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3G legal clarity awaitedSep 24, 2010 (Bangkok Post - McClatchy-Tribune Information Services via COMTEX) -- The scrapping of the 3G licence auction has mobile operators reviewing their strategic and financial plans while they wait for legal clarity on how the telecoms industry will be regulated. Shares of the top three operators fell yesterday on the Stock Exchange of Thailand after the Supreme Administrative Court upheld a Central Administrative Court injunction to halt the auction for wireless broadband licences. The Constitutional Court will now be asked to determine whether the National Telecommunications Commission (NTC) has any legal authority to issue the licences, or whether the auction must await the formation of a new National Broadcasting and Telecommunications Commission (NBTC). Advanced Info Service (ADVANC) declined 1.1% to 90.75 baht, in trade worth 1.66 billion baht. DTAC fell 1.3% to 39.25 baht, in trade worth 851.2 million, and True Corp lost 17% to 4.10 baht, in trade worth 2.82 billion baht. The overall SET index closed at 947.1 points, up 2.1 points, in trade worth 47.33 billion baht. The index rose as high as 957.22 points before falling back on profit-taking in the afternoon. Pongpat Siripipat, an analyst with KGI Securities, said telecom stocks would likely be affected only short-term by the court decision. True vice-chairman Athueck Asvanont said a vacuum now existed in the industry. But no matter how the Constitutional Court rules, it will not be smooth sailing for 3G, in his view. "It could take two months or more and nobody can predict what the ruling will be," he said. He said it was no longer clear whether the NTC had any authority to allocate or transfer frequencies, which it has been doing for five years. Just as murky, he said, was the fate of the government's plan to terminate 2G mobile concessions and replace them with new licences, because no agency would dare issue licences pending reassurances that such moves would be within the law. Even if a court ruling favoured the NTC, the state telecom enterprises CAT Telecom and TOT might appeal again, raising new grounds to challenge the regulator's authority. A ruling against the NTC, meanwhile, could call into question all the other decisions it has made in the past. Mr Athueck also denied allegations that True was behind a move to derail the 3G auction because it was less prepared financially and technically than its two larger rivals, AIS and DTAC. "This is untrue. True is fully ready to enter the bid and comply with the auction rules," he said. In any case, Mr Athueck, said 3G technology was becoming outdated. Thailand is one of the few countries in Asia without 3G. Vietnam this week began accepting applications for 4G licences. Dhanin Chearavanont, the chairman of CP Group, the parent of True Corp, said True still had enough money to repay debts and earn profits because it had a full range of other services including pay-TV, internet and fixed-line phones. True Corp chief executive Supachai Chearavanont said he welcomed the government's proposal to allow existing operators to upgrade 2G networks to 3G under the 2G concessions, but the conditions need to be studied. He said True Move had signed a tentative agreement with CAT Telecom to rent the 2G network it had transferred to the state enterprise for another five years after its concession ends in 2013. A conclusion is expected soon. However, he admitted that the rental agreement would provide no guarantee of future frequency rights. Advanced Info Service chief executive Wichian Mektrakarn said private companies could do nothing pending the establishment of the NBTC, which could take at least three years. DTAC chief executive Tore Johnsen said it was essential to clarify regulatory authority as soon as possible so that the industry can develop. "[There could be] loopholes for the industry in aspects of all frequency allocations until a ruling from the Constitution Court is made," he said. Mr Johnsen said DTAC would see no business impact for now as it would simply take 3G out of its business plan. He said DTAC would need to shift its focus back to its previous plan to upgrade its existing analogue 850-megahertz frequency to high-speed download packet access technology. Give us your ideas! What do you want to see at the website? We need your input! We appreciate your suggestions. Take survey To see more of the Bangkok Post, or to subscribe to the newspaper, go to http://www.bangkokpost.com/. Copyright (c) 2010, Bangkok Post, Thailand Distributed by McClatchy-Tribune Information Services. For more information about the content services offered by McClatchy-Tribune Information Services (MCT), visit www.mctinfoservices.com, e-mail [email protected], or call 866-280-5210 (outside the United States, call +1 312-222-4544). |