SET-listed Samart I-Mobil (SIM), the most active operator under the mobile virtual network operator (MVNO) model, says it will scrap an agreement with TOT Plc to provide 3G service on the state telecom enterprise's 2100-megahertz network by year-end.
The handset flagship of Samart Corporation will focus on providing mobile service on CAT Telecom's 850MHz network for a single platform.
"The contract termination is simply to focus on providing 3G service on a single network [CAT] in order to manage operating costs more effectively and enhance our brand recognition," said Samart president Watchai Vilailuck.
Focusing on a single operation will allow SIM to boost its customer base and market share, he added.
SIM provides 3G service on both TOT and CAT networks under the MVNO model -- where companies provide mobile services but do not own networks.
Mr Watchai said the company decided to choose CAT because of its greater network coverage than TOT.
CAT has 14,536 3G base stations nationwide, while TOT has 5,320.
In addition, CAT is cutting the wholesale leasing prices it charges for its 3G network by 10% this year-end to increase profit margins for MVNOs.
SIM started providing mobile service on TOT's 2100MHz network in 2010, and on the CAT's 850MHz band in May this year.
CAT has five companies providing 3G mobile service on its 850MHz network under the MVNO model -- Real Move, a subsidiary of third-ranked TrueMove; The WhiteSpace, the operator of Penguin; Data CDMA, the operator of My World 3G brand; 168 Communication; and SIM.
TOT awarded five firms, including Samart, the right to resell 3G service over its high-speed packet access network.
SIM has a combined 200,000 active 3G customers under TOT and CAT networks, down from 700,000-800,000 four years ago.
Mr Watchai admitted that MVNOs face intense competition from mobile operators, which have stronger financial health and brand names as well as effective distribution networks.
Thailand's mobile market has become increasingly saturated, with the number of mobile subscribers higher than the population.
Furthermore, major operators have continuously pursued aggressive marketing and promotional programmes to increase their market shares.
Earlier, SIM also asked the National Broadcasting and Telecommunications Commission (NBTC) to return 300,000 mobile numbers, out of a total 500,000, to the regulator -- as the company is unable provide acceptable services to its target customers due to high network leasing costs.
The regulator's telecom committee approved SIM's request on Nov 1.
Mr Watchai also said SIM is undergoing major restructuring and brand refurbishment to diversify into non-mobile businesses to reduce reliance on handset sales.
"We're moving into digital marketing and e-commerce to accommodate digital lifestyles," he said.
The company aims to reach 8 billion baht in revenue this year, 80% of which will come from mobile phone sales and the remaining 1.5 billion from non-mobile businesses.