favour of 3G networks, private operators showed little interest in investing by themselves due to low margins.

He said TOT wanted help from local operators as partners to help manage and develop services.

However, he said that there was no settlement yet on the proposals, but that the situation could become clearer within the next three months before the general elections at the end of the year.

But Sigve Brekke, the chief executive of DTAC, said that his company had never expressed interest in using Thai Mobile’s 3G network service.

The TOT board however had expressed interest in attracting private operators to use the Thai Mobile network, and had approached DTAC with the concept three months ago. But no direct talks with Thai Mobile had been held to date, Mr Brekke said.

He added that DTAC planned to build its own 3G network and would rather allow Thai Mobile to use its facilities instead.

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The Thai regulator NTC has ordered communications provider TOT to begin negotiating interconnection charges with mobile operator DTAC or risk penalties, the Bangkok Post writes. TOT missed the 5 July deadline for beginning negotiations. The ongoing dispute concerns a new interconnection scheme which replaces the old access charge scheme. Mobile operators DTAC and TrueMove have already stopped paying access charges under the new interconnection scheme. The state enterprise is refusing to adopt the new system as it believes it will receive less money from access charges.

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Thailand’s TOT will soon scrap an IP-enabled service and marketing contract between its Thai Mobile cellular venture and Milcom Systems after detecting irregularities and revenue leakage of more than 100 million baht ($3.03 million) per month.

A TOT board committee that has been investigating past deals made by the state telecom enterprise said the Milcom deal was among the factors that resulted in Thai Mobile president Vasukree Klapairee being removed and TOT president Somkhuan Bhruminhent being transferred to an “inactive” position.

Djit Laowattana, a TOT director and member of the committee, said it had obtained documents on the deal and would recommend that the TOT board scrap the contract next week.

The committee would also press charges against any TOT executives found to have knowledge of the alleged fraud, he said, adding that a final investigation would take one more month. Milcom Systems obtained the two-year contract from Thai Mobile in March last year.

Its IP-enabled services includes voice calls using broadband Internet connections from PC to phone, phone-to-phone, VoIP, teleconferencing, Wi-Fi mobile hand phone, international and domestic VoIP calling service.

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The operating contracts of all private mobile phone network providers in Thailand have been ruled illegal under a decision by the Council of State which stated that changes made to concessions between private operators and state-owned TOT and CAT Telecom had failed to meet requirements under the 1992 joint public-private investment law. However, ICT Minister Sitthichai Pookaiyaudom stressed that services will not be interrupted even though all contracts must be renegotiated from scratch, which he said could be completed before the military-backed interim government is scheduled to hold elections – expected by October. The decision was expected by GSM cellcos AIS, DTAC and True Move, which offer services under build-transfer-operate (BTO) concessions, and private-public joint venture Hutchison CAT Wireless Multimedia – as the regime had already declared the contracts illegal before asking the Council of State for a ruling. There will be no move to freeze or cancel the concessions, in order to avoid disruption to services, Dr Sitthichai claimed, although the ruling technically allows it. The ruling leaves open the possibility that recent amendments, which included changes in revenue-sharing terms and concession lifespans, could be made void. The Minister called on the operators to enter into talks on restructuring their contracts to create a level playing field under a single, unified framework. Sitthichai said he expected the negotiations between the two state enterprises and private operators to take around 90 days, after which the cabinet would review the proposals. ‘We expect the entire process to be completed within 180 days,’ he said, adding that: ‘It’s my dream that all concession contracts be made the same. In reality of course, that might not be the case. But at least, each player will pay 30% in revenue sharing [to network hosts TOT or CAT].’ He went on to say that he would propose that authorities move forward with converting existing concession contracts altogether to truly create a competitive landscape, where concessions are scrapped in favour of new licensing agreements. DTAC and True Move, which operate under CAT Telecom concessions, pay the state enterprise 25% of their revenue, a sum that will increase to 30% from 2011, whilst AIS, which operates under a TOT contract, pays 20% of its pre-paid service revenues. Commenting on the upcoming negotiations, DTAC has suggested that AIS’s pre-paid rates be increased to 25% now and 30% in 2011 to bring them to comparable levels.

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