The telecom regulator has rejected a request by Total Access Communication (DTAC) to develop a fourth-generation (4G) wireless broadband service on its existing unused bandwidth in the 1800-megahertz spectrum.
The decision was made yesterday by the telecom committee of the National Broadcasting and Telecommunications Commission (NBTC).
"Approval of the proposal would violate the concession agreement between DTAC and its concession owner CAT Telecom," said Col Settapong Malisuwan, chairman of NBTC's telecom committee.
The country's second-largest mobile operator has 50MHz of the 1800MHz spectrum under a 2G concession with CAT that will expire in 2018. The company used only half of the total, with the existing unused 25MHz band belonging to CAT under the concession agreement.
DTAC last year returned an unused 5MHz out of 25MHz on the spectrum for the 4G auction. As a result, the company now has 20MHz of unutilised bandwidth.
Col Settapong said DTAC must show a formal letter between the company and CAT to demonstrate that both parties had agreed on the 4G development proposal.
"Personally, I think DTAC and CAT should revise some conditions of its concession to ensure that the request does not violate either the law or the agreement itself," he said.
"We [NBTC] have no authority to allow either state enterprises or private companies to run businesses that do not comply with concession contracts," he added.
DTAC submitted the proposal seeking permission for the network upgrade to the NBTC on Nov 9 last year.
CAT acting president Col Sanpachai Huvanandana said he personally believed CAT could allow DTAC to upgrade to 4G on the 1800MHz spectrum because the unused bandwidth belonged to it under the deal.
"I believe a reversal of the concession is unnecessary," he said.
CAT is scheduled to discuss the issue with DTAC next Monday, said Col Sanpachai.
He added that CAT had initially expected annual revenue of 900 million baht from DTAC's 4G upgrade proposal under a partnership agreement.
Under the agreement, DTAC is required to invest in 4G infrastructure including equipment and base stations. CAT would then allow DTAC to provide 4G service on the network under a wholesale agreement.
Col Sanpachai acknowledged that any delay in DTAC's 4G network upgrade could affect CAT's opportunity to generate new revenue streams in the future.
CAT had initially planned to allow DTAC to provide 4G service on the 1800MHz network until 2018, the expiry date of its concession, he said.
DTAC chief executive Lars Norling earlier said the 4G upgrade plan will enable CAT to generate more revenue, maximise the utilisation of spectrum resources and accommodate skyrocketing mobile data service demand.
The bandwidth increase would make DTAC the only mobile operator providing 4G service on 20MHz for a single spectrum.
Providing 4G service on a single spectrum can accommodate a wider range of 4G mobile capabilities and handset prices, ranging from low-end to high-end models, said Mr Norling.