4G AUCTIONIN THAILAND

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Thailands National Broadcasting and Telecommunications Commission (NBTC) has finally been able to set a timetable for the country's 4G spectrum auctions, after the cabinet gave the green light to proceed with the auctions plans.

The NBTC expects to issue 4G licenses for the 1800 MHz spectrum November 11, 2015 and the 900 MHz spectrum December 15, 2015.

If no further delays arise, NBTC expects to issue the licenses for the 1800 MHz spectrum in December and the 900 MHz spectrum in January 2016.

The new commercial 4G services could then be rolled out by April 2016.

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TrueMove H under the True Corp was the first to introduce4G LTE in Thailand with a trial service in February 2013

True utilizes 10 MHz of its 15 MHz of bandwidth on the 2100 MHz spectrum to offer 4G, via its roughly 10,000 network sites nationwide.

True Move went commercial with the 4G and claims 800,000 4G subscribers end of 2014

DTAC currently utilizes 5 MHz of bandwidth on the 2100 MHz spectrum to offer 4G service, with the remainder being used for 3G.

The company currently uses all 25MHz of its bandwidth on the 1800MHz spectrum for 2G cellular service, while it uses the 850MHz spectrum to provide 3G.

DTAC has 600,000 4G subscribers

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An LTE trial was approved on 2300 MHz by the NBTC.TOT partnered with its concession holder AIS to trial 2300 MHz LTE TDD in 20 MHz of its total 64 MHz allocation, using 20 base stations in central Bangkok.

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Digital Phone Co (AIS Subsidy) joined with CAT Telecom to test LTE1800 from mid-January 2012 in Mahasarakham

Japanese Telco, Softbank has formed a partnership with TOT which will focus on joint development of a 2300 MHz LTE TDD network using TOT's bandwidth. It is likely that the LTE network will be used for mobile backhaul for Wi-Fi access points and mobile cell sites.

The 2600 MHz frequency band has been assigned to MCOT and is utilized for MMDS technology. However, MCOT, a broadcast company, is a not a 100% privatized company and a large part of its shares are held by the Ministry of Finance, negotiations for the return of the spectrum has proven to be extremely challenging

Source: Nokia Solutions and Networks (Thailand).

Thailand has 40 million smartphones, of which 25% are 4G-enabled devices

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NBTCRegulator

900 MHz17.5MHzBandwidth

AIS17.5MHz

2100 MHz15MHzBandwidth

MVNO15MHz

2100 MHz45MHzBandwidth

AIS15MHz

DTAC15MHz

True15MHz

1800 MHz75MHzBandwidth

DPC12.5MHz

True12.5MHz

DTAC50MHz

850 MHz25MHzBandwidth

DTAC10MHz

True15MHz

BTO contract ends 2015

MVNO Wholesale contracts

Auctioned license

Auctioned license

Auctioned license

Ended 2013

Ended 2013

BTO contract ends 2018

Wholesale - Resell

License ends 2015

License ends 2025

License ends 2027

License ends 2025

License BTO contract

Ends 2018

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800 MHz (CDMA/UMTS)

834.4 MHz 839.4 MHz 849 MHz

CAT/BFKT 15 MHz Expires in 2025 CAT/DTAC 9.7 MHz Expires in 2018

900 MHz (GSM/UMTS) TOT/AIS 17.5 MHz Expires in 2015

897.6 MHz 915 MHz880 MHz

824.4 MHz

TMV 12.6 MHzExpired in Sept. 2013

DTAC 25 MHzExpires in September 2018

DPC 12.6 MHzExpired Sept. 2013

DTAC 25 MHzExpires Sept. 2018

1710 MHz 1722.6 MHz 1722.8 MHz 1747.8 MHz 1748 MHz 1760.6 MHz 1785 MHz

TruePCT

DTAC15 MHz

True15 MHz

AIS15 MHz

TOT15 MHz

1965 MHz 1980 MHz

1900 MHz/2100 MHz (PCT/UMTS)

1800 MHz (GSM/*FDD-LTE)

TOT 64 MHz

2300 MHz 2400 MHz

2300 MHz (*TDD-LTE)

1920 MHz1906 MHz 1918 MHz

MCOT 48 MHzExpires in 2015

2500 MHz 2608 MHz

2600 MHz (*TDD-LTE &FDD-LTE)

2536 MHz 2584 MHz 2592 MHz

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Trunked Radio

CATCAT

DTACTrunked

RadioCAT

CATDTAC

TOT/AIS

RFI

D

TOT/AIS

MHz 806 824 839 849 851 869 884 894 897.5 915 920-925 942.5 960

Expires 2025

Expires 2018

Expired 2015

User

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Unused

Unused

TMV 12.6 MHzExpired in Sept. 2013

DTAC 25 MHzExpires in September 2018

DPC 12.6 MHzExpired Sept. 2013

DTAC 25 MHzExpires Sept. 2018

1710 MHz 1722.6 MHz 1722.8 MHz 1747.8 MHz 1748 MHz 1760.6 MHz 1785 MHz

DCS1800 (UL)

