In this article, we highlight the vast unused telecom network capacity set aside for Mobile Virtual Network Operators (MVNOs) in Thailand, due to reluctance from the mobile network operators, AIS, Dtac and True, to accept these on their networks. This article is the first in a three part series on spectrum, MVNOs and digital economy in Thailand.

Prior to Thailand’s 2100 MHz 3G auction in 2012, the National Broadcasting and Telecommunications Commission (NBTC) released a notification regarding Criteria and Procedure for the Spectrum.

The notification contains a paragraph regarding network capacity and obligations for Mobile Virtual Network Operators (MVNO’s) in Thailand.

16.5 Mobile Virtual Network Operator (MVNO)

16.5.1 The Licensee shall provide telecommunications network service with the minimum capacity of 10 percent of its networks to the MVNO who is not the Connected Person in the Shareholding Structure with any licensee when receiving such service request

In October 2012 Advanced Info Service (AIS), via its subsidiary Advanced Wireless Network, Digital Total Access Communication (DTAC), through its DTAC Network unit, and True Corp subsidiary, Real Future, each won a 15-year license with 2×15 MHz frequency blocks on the 1900/2100 MHz.

Given the NBTC notification above, and the fact that no MVNO has launched on any of the private operators 1900/2100 MHz network, this means that now, three years later Thailand has:

• AIS – Advanced Wireless Network (AWN): 10 percent unused MVNO network capacity
• Dtac – DTAC Network: 10 percent unused MVNO network capacity
• True Corp – Real Future: 10 percent unused MVNO network capacity

Figure 1: Unused capacity (dark color) on the 1900/2100 MHz 3G Network (private operators) as of 2015

In addition, the state-owned telecom operator, Telephone Organization of Thailand (TOT) holds a 2×15 MHz block on the 1900/2100 MHz bandwidth, which was launched in December 2009.

TOT’s 2100 MHz is highly underutilized with less than 100,000 subscribers between TOT’s own 3G service and its remaining MVNOs.

Given the high data usage from mobile device consumers in Thailand today, it is estimated that TOT’s service on the 2100 MHz would be able to serve approximately 7 million users.

However, there may be various universal service obligations (USO) and usage on TOT’s 2100 MHz, which we are unaware off, therefore we estimate TOT and its MVNOs are currently using (best-case scenario) maximum 2 percent of full capacity its 2100 MHz.

Which shows that we have 3 x 10% unused MVNO capacity on the private telecom operators (AIS, Dtac, True) 1900/2100 MHz Network (Figure 1 above) plus additionally 98% unused capacity on TOT.

Figure 2: Unused MVNO capacity (dark color) on the 1900/2100 MHz network private operators and TOT

REGARDING 850 MHz SPECTRUM – CAT TELECOM AND TRUE CORP

Although the other state-owned telecom operator, Communications Authority of Thailand (CAT Telecom) has the operating license for the 850 MHz frequency band, CAT Telecom has outsourced the network operations and management to “BFKT” (a True Group subsidiary).

Figure 3: CAT Telecom and True’s 850 MHz “MVNO” setup

BFKT build and operates the 3G network infrastructure, and CAT Telecom then leases the equipment from BFKT. Another of True group’s subsidies “RealMove” buys 80% of the network capacity to resell under the True Move H brand, thereby technically functioning as a mobile virtual network operator (MVNO) to CAT Telecom, although this has recently been questioned by the Thai Auditor-General.

This leaves CAT Telecom’s sub-brand “MY CAT” and CAT Telecom’s MVNOs with 20% of network capacity to share.

UNUSED MVNO CAPACITY ON THE 900 MHz AND 1800 MHz SPECTRUM

The National Broadcasting and Telecommunications Commission (NBTC) recently auctioned two licenses on the 1800 MHz spectrum, and will auction two more licenses on the 900 MHz licenses December 15, 2015.

As with the 2100 MHz spectrum, the NBTC has also added a clause in the terms and condition for the 900 MHz and 1800 MHz licenses:

Clause 18 Service of Mobile Virtual Network Operator (MVNO)

(1) The Licensee shall comply with the Commission’s Notification Regarding Mobile Virtual Network Operator Service B.E. 2556 (2013).

