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Thailand delays 3G auctions - to standardise 2G licences

Thailand’s long-delayed 3G auctions have once again been postponed, with the government claiming that the terms for the country’s existing 2G licences must be standardised before the new licences can be issued.

According to the Financial Times, Thailand’s finance minister Korn Chatikavanij said in an interview that a standard would have to be established before auctions for the four new 3G licences could go ahead. The auctions were scheduled to take place in December.

“We have a legacy of different concessions being given by different state agencies to different people on different terms,” said Mr Chatikavanij. “We want to provide a standardisation so that free and fair competition could exist and the private sector could have a greater level of confidence to make the kind of investments we want to see.”

Thailand’s three main operators – AIS, DTAC and TrueMove – hold the existing licences, which were issued by previous governments. The terms are inconsistent between each of the licences, which many regard as a result of corruption and cronyism.

Mr Chatikavanij conceded that resolving this licensing issue would inevitably delay the auctions by a few months. However, this is not the first setback that the auctions have suffered, and the continued postponement of the auctions is a source of frustration for industry-watchers. Sriyan Pietersz, head of research at JP Morgan in Bangkok, expressed his distaste at the backward-looking nature of this particular hold-up, saying: “The issue is not the old concessions: the country needs to move forward on 3G.”

Exacerbating the problem is the confusion over whether the National Telecommunications Commission – the country’s regulator – is authorised to hold the auction. This would present yet another setback to the auctions, which are expected to generate around US$1.2 billion for the Thai government.

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