TMV 12.6 MHzExpired in Sept. 2013

DTAC 25.3 MHzExpires in September 2018

DPC 12.6 MHzExpired Sept. 2013

DTAC 24.5 MHzExpires Sept. 2018

1805 MHz 1817.6 MHz 1817.6 MHz 1842.9 MHz 1855.5 MHz 1880 MHz

DCS1800 (DL)

900 MHz (GSM/UMTS) TOT/AIS 17.5 MHz Expires in 2015

897.6 MHz 915 MHz880 MHz

TMV 12.6 MHzExpired in Sept. 2013

DTAC 25 MHzExpires in September 2018

DPC 12.6 MHzExpired Sept. 2013

DTAC 25 MHzExpires Sept. 2018

1710 MHz 1722.6 MHz 1722.8 MHz 1747.8 MHz 1748 MHz 1760.6 MHz 1785 MHz

1800 MHz (GSM/*FDD-LTE)

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The government has agreed with the digital economy panel's resolution to set aside other telecommunications spectra for 4G mobile phones apart from the existing 900 MHz and 1800 MHz spectra. Some portion of the 2300 MHz and 2600 MHz spectra may be options.

TOT Plc, holds 64 MHz of the 2300 MHz spectrum, which is currently unused.

The ICT Ministry and TOT are studying the possibility of bringing the unused portion of TOT's 2300 MHz spectrum up for auction in order to increase the amount of bandwidth.

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MCOT 48 MHzExpires in 2015

2500 MHz 2608 MHz

2600 MHz (*TDD-LTE &FDD-LTE)

2536 MHz 2584 MHz 2592 MHz

TOT 64 MHz

2300 MHz 2400 MHz

2300 MHz (*TDD-LTE)

In exchange for the 2300 spectrum's return, TOT suggested to keep the 900 MHz spectrum that AIS has used to provide public telecom service for 10 years.

MCOT Plc and the Public Relations Department holds 128 MHz and 26 MHz, respectively, of the 2600 MHz spectrum.

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Criteria Frequency band

700 MHz 800 MHz 900 MHz 1800 MHz 1900 MHz 2.1 GHz 2.3 GHz 2.6 GHz

Signal propagation characteristics 1 1 1 2 2 3 4 6

Whether spectrum band is assigned internationally (or regionally) for LTE

2 2 3 1 5 4 2 1

Availability of network equipment and consumer devices (including handsets)

3 1 6 3 5 3 4 2

Availability of paired bands for uplink and downlink transmissions (assuming the band is to be used for FDD) or a large contiguous spectrum block if the TDD use is proposed (or single TDD band)

1 1 3 2 3 2 1 1

Whether the band is cleared (or clean) of incumbent users

3 2 2 1 2 2 2 3

Need for coordination or other complex negotiations with other users and neighboring countries

1 2 2 2 1 2 2 1

Total 11 9 17 11 18 16 15 14

Analysis of preferred spectrum bands for LTE deployment (ITU, 2012)

Score 1 - 6 with 6 being the ideal score

The current minimum bids were set at 70%of the full spectrum values by the International Telecommunication Union (ITU) in 2014.

NBTC divided the 25 MHz bandwidth of the 1800 MHz spectrum into two slots of 12.5 MHz each and set a minimum bid of THB 11.6 billion for each.

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12.5 MHz

Total 25 MHz

Minimum

11.6 billion

12.5 MHz

Minimum

11.6 billion

The auctions of 20 MHz of bandwidth on the 900 MHz spectrum will be divided into two slots of 10 MHz each, with minimum bids of THB 11.262 billion for the blocks.

At these current prices, the NBTC is estimated to gain between: THB 45.7 and 65.3 billion from the auctions.

However, NBTC could scrap the 70% evaluation and instead decide to go for a 100% valuation if there are at least as many bidders as available licenses.

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10 MHz

Total 20 MHz

Minimum

11.262 billion

10 MHz

Minimum

11.262 billion

The cap is 45MHz for each operator. The cap will apply only to the spectra in use and those with a validity period of more than five years.

It will not include ownership of bandwidth on the 2.3GHz and 2.6 GHz spectra.

NBTC has a policy of remaining neutral on how the spectra up for bid will be used, which means the winning bidders could utilize the bandwidth for 2G, 3G or 4G service

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45 MHz

The NBTC has decided to set a maximum of how much bandwidth each operator can hold, whether they bid for the new licenses late this year or not.