(2) The Licensee shall provide telecommunications network service at least 10 percent of its network’s capacity to MVNO(s) that is/are not the connected person(s) with any licensee under this Notification, upon receiving such service request.

All four licenses carry the same clause and terms regarding MVNOs, that the license holder must provide telecommunications network service of at least 10% of its network’s capacity to MVNOs

The consequence of which will be, that post the 900 MHz and 1800 MHz auction we will see an additional unused 40 percent (4×10 percent) MVNO capacity in the market.

Figure 4: Unused MVNO capacity (dark color) on the 900/1800 MHz Network

AIS – TOT PARTNERSHIP

However, on November 13, TOT’s board officially selected AIS as TOT’s 3G-2100 MHz partner for 10 years.

According to local news reports, TOT will wholesale 80% of the bandwidth on all TOT’s existing and planned base stations to AIS. TOT will then wholesale, or seek another partner to wholesale the remaining 20%.

TOT has been looking for partners to make use of its network to replace lost revenue from the transition to a spectrum-licensing model from a build-transfer-operate (BTO) concession mode for almost a year.

Figure 5: Unused MVNO capacity (dark color) on the 900/1800/2100 MHz Network – post AIS/TOT partnership

Which brings the total sum of unused network capacity set aside for MVNO operations across the 900 MHz, 1800 MHz and 2100 MHz spectrum (after a successful AIS/TOT partnership) to:

• AIS alone has 3 x 10% unused MVNO capacity across 3 spectra (900 MHz, 1800 MHz, and 2100 MHz).
• True also has 3 x 10% unused MVNO capacity across 2 spectra (900 MHz, 1800 MHz and 2100 MHz).
• DTAC has 1 x 10% unused MVNO capacity in one spectrum (2100 MHz).

POSSIBLE 2300 MHz AND 2600 MHz SPECTRUM AUCTION

More unused MVNO capacity could be added in the near future, as the government has agreed with the digital economy panel’s resolution to set aside other telecommunications spectra for 4G LTE. Some portion of the 2300 MHz and 2600 MHz spectra could be options.

Figure 6: Unused MVNO capacity (dark color) on the 2300/2600 MHz Network – in case of four licenses

Which will bring the total sum, of unused network capacity set aside for MVNO operations, across the 900/1800/2100/2300/2600 MHz spectrum to:

Figure 7: Total unused MVNO capacity (dark color) across the 900/1800/2100/2300/2600 MHz spectra in Thailand

In our next article in this series, we highlight why MVNOs in Thailand have failed, including the reluctance from the private telecom operators to allow MVNOs on their networks, while they themselves, are busy becoming MVNOs.

DEFINITIONS USED THROUGHOUT THIS DOCUMENT

MVNO – MOBILE VIRTUAL NETWORK OPERATOR It is an organization, which offers mobile services. The MVNO does not own spectrum, instead it enters into an agreement with either a network operator or MVNA to obtain bulk access to network services at wholesale rates, and then sets its retail prices independently. An MVNO may use its own customer service, billing support, marketing systems or employ these services from a MVNE

MVNE – MOBILE VIRTUAL NETWORK ENABLER It is an entity, which provides infrastructure and services to both network operators and MVNOs, which enables existing, and new MVNOs to offer their services on the operator’s network, while leaving the backend enablement to the MVNE. The MVNE provides services, such as billing, business workflow, product setup, service delivery, customer care, fraud management, web services, reporting, sale platforms, etc.

MVNA- MOBILE VIRTUAL NETWORK AGGREGATOR The MVNA is an entity, which purchases mobile airtime in bulk from the partner network, and then wholesales this airtime and service to multiple MVNOs, who each in turn sells the mobile service to end-users.

MVNA/MVNE – MOBILE VIRTUAL NETWORK AGGREGATOR & ENABLER is a combination of, Mobile Virtual Network Aggregator and Enabler. The MVNA/MVNE is an entity, which purchases mobile airtime in bulk from the partner network, adds its service platform (MVNE) on top, and then wholesales this airtime and service as end-to-end to multiple MVNOs and service providers.