JUL AUG SEP OCT NOV DEC

Aug. 28 - Sept. 28

One month sale ofbidding documents

July 17 - August 18

Public hearing

August 26

Draft auction plan submitted to Royal Gazette

September 30

Bidding envelopes submitted

October 21

Qualified biddersto be announced

November 11

Auction date

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We do not rule out the possibility of delays to the auction

AUG SEP OCT NOV DEC JAN

Sept. 28 - Oct. 28

One month sale ofbidding documents

August 5 - September 9

Public hearing

September 23

Draft auction plan submitted to Royal Gazette

October 30

Bidding envelopes submitted

November 20

Qualified biddersto be announced

December 15

Auction date

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We do not rule out the possibility of delays to the auction

Advanced Info Service (AIS) CAT TELECOM Total Access Communication (DTAC)

Jasmine International (JAS) TOT has not announced its plans True Corp

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AIS fully supports holding the auctions of 900 and 1800 MHz spectra as soon as possible.It currently provides 2G mobile service on 17.5 MHz bandwidth of the 900 MHz spectrum under a concession with TOT, which is due to expire in September 2015.

AIS will participate in both auctions and hopes to win at least two licenses, one on each spectrum. If it gets both, as hoped, it will use 1800MHz for 4G.

AIS expects to be able to start service 3-4 months after obtaining the license.

AIS plans to split the 900 MHz in half with 5 MHz bandwidth for its 2G subscribers and 5 MHz for 3G, especially in the provinces.

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The state enterprise is studying the possibility of participating in the 4G auctions.

CAT has 25 MHz of bandwidth on the 1800 MHz spectrum, previously used by True Move and Digital Phone Co, for which the concessions expired in 2013.

The state enterprise also has a further 50 MHz on the 1800 MHz spectrum, now used by DTAC to provide 2G service. That concession is due to expire in 2018.

In addition, CAT holds 15 MHz on the 850 MHz spectrum to provide 3G service together with True Move subsidiary Real Move under a 15-year wholesale-resale MVNO agreement since 2011. CAT also awarded an additional 10 MHz on the 850 MHz spectrum to DTAC to provide 3G service.

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DTAC has proposed returning its unused 25 MHz on the 1800 MHz spectrum to the NBTC for the 4G auctions.

The company provides 3G service on 15 MHz of bandwidth on the 2100 MHz spectrum under a license with the NBTC.

DTAC has a total of 50 MHz on the 1800 MHz spectrum under a concession with CAT, which is due to expire in 2018.

The company also has another 10 MHz of bandwidth on the 850 MHz spectrum under its contract with CAT.

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The Internet service provider Jasmine International Plc (JAS) plans to enter the 4G spectrum auctions through a joint venture with a foreign telecom firm with an investment budget of up to THB 35 billion.

JAS plans to spend THB 25-35 billion on the initial 4G investment scheme. Of the total, THB 15-20 billion will be marked for the license auction and the remaining 10-15 billion for network spending.

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TOT wants to keep 17.5 MHz of bandwidth on the 900 MHz spectrum after its concession expires to provide its own 4G service in order to generate revenue and services to Thailands digital Economy projects.

TOT also has 100 MHz on the 2300 MHz spectrum, most of it unused.

TOT operates 3G service on the 2100-MHz spectrum under a licensing regime without an auction.

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True Move has thrown its full support behind the government's initiative to bring the 2300 and 2600 MHz spectra into the 4G auctions.

It prefers to bid for the 1800 MHz spectrum rather than the 900 MHz spectrum.

The delays to the 4G spectrum auction has been beneficial for True, as it could maintain its competitive 4G advantages, gaining market shares at the expense of AIS and DTAC.However, the 4G spectrum auction would clear out such competitive advantages and level the playing field in the market.

True would have a strategic reason to outbid DTAC in the auction to overtake DTAC and take the number two position in the market.

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Concession License Concession License Concession License

Cellular towers 13,690 6,000 11,000 1,500 6,000 11.845

Installed BTS/Node B850 MHz 0 0 5,000 0 0 14,000

900 MHz 15,000 0 0 0 0 0

1800 MHz 4,000 0 11,000 0 7,000 0

2100 MHz 0 20,500 0 12,500 0 5,000

Total 19,000 20,500 16,000 12,500 7,000 19,000

Grand Total 39,500 28,500 26,000

2G Coverage 97% of Population 95% of Population 90% of Population

3G coverage 97% of Population 88% of Population 97% of Population

4G Coverage 0% of Population 10% of Population 30% of Population

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We assist public and private sector clients in their decision making through market insights, experience and technical skills. Our clients includes: Governments, Telecom Regulators, Telecom operators, MVNOs, Mobile device manufacturers, Retailers, Software & Service providers, Media and Broadcasting companies.

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